Data room

Also called: virtual data room, VDR

A folder-permissioned, audit-logged virtual workspace for sharing sensitive documents during fundraising, diligence, or M&A.

A virtual data room (VDR) is a secure, online repository used to share confidential documents with controlled access. Traditional use cases include M&A diligence, fundraising rounds, IPO preparation, litigation, and audits.

Key features that distinguish a data room from a generic cloud folder: per-recipient folder permissions, click-through NDA on entry, watermarking with the recipient's email, full audit logging (who viewed what, when, for how long), download restrictions, and indexed full-text search.

Legacy VDRs (Datasite, Intralinks) charge per-deal fees ranging from $1,200–$10,000 per transaction. Modern alternatives like Dataroom include unlimited data rooms on a flat $9.99/month per-Organization plan.

FAQ

Common questions about Data room

How is a data room different from Google Drive?

Google Drive is a general-purpose file storage system without per-page analytics, recipient-level watermarking, NDA click-through, or audit-grade logging of every view. A data room is purpose-built for sensitive document workflows where attribution matters.

Do I need a data room for a seed round?

Most seed-stage diligence is handled with shared decks rather than full data rooms. Series A and beyond typically warrant a room (10-200 files: legal, financial, IP, customer references, team).

Related terms

Often appears with

NDA

A binding contract restricting disclosure of confidential information between two or more parties.

Watermark

A semi-transparent overlay on document pages (often the recipient's email) used to attribute leaks and discourage redistribution.

Audit trail

An immutable log of every action (view, edit, sign, share) on a document or workspace, exportable as CSV or streamed to a SIEM.

Click-through NDA

An NDA presented as an accept-or-decline modal before a recipient accesses a document, with timestamp and IP captured for audit.

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