10 Reasons Excel Falls Short for Fund Managers

Deal-PipelineThe foundation of fund management is accessible, accurate information. To effectively implement an investment strategy and manage portfolio trading activities, fund managers need to be able to act quickly and seamlessly in collaboration with others on their team.

Many firms are still stuck in the Excel spreadsheet days. Unfortunately, in today’s fast-moving markets and with growing assets under management, Excel just doesn’t cut it. As firms quickly outgrow their use of Excel, they are moving to what we consider the foundation of the work that Private Equity and VC firms do, a sophisticated CRM. 

Customer Relationship Management (CRM) systems are the base of a modern technology stack. And since the technology that firms use are only as good as their data, it’s critical to have a robust CRM is a single source of truth that supports: 

  • Key workflows
  • Contact management
  • Relationship mapping
  • Deal, fundraising, and pipeline tracking 
  • Automation of key activities (e.g., emails and task assignments)

We understand that adopting new technologies and the processes to support those technologies can be difficult. But we have seen first-hand how proper technology in the form of a CRM, like Altvia, can superpower fund management. We’ve also witnessed how old-school tools like Excel fall short. While Excel spreadsheets are good calculators, they don’t satisfy the needs of today’s fund managers. 

Here are ten areas where Excel falls short for fund managers.

1. Collaboration

Excel files tend to be built for specific purposes, such as an investor list for newsletter emails, or a targeted fund list. Disruptions to collaboration take place with this approach. Often, the information is pushed out of the “master” list but never comes back with corrections or updates. As a result, multiple copies of the same list are maintained throughout the firm. It’s also difficult to establish a consistent list since multiple people can’t work on the same file simultaneously.

2. Data integrity

When there are multiple people working on the same file, that file often becomes corrupt. We’ve all been there, when the Excel spreadsheet gets returned from a colleague and the formulas are broken. Or, because of the back and forth sharing of the file across different software versions, the file becomes fully corrupt and therefore unusable. This situation requires someone to revert back to an older version of the file and lose all of the recent updates. It’s an incredibly frustrating, time-consuming, and inefficient reality of Excel spreadsheets.

3. Storage

Unless your firm has solid processes in place that everyone adheres to, the issue of file location can become a big problem. As different members of the teamwork on and update an Excel file, it might get saved on someone’s machine, and not where it should be stored for everyone to access. This issue creates confusion and wasted time when people have to hunt down the latest version because it’s not stored in a central location. 

4. Control

Excel files can get really big and complex. With so many connected cells and formulas, over time, it becomes difficult to diagnose the cause of an error. Fund managers can spend hours just hunting down the wrong character in a formula that’s causing problems.

5. Connectivity

With information stored across different sheets and files, it’s difficult to see a holistic view and connections in the data across all of the sources. This issue creates gaps in insights and slows down a fund manager’s ability to make effective decisions.

6. Stability

Many fund managers who use Excel store connected information across multiple, interconnected sheets. Over time, this becomes precarious. Each sheet gets more complex, the connections become brittle, and the stability of the data and information is less reliable.

7. Access

Unfortunately, Excel imposes constraints on different users depending on their license, operating system, etc. This makes file access difficult at times and due to constraints in a file, these access issues can block users from getting to the information they need to do their jobs.

8. Reporting

An important part of your job is reporting. When using Excel to manage data, it can take a full day or more to put together a report that answers all the required questions of the firm. Additionally, without structured and normalized data, advanced reporting is nearly impossible.

9. User Experience

Many fund managers have lots of experience with Excel. They were likely trained on the technology at some point in their education or careers. Yet, the user experience can still trip up the savviest Excel user. With the speed that fund managers need to move at, there’s no time to fight with a pivot table, or Google errors happening within a macro.

10. Human Capital

Managing work in Excel is a big waste of human capital. In the time spent trying to bend and shape Excel to get it to work for their jobs, fund managers could be out hunting, building relationships, and staying on top of industry trends.

The switch from Excel to a purpose-built technology for fund management is a huge boon, not only for the individual but also for a firm. As an example, Crestone Capital saved hundreds of hours of work by moving away from Excel and onto Altvia. 

With increasing assets under management, Crestone sought out a system to support business growth, create operational efficiencies, and better serve its stakeholders. 

The team was using a set of disparate systems including Excel sheets, PDFs, and Microsoft Dynamics. It was cumbersome to gather all client data into a central location, and the group had difficulty leveraging Microsoft Dynamics across the organization to accomplish basic tasks.

In their move to Altvia, using the CRM and Investor Correspondence, Crestone was able to streamline operations, free up team time, and improve investor relationships. Read more about the experience here.


Altvia helps private equity firms move past Excel and operate more efficiently, securely, and effectively. If you want to learn more about how Altvia can support your firm, request a demo.

