Data Room Setup: A Simple 8-Step Guide

Virtual data rooms save businesses a lot of time and effort during deals providing participants with all the tools necessary for efficient teamwork and a secure virtual space for keeping confidential information. Also, such software is beneficial for general document maintenance. It allows companies to keep all papers organized, updated, easy to share, and, most importantly, safe in the due diligence process and other business transactions.

But if a data room is not set up correctly, it becomes more of a problem than a solution. That’s why it’s important to approach this software from the moment of choosing a provider and up to the point of actually collaborating with its help. This guide will tell you all the details you need to prepare ahead of time and get the most out of a dataroom.

1. Choose a virtual data room provider

It’s essential to pick a vendor that will fit your needs perfectly. The choice is rather vast, but it’s not that hard to make the right decision. Here are the criteria you can use when looking for a data room provider:

  • Your industry. While there are a lot of versatile vendors, begin with brands that offer tailored solutions for companies from your field of operation to make sure the data room will have all the required certificates and features.
  • The functions you need. While some businesses will be fine without advanced features such as customization and a built-in AI, others might feel restrained if a virtual data room lacks specific tools.
  • The budget.t’s important to have additional tools on board, the bill for the data room shouldn’t be a burden for your company.
  • Reviews. Providers will always tell all the best things about their product. Dive into real reviews and customer testimonials to see the bigger picture.

And once you find that perfect fit, don’t rush it. First, use the trial period or a demo version a provider offers to see if the software truly suits your needs. 

set up data room

2. Prepare the documents

Today, most businesses have their sensitive documents already digitized. For such companies, it won’t be an issue to prepare the files for the upload and figure out which ones should go inside the data room. 

However, you should double-check anyway whether some physical papers are left — if you think you might need them in your data room, digitize them. Ensure all the documents are up to date, and if they were scanned, check for all the information to be perfectly visible.

Since most data room providers would allow users to create several workspaces, you must give different projects clear and sound names that won’t let you mix them up. Ideally, you want to have a separate workspace for the internal document maintenance if you’re going to use a virtual data room, not only during deals. If you have such a workspace in your VDR, it’s vital that both you and your employees can tell it apart from other projects so that no one gives access to third parties to highly confidential files.

3. Upload and organize the files

Modern data rooms offer a drag and drop feature that allows users to upload documents in bulk without hassle. Using this function for your data room setup, you can move the whole hierarchy of folders and files if you have one established on your device already. The virtual data room will then index them automatically, and you’ll have a ready-to-use workspace.

But if your documents are unstructured, you can organize them in the VDR. Create separate folders to group the files. For example, you could give your folders the following names:

  • General corporate documents
  • Capital stock and securities
  • Finances and taxes
  • Physical property and assets
  • Intellectual property

Of course, the kinds of documents and appropriate names for folders will differ from one project to another. This structure is an excellent guideline for your workspace organization if you’re using a data room for document maintenance.

4. Customize the interface, emails, and agreements

Some providers will let you customize the data room and invitation emails with your corporate colors and logo. Use this feature to create a smooth experience for third parties and make a nice impression. Some vendors also allow users to customize agreements invited parties will have to sign before accessing the data room. It’s an important feature because these agreements let you protect your documents even better.

Also, advanced providers usually offer features to customize watermarks with colors and patterns to your taste. In addition, with the best software, you can customize headers and footers for PDF files that may be downloaded or printed.

5. Add employees

Depending on the pricing plan you chose, you can add a certain number of administrative users to the data room. Determine who you can trust the integrity of sensitive information and add these team members to the workspace. You can then invite other employees who don’t need to have control over papers to work with them — you can give such users view-only access permissions.

6. Fill in the Q&A section

This feature allows you to answer all the frequently asked questions before the deal to create some kind of knowledge base. Then you can assign someone to be responsible for the Q&A section during the agreement. This person will have to answer all the new questions from third parties as quickly as possible to accelerate the deal.

7. Invite third parties

As you’re approaching a business deal, you can invite potential buyers, partners, or authorities to the data room. Most providers offer granular user permissions that allow you to control the levels of access requested users have. 

Furthermore, admins can create groups according to users’ roles and allow them specific features and access levels. This way, project management becomes straightforward, secure, and efficient even if dozens of people are involved. And as a result, you can protect your files from any unwanted threats.

8. Control user activity and get insights

A virtual data room will provide you with reports that give you a clear view of the user activity. You can review these stats to detect suspicious behavior and avoid a data leak. Also, reports can provide you with useful insights on presenting your company better during the deal. And once the process you’re going through is over, you can study reports once again to see how you can improve the workflow during the next deal.

For in-depth and convenient tracking, the virtual data room provider should offer:

  • full audit trails in a print-friendly version for presentations at meetings
  • tracking with details about downloads, prints, views, and file view duration
  • group overview reports containing data on the number of logins, Q&A questions posted, permitted and accessed files
  • color-coded reports indicating the most active member groups and data rooms of the most interest

Virtual data room setup: Conclusion

It’s not hard to organize data room software properly. Moreover, many data room providers offer a support team that can help you during your data room set up. Specifically, they structure the documents and even provide you with a ready-to-use layout suited for the kind of deal you’re getting ready for. Then setting up a data room will be a piece of cake.

However, remember to pay due attention to the choice of data room software. The practical advice in the first paragraph of our guide can be helpful and inspire you to make the right decision. But if you’re eager to explore more — welcome to our main page, where the list of industry-leading providers and some of the best market expertise can be found.

TOP 3 Data Rooms
1. iDeals
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2. Intralinks
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3. SmartRoom
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