Author: Josh

2024 Outlook on Private Market Investment Dynamics: Key Takeaways from ACG St. Louis DealSource

Posted on February 8, 2024 by - Deal & Pipeline Management

Introduction

The recently concluded Association for Corporate Growth (ACG) St. Louis DealSource event shed light on the ever-evolving dynamics of the private market landscape, offering valuable insights into market trends, fundraising challenges, and the overall outlook for the Private Equity and Venture Capital industries. In this blog, we’ll delve into key findings from the event, providing a snapshot of the current state of affairs in the world of private capital markets.

Risk-Aversion

There seemed to be a common theme amongst attendees and speakers recommending the avoidance of risky bets in unconventional industries for your business. The prevailing sentiment was to stick to more established and stable sectors, reflecting a cautious approach to investment.

Exploring New Financial Partnerships 

While there is caution in exploring new industries, the same sentiment does not rain true for industry players seeking new resources to find new deals, and this extends to banking relationships. For example, pursuing new banking relationships is indicative of a broader strategy to diversify and fortify financial partnerships. In fact, founders are now choosing to solicit bankers earlier in the investment process, signaling a more strategic and collaborative partnership approach. 

Fundraising 

As we all know, raising capital continues to be a challenge for fund managers. Investors are scrutinizing opportunities more thoroughly, emphasizing the need for a compelling and well-defined value proposition. And as LPs have been displaying more skepticism and caution in committing capital, fundraising has become a more gradual process with a focus on strategic and steadfast GP-LP relationships. This demonstrates the importance of building trust and establishing credibility, especially for emerging fund managers seeking investment. 

Portfolio Pressures 

Interestingly, most attendees were in agreement that there is no extreme pressure to sell existing assets. In fact, there is a discernible shift in focus towards growing the current portfolio. LPs are encouraging GPs to deploy capital strategically and maximize returns within their existing investment pool.

Conclusion:

Overall, despite the challenges, there is a positive outlook in terms of deal flow. Attendees expressed optimism about the increasing opportunities in the market. The rise in deal flow is seen as a promising sign, indicating potential growth and prosperity in the coming months. This is just further evidence of the underlined dynamic nature of the investment landscape. Adaptability and strategic decision-making are key as industry players navigate challenges in the market. Luckily, Altvia is here to help your firm evolve and stay informed to achieve differentiated success. Talk to one of our experts to learn more about our deal flow software solutions: https://altvia.com/book-a-meeting/

Data storytelling: how to win LPs and influence them

Posted on January 8, 2024 by - Investor Relations & LP Experience

How can data be used more effectively?

First off, data should be used to help drive decision-making. No question about it. The reality, though, is that good investors have instincts and don’t make decisions purely based on data. When you combine that with how much is available after making an investment decision, the big opportunity for data is in telling a story. At the end of the day, it’s about building trust between GPs and LPs. There are regulatory requirements for what should be reported and how it should be laid out, but that’s only a small part of it. It’s about sitting down together and saying: here’s the story. When you have data and flexible ways of understanding it, that helps you demonstrate and tell the story of why you’re truly different. And that’s what LPs are dying for – to be shown something different.

Where do LPs most want to see improvements in communication from GPs?

Recently, we’ve had a lot of open and honest conversations about response speed – something that historically nobody has wanted to talk about. I’ve been an LP and when you make a request, you know the timer has been set. Once set, GPs are concerned that they’re now being judged, and for good reason, because LPs have confirmed time and time again that they are! The issue for GPs is that they can always share more information and take longer. But if it takes too long, there’s a point at which the information you’re sharing has diminishing returns. LPs seek trustworthy managers, and trustworthy managers should offer breadth, depth, and speed.

How do CRM needs in private equity differ from standard platforms?

For the most part, people view a CRM as a Rolodex-plus. But we’ve arrived at the belief that the customer – the LP – is the only reason anybody is doing anything. LPs are buying a service, and what the customer gets is information about the service and the investment decision.

So, managing the relationship with your customers is about understanding your investment portfolio, the deals you are looking at, performance, growth, risk, and so on. We’re focused on enabling the full picture. As such, our CRM is about bringing data across the firm together and putting it into a helpful format, so that the people managing the relationship can create a better experience for the customer.

Where in the investment lifecycle should GPs focus?