A traditional crm was built for general ‘customer’ scenarios

Software platforms have made the world a better place by making work a better place. Indeed the world is better off when people enjoy their jobs even marginally more, and workplace applications on big CRM platforms like Salesforce.com have done that and much more.

But the potential that platforms like these offer presents diminishing returns: once the platform provider has engineered too many industry specific components into its platform, its usefulness for other industries begins to be threatened, and with that so do the usefulness of the component tools built into the platform.

So it is with the CRM category that Salesforce.com has defined: it is generic enough to work for many industries, and yet still offers the potential for others to round off the edges and nail more vertically-oriented and extremely tailored software solutions.

Private capital markets are actually a great demonstration of this dynamic. Where generic CRM platforms simplify — appropriately so — to assume there’s a business, a customer, a sale, and service of that customer, there are a few industry-specific pieces that are missing.

Take for example, that investors become customers by investing through legal entities the GP raises. It’s a subtle but important nuance that just doesn’t make sense at a platform-as-a-service level (because it’s overly complicated for a simple one-time sale that many industries require), but which can easily be added without 10 years or software engineering. Once provided, the rest of the platform’s components become tremendously powerful again and you’re set to take over the world.

As a traditional CRM in our pillars methodology, these nuances must be present to properly account for investors in these legal entities, potential target companies and which are owned by these entities, the context of all interactions with these parties (as well as the appropriate overlap, ie co-investments), and how you’re arriving at finding these opportunities on both sides of the equation, such that you’re able to piece together what’s effective and what’s not. Not just because we say so, but because these are the very relationships and data that are key to the motivation behind a CRM in any industry.

It’s critical, too, that the valuable publicly-available information that helps to enrich CRM systems and save users painful steps of entering it themselves is fully-integrated at the platform level.

Again, look no further than the 3,000+ pre-built integrations that Salesforce.com — the creator of the CRM platform concept — has at a platform level to do so, and which only exists by way of holding just short of overly-specifying certain industry workflows that would present challenges to properly integrate.

Stakeholder reporting and communication (investor relations) draws on a range of datasets

The traditional “customer service” model of CRM systems once again makes overly-simplified assumptions about the customer relationship when applied to private capital markets.

In fifteen years I personally have yet to hear the terms “warranty” or “service call” in this market because it’s just not the same. But make no mistake, as uncomfortable as it may be to say aloud, customer service is more important now than ever and it’s constantly happening; the industry is, after all, considered to be a financial “service”.

As it turns out, that service is primarily information-based — it’s driven by data and takes the form of reports and analysis that drive decisions, and then end up again in investor-facing reports and analysis.

The foundational elements of a private capital markets CRM must be built such that they accommodate this data (like we discussed above), but so too that it can accommodate additional supporting data that investors (customers!) need in the context of service.

Oftentimes this supporting data — financial metrics and time-based values, for example — is believed not to meet the traditional definition of CRM and the natural thought is “well, better do this in Excel!”.

While I happen to believe Excel is still the greatest software application ever built, its introduction to this value chain we’ve discussed herein actually creates the problem many firms suffer from: key data needed to provide customer service (again: effectively the entirety of a firm’s reports and analysis) is now in disparate systems and detached.

Both of those dynamics are important and distinct: not only is this supplemental data disparate, but when brought together there is no logical association that can be made between the two data sets.

Allow me, then, to make the point very simply: not only can this financial and time-based value data (you may be thinking about is as “portfolio monitoring” or “accounting”) be a part of a CRM, it is arguably the most important part of a CRM because it’s at the core of what providing service to the customer entails — information that comes out of data!

Firms need a digital method to engage stakeholders (ie investor portals)

Investor portals are not new; in fact, for many of us — including myself — they conjure up horrifying nightmares in which we’re aimlessly guessing at folders to find the newest document we need.

So in lies the opportunity: not only have the portals we’ve come to hate not simplified the process of acquiring information, they’ve failed to create an entirely new experience that is “customer service” driven.

To be fair, this is not a B2C market where you’d be long out of business for not having focused on customer service and thus the customer’s technology-driven experience. But don’t expect to be around too much longer if you aren’t thinking about this shift.

Today’s institutional investors increasingly expect this same consumer-like experience, and a massive opportunity is being missed by not providing it. It’s not about providing them the experience they desire; it’s more about the ability to measure engagement that is had in return.

Put simply: what’s keeping the market from providing this experience is the availability of the information that’s required to create the service that provides the experience.

If you’ve hung in this long, you know that by focusing on your CRM, you have the data that’s required to manage the customer relationship and the technology-driven experience through which that information is shared to create a differentiated and opportunistic customer experience.

private equity crm