As opposed to file sharing or storage solutions such as Dropbox that only encrypt your files when you upload them, secure data rooms encrypt every document as it moves between servers as well as in storage. This is vital to stop hackers from accessing your data in the event of its loss.
However it is crucial to keep in mind that data rooms are only as secure as the security measures implemented by the server hosting them. Therefore, whilst encryption of data in transit is essential, it’s not enough to guarantee complete security. Additionally, it’s important to check if the virtual data room’s system is able to encrypt temporary files created by downloading documents to the browser. If not that could mean thousands of unprotected documents sitting in the clear on a server that could easily be hacked.
One of the most important features is that you can attach notes to documents that can only be viewed by the person who created them. This reduces the chance of third parties seeing confidential information and enhances collaboration during due diligence. The best secure datarooms also feature dynamic watermarks that update in real time to prevent uninvited sharing of files. They can also be used to trace the origin of a file in the event that it is leaking.
Make sure that the data room you are considering is compliant with industry standards for security by confirming if it is ISO 27001 or similar certification. Choose a data room that has strong encryption and detailed reporting on activity and access.
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