I think GPs are feeling that they need to get it together across the board – or are worried that somebody else is getting it even more together, and faster. Some are running around trying to create a façade that they’ve been diligent and systematic, but they are leaving gaps. LPs are after greater detail, and are judging GPs on how they respond. Whether it should be or not, the reality is that it has become a proxy for how well the fund is run and managed.

Data is crucial to decision-making. What are the main issues with GP data?

The focus is on proprietary data. If we all have the same data, it’s just a race to slice and dice it. So the focus is on proprietary data, on quality and accuracy, and on how you get it. Lots of data is still encapsulated inside documents, in poorly formatted text strings and lengthy email chains, so the focus is on harnessing all that data efficiently, no matter where it is. There are technology tools to help with both accuracy and quality, detecting and fixing issues with high confidence. But those tools don’t get used if the data is never captured from an inbox, document, or even from a verbal communication.

What technologies do you think will have the biggest impact over the next few years?

We’re having an AI moment and everybody feels they need to say something. That’s how we know that there’s something truly there, but also that there’s a lot of noise. What we’re really interested in is wading through the noise to find exactly where AI can solve real problems in novel ways. Right now, much of the noise is coming from AI being a solution looking to find problems to solve. But these periods of upfront mania are well understood among psychologists and analysts, and they come at the beginning of innovations that will have long-term value.

Private Equity Industry Recognizes Altvia with Prestigious ‘Best New Solution Provider’ Award

Posted on October 26, 2023 by - Uncategorized

Based on a widespread survey of more than 500 GPs and other key private equity industry participants, Altvia was recognized, for the third consecutive year, by Private Equity Wire US Awards as “Best New Solution Provider” for its alternative investments software.

DENVER, October 26, 2023 /PRWeb/ – Altvia, the leading technology provider in alternative investments announced it has been awarded “Best New Solution Provider” by Private Equity Wire’s US Awards 2023. Altvia drives innovation and transforms data for GPs to deliver a best-in-class LP experience through a purpose-built and fully integrated private equity CRM platform.

“We are honored to receive the Best New Solutions Provider award from PE Wire this year,” said Brie Aletto, CEO of Altvia. “We take great pride in this achievement as it reaffirms our dedication to delivering innovative technology solutions to our clients, which subsequently pushes the private capital market forward as a whole. This accolade not only recognizes our past efforts, but also inspires us to continue to push the boundaries with our products to uncover what is possible in the world of private equity technology.”

Alternative investments solution Altvia wins the Private Equity Wire 2023 Best new Solution Provider award.
Winners were announced last night during an awards ceremony and networking event held at The Penn Club in New York.

The Private Equity Wire US Awards recognize excellence among private equity fund managers and service providers in the US across a wide range of categories. Nominations for the service provider awards are based on a widespread survey of more than 500 GPs and industry leaders. Winners were announced last night during an awards ceremony and networking event held at The Penn Club of New York.

With a commitment to excellence in service, product innovation, and having a deep understanding of the unique needs of the industry, Altvia has become a trusted partner for hundreds of world-class firms seeking to optimize their processes and create a competitive edge in this competitive market. Acquired by Marlin Equity Partners in 2022, Altvia has increased its research and development investment to focus on transforming the way GPs deliver continuous value, real-time decision support, and secure communications to their valued investors.

With winning “Best New Solution Provider,” Altvia is proud to add a fourth Private Equity Wire Award alongside their dual wins of “Best Fundraising Solution” and “Best Secure Workflow Management Provider” in 2022 and “Best Secure Workflow Management Provider” in 2021.

To learn more about Altvia’s private equity CRM, alternative investment management software, and deal flow management solutions, or explore visit: https://altvia.com/platform/

About Altvia

As the technology pioneer for private capital markets, Altvia continues to drive innovation for GPs to deliver a best-in-class LP experience. Altvia is the first and only solution to successfully build a fully integrated CRM platform atop Salesforce – empowering private equity, venture capital, and other alternative asset professionals to streamline operations, enhance investor relationships, and extract valuable insights from their data. Learn more at www.altvia.com.

About Private Equity Wire

Private Equity Wire provides highly relevant and actionable information for GPs, service providers, and LPs.

