DealRoom vs. Intralinks: 4 Points of Consideration When Selecting A VDR System For M&A
CEO and Founder of DealRoom
How to Pick the Right VDR for Your Deal
Virtual data rooms (VDRs) are quickly becoming synonymous with mergers and acquisitions, specifically, because of their capacity to transform and streamline the overwhelming and unwieldy process of due diligence.
However, simply using a data room platform for M&A is not enough to truly reduce workload, raise transparency, and close deals faster.
A detailed comparison of two major deal management platforms, DealRoom and Intralinks, proves all VDR systems are not created equally.
In fact, there are four major areas that should be explored before selecting one for your next deal:
Ease of use (including agility)
Data room maintenance
During a deal, all stakeholders should be focusing on the data and bringing the deal to completion, not worrying about the cost of the data room and its potential hidden fees; therefore, when examining the finances of DealRoom and Intralinks two key discrepancies are easily discerned.
First, DealRoom uses flat-rate pricing while Intralinks relies on per page pricing.
For example, DealRoom’s $10,000 flat-rate fee would allow you up to 100,000 pages of scanned documents.
Per-page pricing fluctuates but it can easily lead to invoices over $50,000, and can rise if you add more pages.
Not only is DealRoom less expensive than Intralinks, it also affords the opportunity for better budgeting during the M&A process.
In addition, the $10,000 flat rate fee with DealRoom permits me to upload other forms of media.
Uploading additional media with Intralinks is an additional cost.
There is also the potential for over-charging by Intralinks for things such as archiving documents with DealRoom, overcharge protection is built in to the platform.
One could even argue Deal Room’s included period of use, one year as opposed to six months with Intralinks, offers users a stronger, more flexible and economical VDR option.
The word “surprise” often has a negative connotation when it is tied to due diligence - why let surprise costs, or the inability to plan for cost, hurt your deal?
Security is most people’s primary concern when using a data room, especially for the first time.
Both DealRoom and Intralinks do a fine job with security. More specifically, both platforms provide watermarking to ensure copyright protection, the ability to restrict viewing, downloading, and printing, plus free 24/7 support.
It should also be noted, in terms of 24/7 support and security, both DealRoom and Intralinks boast strong customer satisfaction on their websites.
3. Ease of use (including agility)
Another area to explore when selecting a VDR system is how user friendly it is.
You can have the best platform in the world, but if you have to waste time and money training and retraining your staff to use it, is it really helping you?
In reality, Intralinks’ platform is not very accessible and easy to use.
Conversely, DealRoom is very accessible. In fact, it took only about 20 minutes for a new user to be trained to set up a company profile.
When it comes to basic navigation and functionality tools, both Intralink and DealRoom are on the same page. The platforms have straightforward search and filter functions, as well as indexing of site content.
An additional aspect of this category to be considered is how efficiently and effectively the system works.
Here, DealRoom wins again - its hallmark is being certified for Agile M&A, as seen through its document collection workflow and collaboration components.
DealRoom’s features allow for elimination of redundant work and total transparency, which, in turn, help to reduce deal fatigue, improve collaboration, and establish early integration.
4. Data room Maintenance
Finally, when examining data room platforms, it is critical to look at the features related to the data room’s maintenance.
Here again, DealRoom and Intralinks are very similar.
For example, both allow for bulk upload of files and folders as well as bulk printing and downloading.
Additionally, both allow users to rename and preview PDF files and to scan.
Data rooms are outstanding tools for M&A deals; however, ultimately, the comparison of DealRoom and Intralinks proves some data rooms are better than others.
With its ease of use, Agile features, and straightforward cost structure, DealRoom wins the contest when compared with Intralinks.
Selecting a VDR platform that allows you to focus on the data and close deals faster is critical to successful M&A activity, which means you need a data room that will help make your company more Agile.
Intralinks is an historically standard type VDR, but DealRoom’s commitment to Agile principles allows it to offer benefits beyond a traditional data room.
What Causes Deal Fever? What Raises the Risk?
There are several symptoms that can lead to the disease of deal fever.
One such symptom of deal fever is getting carried away in the heat of the deal. There is a lot of time and effort spent just exploring a potential deal, let along the negotiations involved. Sometimes people spend so much time and effort on exploring and negotiating the deal that they feel is must get done at all costs, while failing to take a birds-eye view in determining if the deal is really the best thing for the company.
