Are virtual data rooms really necessary for due diligence?
We’re prepping for a potential funding round and one of the investors asked if we’d be setting up a data room. Honestly, we’ve always just shared docs through email or Google Drive. Is a professional VDR actually worth it for due diligence, or just an unnecessary expense?
7 Views
If you’re dealing with serious investors, then yes, it’s definitely worth it. The problem with email or cloud links is that once the files are out, you lose all control over who sees them or where they end up. With data rooms for due diligence, you not only keep everything centralized, but you also control access levels, set expiration dates, and track which investor actually looked at the documents. It’s also a credibility thing. Investors tend to take you more seriously when they see you’ve prepared a proper data room, it shows organization and professionalism. Even if your round isn’t massive, it’s usually a smart move.