2023 PEI IR Forum Recap: Scaling Up your Investor Relations, Marketing, and Communications Tech Stack

Posted on October 13, 2023 by - Investor Relations & LP Experience

I’ve had the chance once again to attend another outstanding Private Equity International Investor Relations, Marketing, & Communications Forum. I’m on the record as believing this is the premiere event in our market and, while this was the first time attending the west coast version in San Francisco, that sentiment remains the same.

There is no event I regularly attend that is nearly as collaborative and as audience-focused as the PEI events. The audience produces the overwhelming majority of the event’s content, and together with the spirit of collaboration PEI has instilled culturally in these events, there’s just simply no replacement for how much can be learned and is actionable coming away from these events.

I’ll share all sorts of learnings, but before I do, let me once again acknowledge the evolution of these events. From the first I attended back in 2012 or so, the makeup of attendees has changed in interesting and encouraging ways. First and foremost, it’s very rewarding to see so many women now in these roles and attending these events. It’s one of the few events in this market where you’ll find that women make up the wide majority of attendees, but — as one poll during the event uncovered — many of the people in these roles (and specifically the women that are in them) come from diverse backgrounds where financial expertise and experience is not necessarily prioritized. Instead, the people in these roles are coming from strategic marketing and communications roles and being hired, in many cases, to establish this function inside private market firms. This is something of a departure when compared against 2012, when it seemed to be attended by more men than women, and in many cases those men were adding the responsibility of marketing and communications to other roles they also owned. If nothing else, it suggests that private market firms have seen these roles and these functions as strategic and have staffed accordingly.

Let’s talk about the outstanding content. If the makeup of the attendees and the roles they’re in weren’t enough to convince you that private market firms are seeing marketing and communications as a strategic opportunity, the content certainly is. It is within the sessions where you can find folks being surprisingly transparent about strengths, weaknesses, opportunities, and even threats. Most of the sessions are intentionally off the record so as to encourage this sort of transparency, and is appreciated by all. You’ll hear tough questions, honest answers, and it’s all guaranteed to be thought-provoking.

For me there were a number of key takeaways:

1. LPs have never asked for more transparency and GPs have never worked so hard to provide it. It’s convenient to be a software provider at this event because software, together with third-party services and many of the vendors who attended, are the obvious places to turn to find leverage for doing so, and the opportunity where these dynamics meet is massive.

2. Investor Experience matters. There was an entire workshop session on the topic, and the short and the sweet is that it goes way beyond transparency to include consideration for offering LPs co-invests as well.

3. Marketing and communications to LPs and the LP prospect universe is a full-contact sport that many firms are aggressively resourcing to go after. Hiring seasoned communications professionals to institutionalize this as a practice inside their firm. There were workshops on proactive social media strategies, and one on considerations for how to market the private markets to Gen Z. There were sponsoring vendors that provide services on how to develop these strategies, those who provide video production services, and everything in between. The whole domain has changed markedly and I’m here for it.

4. Impending regulation stands to impact the entirety of this domain, and while there are more questions than answers in certain regards, private market firms are embracing change in how they market, how they communicate performance, and how the systems and processes they currently have in place will likely have to change to accommodate new regulation.

It would be impossible to convey everything discussed at PEI’s 2023 west coast event, but that’s why you’ll just have to attend for yourself next year!

Passthrough and Altvia Launch First CRM-Integrated Investor Onboarding Solution, OnboardingBridge

Posted on September 6, 2023 by - Uncategorized

Enterprise leaders in fund workflow automation create multi-use-case and multi-purpose onboarding solution for fund managers.

September 6, 2023 09:00 AM Eastern Daylight Time

NEW YORK, NEW YORK – (BUSINESS WIRE) – Today, Altvia and Passthrough announced the launch of OnboardingBridge, the first solution to fully integrate a CRM with an investor onboarding solution, so that General Partners can provide a best-in-class investor experience.

Passthrough is a leader in fund workflow automation for investors, fund managers, and other fintechs. They enable investors to speed through the onboarding process, allowing fund managers to close capital commitments in minutes instead of weeks. Altvia is a market-leading software provider of CRM, Data Analytics, LP Portal, and Data Room. Their end-to-end solution, and unmatched expertise, help alternative investment firms seamlessly evolve and manage complexity as they grow, multiply funds, and expand their LP base. Since its initial announcement earlier this year, the strategic partnership with Altvia has enabled GPs to improve relationships with their LPs by providing a seamless, digital experience throughout the entire onboarding process.

