An M&A is a big deal that requires a lot of attention to documentation. To do this, the files themselves need to be uploaded or sent somewhere. At the same time, it is necessary to guarantee their safety and that they will not fall into the wrong hands and will not be stolen. Virtual data rooms can be used for this. However, many entrepreneurs have doubts – after all, ordinary clouds like GoogleDrive can be used. Not so simple.
Vulnerabilities of ordinary clouds
Conventional cloud storages (such as GoogleDrive, iCloud, and Dropbox) are subject to a lot of risks:
- Account theft. Phishing can also be a threat to cloud infrastructure. Exploits, manipulations with transactions, and data changes should also be included in this category. Often, attackers consider the cloud the most successful platform for such attacks.
- Lack of awareness. Many companies underestimate this threat, but it can be considered the most potentially dangerous. The bottom line is that many organizations move to the cloud without understanding all the possibilities of such a solution. For example, if the development team is not familiar with the principles of deploying applications in the cloud, then various operational problems can arise.
- DDoS attacks. Perhaps not a single list of possible threats can do without DoS attacks. Such events can slow down or completely stop the operation of capacities, leading to inevitable downtime of business processes. Typically, attacks target database and server vulnerabilities. Therefore, the provider must use special protection mechanisms to prevent DDoS attacks.
Often, the general information security risks of cloud technologies are associated with the emergence of vulnerabilities at one of the levels of the cloud infrastructure. As a result, problems extend to the surrounding levels and affect all users.
Benefits of VDR
A virtual data room is, in fact, the same cloud; however, devoid of all the disadvantages listed above. There are several reasons for this:
- Virtual data rooms have integrated encryption systems, thanks to which information is not stored on servers in its original form but is modified. Even if theoretically (and in practice, this is unlikely) someone steals the data, the cheater will not be able to understand a single line there.
- VDRs are equipped with modern user authentication settings. As a result, it is excluded that the account will be stolen, and someone else will log in instead of a certain user.
- Each user of the virtual data room has its role, according to which a person is given certain rights to edit documents, view, and comment on them.
- The virtual data room administrator sees every change in every document – who made it when it happened. In addition, all version history is securely stored on external servers.
By the way, VDR services servers are located worldwide – the physical impact on them is impossible. For these reasons, virtual data rooms should be chosen for M&A deals over conventional cloud services.