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2023-06-08

Private Equity Analytics: Supercharged Investor & Fund Management

A key advantage of data analytics to date has been the significant improvement in prospecting and identifying opportunities. By scanning the market at the level of big data and analyzing the trends that emerge across data points, firms can more effectively pinpoint promising investments, ultimately increasing the likelihood of generating higher returns.


But with all that external data available on the market now available to everyone willing to invest in it, it is less of an advantage than before. The playing field has been levelled to a large degree in that aspect.


The advantage therefore must be found elsewhere, and this is where the concept of small data or internal analytics enters the arena.


Internal performance analytics centred on your firm’s key areas of business can be more of a competitive advantage than data on the external market, the customers within it, and the macro-economic trends that impact it.


We’re not talking about management frameworks here, but actual tools and visual dashboards that paint a picture of your operations and sales pipeline using real time data. With such a system, you can see what is going on internally more clearly and on demand, allowing you to direct your attention and resources where it will make the most positive impact on performance.


Fund OS: A Private Equity Analytics & Management Suite


It is becoming increasingly obvious that you can no longer afford to rely on outdated systems like spreadsheets and older CMS platforms to provide such insights on internal data. The collection step itself takes too long, and it’s not always of high enough quality by the time it arrives on your desk, not to mention in a state that provides insights.


An example of how we have addressed this issue through our Fund OS platform is by creating a high-level overview of investments by Fund, Stage and Subscription Count.


Through this, it is possible to see where your business strengths or potential vulnerabilities exist, or blockages in the flow of funds through your onboarding process that hinder cashflows. Clicking on any aspect of the charts above, individual slices of the pie charts for example, takes you to a more in-depth chart about that particular aspect of performance. This helps to understand what is going on in detail where required.


Any judgment of these dashboards is obviously going to be highly dependent on the context you are operating in, and the lifecycle stage of your fund. But let’s go over some hypothetical examples to provide context for the power of internal analytics, which will provide a range of instances to help illustrate a use case.


Investment Funnel by Stage


In the above chart, the central “Investments by Stage” funnel is fairly evenly spread out, showing a gradual progression from Draft through to Committed. Such a funnel being bottom heavy however, might indicate a reduction in the acquisition of new investors, or the acceptance of opportunities by existing investors. Revealing this means that attention can be focused on the issue straight away, and the situation addressed quickly instead of finding out at the end of the week, month, or even quarter.


Similarly, a funnel weighted at the Draft, Submitted, or Signed stage could indicate an inefficiency in processes or even resources. This could delay investment in funds, with a potential loss in opportunity and profitability.


Investment Management Pipeline


The previous example is perhaps what we could consider an internal dashboard at the macro level. To take the analysis down a level to where action can be taken more specifically, we also have a pipeline visualisation showing where each customer is at each stage of the deal flow onboarding process.


This view allows you to see exactly where each deal is and the value of it. This high-level observation point, like before, allows you to direct your attention and resources precisely where they can improve performance.


Each tile in the above image can be investigated easily with the click of a mouse, showing you details about the investment, activity on the engagement, what documents have been submitted (or not) and help you to decide on what action to take next to progress individual deals.


This level of detail is of course where your investment managers will focus, but having access at both macro and micro levels like this keeps you informed and aware of the situation if and when you need it. It also allows your team to see where they are, helping them to stay on track with goals and objectives, observe their own pipeline performance, and direct their efforts where that performance can be improved.


Asset Class Investment Management


In light of the growing importance of data analytics in private equity, the Asset Class Fund OS platform offers a very realistic potential to seize a competitive advantage through internal performance improvement.


As we have described above, one of our key advantages is how platform integrates advanced analytics and dashboard reporting, empowering you and your team to make data-driven decisions at every stage of the investment process.


In addition to this, it also streamlines private equity onboarding, fund management, and document management, each of which ultimately enhances efficiency and reduces the time required to complete these tasks. Our platform's pre-filled documents and seamless DocuSign integration also simplify the document review and signing process for clients, all presented within a fully branded investor portal that helps maintain your firm's branding strategy.


By leveraging our platform and using the features outlined here, the insights gained will help to keep you ahead of potential issues, uncover growth and cost reduction opportunities, ultimately helping to improve ROI.


Talk to us today by booking a no obligation meeting below and let’s work together to upgrade your internal analytics capabilities.


Interested in learning more?

Reach out to us for a personalized demo

Interested in learning more?

Reach out to us for a personalized demo

Interested in learning more?

Reach out to us for a personalized demo

Interested in learning more?

Reach out to us for a personalized demo