Altvia’s OnboardingBridge powered by Passthrough, is the first solution to fully integrate a CRM with an investor onboarding solution. This strategic integration delivers rapid data processing, minimized onboarding risk, and expedites fund closures. This allows fund managers to close a raise weeks or even months faster by establishing one source of truth for investors. Altvia’s AIM CRM and Passthrough seamlessly transfer data back and forth by way of OnboardingBridge, which provides GPs with the most elegant and streamlined LP onboarding solution in private markets.

“Our objective has always been straightforward: to solve investor onboarding at the infrastructure level. By partnering with Altvia earlier this year, we leapt closer to that goal,” explains Tim Flannery, Co-founder & CEO of Passthrough. “Through OnboardingBridge, GPs can now prioritize relationship management without the burden of data administration. While Passthrough streamlines document completion and data system integration, GPs can get back to running their funds and utilizing readily accessible investor data.”

With OnboardingBridge, Passthrough and Altvia users will be able to efficiently utilize, import, and export accurate, pre-populated investor sub doc data for immediate use in Altvia’s AIM CRM. Additionally, rapid and seamless data transfer minimizes business delays, enabling teams to accelerate fund closing timelines without additional workloads. Its real-time visibility empowers firm-wide collaboration by providing a live onboarding status to investor relation teams within Altvia’s AIM CRM with no additional work.

“OnboardingBridge is a first-of-its-kind solution that’s directly addressing many of the data administration problems plaguing GPs and LPs everywhere,” says Jeff Williams, Altvia’s Chief Strategy Officer. “Especially as firms and GPs continue to grow and expand their LP base – we want to be providing them with the tools they need to seamlessly evolve and manage complexity. With the help of Passthrough, we’ve been able to do just that.”

“We’ve achieved data continuity throughout our fundraising process with OnboardingBridge,” says Sara Anderson, PennantPark’s Investor Relations Product Manager. “Because our fundraising and investor data seamlessly flows between our CRM and sub docs now, we’ve been able to use the time previously spent on manual processes for building relationships with our LPs, giving them a better experience all round. We can close our raise faster and our team is happier.”

To learn more about Passthrough and Altvia’s partnership, and how to get started with OnboardingBridge, please visit: https://passthrough.com/altvia or meet both teams in person at Private Equity International’s Investor Relations, Marketing & Communications Forum, held at Parc 55 in San Francisco on September 20 and 21.

About Passthrough
Passthrough turns workflows like subscription document execution into solved problems – seamlessly manages subscription document distribution, execution, and compliance in minutes. Founded by former leaders from the Carta Investors Services team Alex Laplante, Ben Doran, and Tim Flannery, Passthrough provides an integrated platform solution that makes the subscription document process turnkey for investors with replicable and verifiable identity information built in for future use. In addition to subscription documents, Passthrough also offers a comprehensive AML & KYC compliance product which collects information from investors so fund managers can remain compliant.

About Altvia
Altvia is a market-leading provider for CRM, investor and deal management systems specifically built for Private Capital Market firms. The company’s cloud-based platform (AIM, ShareSecure, Correspond, and Answers) is transforming the way GP’s deliver continuous value, real-time decision support, and secure communications to their valued constituents. Marquee firms across multiple verticals trust Altvia to optimize operational functions and enable critically important communications. Altvia is a Marlin Equity Partners portfolio company.

Media Contact:
Kathy Osborne
press@passthrough.com

Passthrough and Altvia Announce Strategic Partnership for Streamlined Investor Onboarding Process

Posted on April 21, 2023 by - Uncategorized

Enterprise leaders in fund workflow automation partner for multi-use-case and multi-purpose solutions for fund managers

April 11, 2023 09:00 AM Eastern Daylight Time

NEW YORK–(BUSINESS WIRE)–Today, Passthrough and Altvia announce a new strategic partnership that will create a modern approach for Investor Relations teams to leverage data and technology to convert their fundraising funnel faster. Passthrough, a leader in fund workflow automation for investors, fund managers, and other fintechs, and Altvia, a purpose-built fund lifecycle platform to facilitate world-class partnerships between LPs and GPs, will be releasing an API integration later this year.

