5 Reasons to Reconsider Salesforce for Your Fund Management Software

Why the Leading CRM Needs Altvia

Many firms reach out to Altvia after having tried Salesforce’s out-of-the-box functionality as a substitute for true fund management software and find that the system doesn’t work for alternative investments

This isn’t to say that Salesforce doesn’t have powerful features—some of which are applicable to this industry. In fact, our data management tool is built on the Salesforce platform. 

We chose to partner with Salesforce when we developed AIM, and have continued that partnership because the system’s robust infrastructure allows us to provide a premier software solution tailored specifically for private equity.

Salesforce Alone Isn’t True Fund Management Software

We’ve found that there are five primary reasons that Salesforce, straight out-of-the-box, does not work effectively for fund management. Some firms certainly use it for that purpose, but the key is using it “effectively.” 

How much time do those organizations waste each day/week/month on inefficient processes, miscommunications, and functionality “workarounds”—time that could be spent on more productive tasks? It’s an important question. The answer is dictated, in large part, by these five factors:

  1. Salesforce is designed for “typical” businesses that sell products and services.

Salesforce out-of-the-box comes with standard objects such as Leads, Accounts, and Contacts. It doesn’t include objects specific to fund management software that support deal flow and investor communications.

  1. The terminology and fields are not specific for fund management.

Fund management and purpose-built fund management software use a unique vernacular to describe both the stages of fundraising and the stages of committing to a deal. 

Salesforce out-of-the-box uses traditional sales-related terms such as “qualified” or “booked.” This forces users to adapt to the generic language, which creates a confusing and ineffective fund management system.

  1. Connections between relationships aren’t tracked.

Success in the alternative asset management space is based on the quality of the relationships that you maintain with LPs and fund managers. Salesforce out-of-the-box doesn’t allow you to track relationships and the connections between relationships to the extent that most fund managers require and that true fund management software does. This results in gaps in information and connections that might derail a deal.

  1. Funds can’t be tracked independently from accounts.

Out-of-the-box, Salesforce can’t differentiate between an account and an investment that an account might make. This means that if an account could potentially make an investment in more than one of your funds, Salesforce would consider those two investments as two distinct accounts. As you can imagine, this creates serious confusion in the deal management process.

  1. There’s no distinction between funds in different states.

In a fund management CRM system, most fund managers like to keep a record of not just the funds that they are considering, but also the funds that they passed on or funds that they did not consider. Out-of-the-box, Salesforce lumps all opportunities into one sales funnel. This is a limitation that fund management software shouldn’t have.

So, again, Salesforce is the perfect foundation for fund management software—it just isn’t the perfect fund management software by itself.

Fund Management Software from Industry Experts

Salesforce does not, of course, claim to have extensive expertise in fund management or fund management software. But they don’t have to. At Altvia, fund management software is our sole focus and a solution that we’ve been providing to industry professionals for over a decade. 

Altvia’s integration with Salesforce creates powerful synergy that gives users the backend horsepower and frontend finesse they need to do their job efficiently and effectively. 

The solution enables fund managers to track the interactions of investments, monitor portfolio performance, and create integrations with other systems that give them a competitive edge over firms that continue to just “get by” with a less-than-optimal solution.

Is Altvia the right fund management software solution for your firm?

Contact us and let’s talk about your challenges and how we can address them.

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.

investor relations