Another symptom indicating the presence of deal fever and one that raises the risk of catching it is when certain executives become more excited about the deal and emotionally involved in the outcome than other members of the group. This can lead to inflating the deal’s potential strengths instead of also focusing on potential pitfalls. In a competitive situation, sometimes certain people want to do the deal much more than others for a variety of reasons.
Many M&A teams also use M&A software to help them source new deals. Just because a software is telling you a deal is a good idea, that doesn't mean you don't have to do the proper research.
How to Prevent Deal Fever
Great news! There are a number of proven ways to prevent deal fever and keep your company disease-free. Here are some tips to stay deal fever-free:
Perform More Research Than You Need To. You can never perform too much research on a potential deal, so we recommend doing even more than you think you need to.
Seek The Opinion Of Experienced Deal Makers. Get another opinion from someone you trust that has embarked on similar deals. What do they think of the deal? Seeking another opinion that can evaluate your potential deal without the emotional involvement will help you ensure the deal is truly one you want to pursue!
Know All Of The Potential Risks. Thoroughly evaluating the deal’s potential risks, and involving your team in the process, will help you avoid deal fever. Don’t lose sight of your basic financial calculations! Involving others in the process is essential, as you want to make sure nothing is overlooked and you can remain deal fever-free.
Resist deal fever by not overlooking the negatives that you may not want to see! If you have been the primary person working on the deal, make sure you involve others so they can help assure that you are seeing everything clearly. There should never be one person working on deal flow tracking. Likewise, don’t let personal pressures to get the deal done get in the way of looking at everything objectively. Sometimes, not doing the deal may be in the best interests of the company.
How to Tell When You Have Deal Fever
Do you have a high degree of risk tolerance? Do you have a burning desire to get the deal done, yet something just doesn’t feel right about it but you’re not sure what? If so, you may be catching a slight bout of deal fever.
Having the above feelings isn’t just exclusive to individuals, either. Many companies surveyed believe that their M&A function of getting the deal done is more important than what follows. If you’re in the M&A department, and you’re not performing M&A’s, something must be wrong, right? No, not necessarily. Inherently good deals are difficult to come by and you may have to pass on many of them before you find the right fit.
If deals contain personal agendas or emotions, or your company provides more incentives and encouragement to do the deals rather than not, than these are signs that your company may have deal fever. Recognize the signs so you can avoid deal fever and ensure you are making deals that have the highest chances of future success for your company.
Treatment, Care & Medications For Deal Fever
Below are some treatment, care and medications for this contagious disease known as deal fever:
Treatment Option 1. Ensure your deal team is incentivized for long term success, and not just for completion of the deal.
Treatment Option 2. Have objective, experienced observers review the deal specs, including all of the potential negatives of doing the deal. This way you can help ensure you’re not overlooking potential pitfalls.
Treatment Option 3. Let post-close executives have direct input into whether or not the deal goes through
Medications For Deal Fever. Create clear action steps that are to be taken when considering all potential deals. Create a set of red flags, or things to be looked at more closely when they occur. Finally, a healthy dose of objective observation by people not directly involved in the process will both help prevent and cure this debilitating disease!
A very important aspect in our guide on deal fever is to cultivate a business culture in which you have both risk tolerant and risk averse individuals on the team, with both groups having equal say. When both groups sign off on a potential deal, and it is also reviewed by an objective observer, you know you might have a winner!
Don’t Underestimate the Power of Diet, Exercise & Rest
One of the most important ways to prevent deal fever that is often overlooked is to ensure you have a good diet, and are getting enough exercise and rest. Doing so will keep your mind and body in tip top shape, and will help alleviate some of the pressures incurred from pursuing and evaluating a potential deal.
M&A deals are complex transactions that often go at a very fast pace and can also be emotionally charged, so ensuring you’re eating well, exercising and getting enough rest can help counteract the pressures of working on the deal.
Many M&A management can sometimes lack a truly accountable leader to oversee the process. Having a great leader, coupled with the goal of long term success instead of short term, are the highlights of the best things to do to not get infected with this crippling disease. Set the criteria for success and focus on that more than focusing on doing the deal just to get it over with. Make sure your team is incentivized on long term goals and are not acting out of the fear of “what if we don’t get this deal done.”
If you and your team are currently managing M&A transactions, check out DealRoom's M&A virtual data room and project management software. DealRoom's platform also includes pipeline and integration management, which helps teams organize deals for their entire lifecycle.