“By connecting with our infrastructure, Altvia’s fund managers can provide simplified investor onboarding relying on software instead of pen & paper so they can close their funds weeks or months faster.”Tweet this

Altvia is a market-leading provider of CRM, analytics, LP Portal, and Data Room software specifically built for Private Capital Market firms to help them gain visibility and insight with a real-time view of performance and activities across fundraising, investing, and LP engagement. Altvia’s end-to-end solution, and unmatched expertise, helps alternative investment firms seamlessly evolve and manage complexity as they grow, multiply funds, and expand their LP base.

Passthrough enables investors to speed through the onboarding process, allowing fund managers to close capital commitments in minutes instead of weeks. They turn workflows like subscription document execution and KYC/AML into solved problems – seamlessly managing subscription document distribution, execution, and compliance.

“We think investor onboarding should be solved at the infrastructure level and over API, which means we don’t need to be another destination for fund managers and investors to constantly check. Instead, we power the private capital market with a default investor onboarding tool for fund managers,” says Tim Flannery, Co-founder & CEO of Passthrough. “By connecting with our infrastructure, Altvia’s fund managers can provide simplified investor onboarding relying on software instead of pen & paper so they can close their funds weeks or months faster.”

Today, Altvia clients can sync historical investor information with Passthrough for a seamless document completion experience. With the upcoming integration, the information will sync live so investors will automatically be added to Passthrough’s investor onboarding solution for electronic subscription documents and KYC/AML offering. As part of the KYC/AML offering, Altvia customers will also be able to screen investors against sanctions lists on an initial and ongoing basis so they can monitor their risk.

“We are laser-focused on creating the private capital market’s most seamless and elegant investor experience technology” says Jeff Williams, Altvia’s Chief Strategy Officer. “To do that, we are partnering with best-of-breed solutions like Passthrough to provide similar experiences for our top tier client roster and their investors. The streamlined experience that comes as the result of this integration, together with Passthrough’s differentiated identity resolution data, made this partnership a natural fit, and we’re thrilled about what it offers the market.”

The initial real-time API integration will be released later this year. The strategic partnership between Passthrough and Altvia will continue to look for opportunities to extend the integration across products.

To learn more about Passthrough and Altvia’s new strategic partnership, please visit: altvia.com/passthrough.

Additionally, you can find the Passthrough and Altvia teams at the Private Equity International Investor Relations, Marketing & Communications Forum (PEI IR Forum) in NYC on April 19-20.

About Passthrough

Passthrough turns workflows like subscription document execution into solved problems – seamlessly manages subscription document distribution, execution, and compliance in minutes. Founded by former leaders from the Carta Investors Services team Alex Laplante, Ben Doran, and Tim Flannery, Passthrough provides an integrated platform solution that makes the subscription document process turnkey for investors with replicable and verifiable identity information built in for future use. In addition to subscription documents, Passthrough also offers a comprehensive AML & KYC compliance product which collects information from investors so fund managers can remain compliant.

About Altvia

Altvia is a market-leading provider for CRM, investor and deal management systems specifically built for Private Capital Market firms. The company’s mobile-optimized platform (AIM, ShareSecure, Correspond, and Answers) is transforming the way GP’s deliver continuous value, real-time decision support, and secure communications to their valued constituents. Marquee firms across multiple verticals trust Altvia to optimize operational functions and enable critically important communications. Altvia is a Marlin Equity Partners portfolio company.

Contacts

Media:
Kathy Osborne
press@passthrough.com

Cutting Edge Tech, Software, and Focus for PE and VC Markets in 2023

Posted on February 15, 2023 by - Private Equity Technology

As the new year is in full swing, it’s time for our annual predictions in Private Equity and Venture Capital for 2023! If you’ve ever seen our #RiskyBets series before, you know we’re here to make our own assumptions and push the industry forward, and it starts by reflecting on 2022.

There were many changes in 2022, but one thing that we’ve been keeping our eye on is how the markets are shifting power from GPs to LPs. We believe this is a tremendous tailwind toward our vision for how the future of the Private Equity and Venture Capital markets will operate. So with that, let’s get into our 2023 #RiskyBets:

1. TRANSPARENCY. LPs’ demands for transparency, together with their more selective manager commitments, will lead us to see fundamental changes to how GPs share information with LPs. We are already in the early innings of this – Altvia was one of the early providers that offered the ability to share dynamic, real-time data visualization within our LP Portal software product, ShareSecure. But what we’re predicting for 2023 is the next evolution. It will become more mainstream for GPs to share information and will quickly become something GPs feel pressured to do by increasingly selective LPs demanding more transparency.

