Virtual data rooms let you store and access lots of documents in the cloud--thousands and thousands of them: Think souped-up versions of Dropbox for the corporate user.
Your customers will do complex transactions in which huge amounts of information change hands (think financial deals and lawsuits). Those transactions are sensitive and complicated, so virtual data rooms let users determine who is allowed to see what, and many provide detailed tracking services. They replace the physical "document rooms" that many law firms and financial companies used to employ during deals.
VDRs clocked $600 million in 2012. That's expected to balloon to $1.2 trillion by 2017, according to researcher IBISWorld.
There is big-ticket potential...
Companies doing a one-time transaction like an acquisition or bankruptcy won't offer much repeat business--that makes VDRs different from other software-as-a-service models. But the going rate is about 85 cents a page. That's big money for transactions that require thousands of pages of documents.
...But the big dogs know it
Watch out for Merrill and RR Donnelley. Some law firms have proprietary services.
Who's buying?
Private equity and VC firms aree interested. They also happen to be big users of VDRs. Other potential investors are software providers and Web hosting companies.