2. TRUST. Differentiated GPs will go on the offensive with clarity and use improved tech to begin offering real-time, self-service data not just to existing LPs, but to prospective LPs as well. One of the things that has prevented GPs from being proactively transparent with data is the fear that comes with not understanding their own data. So, as the pressure mounts from LPs to understand this same data, GPs will increasingly move towards investing in systems that help them organize data. And while it will still be a far reach to proactively let LPs peruse through data, the early adopters amongst GPs that begin to extend trust to LPs will quickly learn that there is opportunity and tremendous uptick by differentiating themselves in the market.

3. TECHNOLOGY. Technology will play a transformative role in creating new GP-LP relationships. “Democratization” is a word that has been increasingly thrown around in this market, and while it’s a trend and perhaps not a #RiskyBets to discuss, we’re here to talk about democratization with a new tune. About two decades ago, the idea of online dating was thought to be revolutionary. People connecting via technology? No way that works. Speed up to today, online dating has democratized opportunities to build relationships and connect. The similarity runs deep within our PE and VC industry software and interfaces.

Many still believe that the thought of GPs and institutional LPs meeting via technology is unlikely, but at Altvia, we believe it is inevitable. It’s important to clarify that while having GPs connect with LPs via technology will be a more efficient way to meet, it will not cannibalize the standing practices in the marketplace. This will be a natural evolution of being more transparent and providing self-service data to current and prospective LPs. This is also a natural evolution of creating a more democratic marketplace and more efficient way to meet new LPs that are also interested in meeting GPs.

There you have it – our top three predictions and #RiskyBets for the Private Equity and Venture Capital markets in 2023. If you’re ready to stay ahead of the curve and want to benefit from digital modernization, please reach out to Altvia! Sign up for our monthly newsletter, check out the Preferred Return podcast, or follow us on social.

Jeff Williams, Chief Strategy Officer, Altvia – Jeff Williams started with Altvia in 2011, bringing with him deep technical understanding and industry experience as an Associate at a leading Fund-of-Funds, Greenspring Associates. Through his tenure, he has worked extensively internally leading various departments from product, development, and marketing and externally with clients to make the vision of Altvia come to life through the development and launch of products solving the issues facing GPs and LPs.

Have additional thoughts? Connect with me on Linkedin!

Industry Recognizes Altvia with Two Private Equity Wire 2022 Awards

Posted on October 27, 2022 by - Uncategorized

The Private Equity Wire US Awards recognize excellence among private equity fund managers and service providers in the US across a wide range of categories. Voting is conducted via an online poll of the entire Private Equity Wire userbase, where participants are asked to make their choice among the shortlisted firms in each category. The nominated firms are based on a widespread survey of more than 100 GPs and other key industry participants. Winners were announced last night during an awards ceremony and networking event held at The University Club in Manhattan. 

“We are delighted to be recognized by the industry amongst our competitors with this prestigious award. As the private equity industry rapidly adopts new technologies to drive improvements and efficiencies, we help our clients more effectively raise and deploy capital, optimize workflows, collaborate cross-functionally, and analyze performance across their investments as part of their path to the top,” commented Brie Aletto, President and CEO of Altvia, on the accomplishment. “Altvia is privileged to have strong employees and customers that have supported our continued growth and are robust contributors to winning these awards.” 

Learn more about how our award-winning solution can help you win deals in a hyper-competitive market.

About Alvtia

Altvia is a market-leading provider for CRM, investor and deal management systems specifically built for Private Capital Market firms. The company’s mobile-optimized platform (AIM, ShareSecure, Correspond, and Answers) is transforming the way GP’s deliver continuous value, real-time decision support, and secure communications to their valued constituents. Marquee firms across multiple verticals including IVP, Livingbridge, Tailwater Capital, and RCP Advisors trust Altvia to optimize operational functions and enable critically important communications. Altvia is a Marlin Equity Partners portfolio company. Learn more at www.altvia.com. 

About Private Equity Wire

Private Equity Wire provides highly relevant and actionable information for GPs, service providers, and LPs.

Record-level dry powder & economic downturns lead to new innovation cycles

Posted on October 12, 2022 by - Fundraising Strategy

Market volatility, inflation pressure, rising interest rates–we could argue that the investment landscape is even more challenging than it was a year ago. As a result, PEs report year-over-year declines across everything from deal activity to fundraising to exits. 

To maintain a competitive edge, firms are finding new strategies and sectors to innovate in, and they’re sitting on a record-level amount of funds to fuel it–$290 billion, to be exact. This record level of dry powder is putting pressure on VCs to step up their investment pace, and startup founders are being told to brace for a tidal wave of venture capital interest throughout 2023.

If the past year has shown us any indication of what’s to come, VC firms that put that dry powder to use could lead to another blockbuster investing year, as we saw in 2021. So, how can PEs best leverage that interest amidst continued economic downturns? It starts by understanding a few key takeaways from the first half of 2022 to fuel new innovation cycles and strategies. Keep reading as we outline our findings and suggestions for a way forward. 

Findings from the First Half of 2022

  1. PE Activity Stays Above Pre-Pandemic Averages

In comparing the first half of 2022 with that of 2021, PE firms announced deals have  declined by 18%. Key factors attributing to the decline include those typical in an increasingly volatile market: a widening expectations gap between sellers and consumers; reduced visibility into the overall outlook of the business; a looming recession.

But it’s not all bad news. 2021 was a record year for PE firms, representing more than $1.2t in deal activity. Whatsmore, the current deal rate still exceeds pre-pandemic averages, which could very well turn into another record-breaking year for the industry by the close of Q4.

  1. Fundraising Remains Robust 

Just as deal activity declined in the first half of 2022, so did fundraising. As of June 2022, firms had raised over $250 billion, which is about 15% short of the same period last year. However, in contrast to last year, which saw a spike in new growth strategies and activity from smaller managers, 2022 has been dominated by large buyout funds.

Given the decline in public markets, it’s possible that fundraising will continue to drop throughout the remainder of the year. Thankfully, LPs have flexibility in managing those imbalances, and PE firms are unlikely to feel any capital constraints in the foreseeable future.

  1. A Mitigated Pressure for Exits

Perhaps one of the most significant changes year-over-over is the number of exits, which fell roughly 35% in the first half of 2022. This decline was driven almost entirely by industry-specific limits to achieve those public exits.

As an example, sales to SPACs represented nearly one in five exits in 2021. However, strong headwinds in that market have made it almost impossible for PEs to sell to SPAC vehicles. As a result, exits in that sector have declined by 94%. Nonetheless, the pressure for exits has been mitigated thanks to the strong market of the past 18 months. 

Spark New Innovation Cycles to Stay Ahead

The past decade has been heavily focused on growth-oriented investments. But, with today’s uncertain landscape, including factors like rising interest rates, shifting gears is essential for success. As the role of operational value-add quickly emerges in the spotlight, firms should push to shift from “growth-at-all-costs” to “value over volume” strategies as a way to leverage dry powder and stay ahead of the competition. 

Where a firm can uniquely add value varies by sector and portfolio. To hone in on areas to spark innovative solutions that create lasting value, PEs must ground themselves and go back to their roots. This means taking a “roll up your sleeves” approach to dig deep into areas like supply chain management, pricing optimization, digital transformation, and working capital–the key areas that will be the new primary drivers for returns.

Altvia’s PE-specific solutions can help develop, streamline, and optimize your firm’s value creation strategies, from streamlining business intelligence data to providing actionable reporting and insights throughout your funnel. To see it in action, request a demo with a member of our team. 

Today’s Differentiated GP: Modern Data & Technology Strategies – Webinar Recap

Posted on October 10, 2022 by - Private Equity Technology

Recently, Altvia CEO Brie Aletto and Chief Strategy Officer Jeff Williams were joined by Cendana Capital Partner Kelli Fontaine for a webinar on effective data and technology strategies in today’s LP market. Titled Today’s Differentiated GP: Modern Data & Technology Strategies, the live, online event was attended by more than 250 people and provided a wealth of insights in key areas.

Data Models

The panel starts by discussing the surprising fact that two-thirds of institutional investors surveyed believe that GP information is “less than good,” and 92% feel it’s “less than excellent.” Kelli makes the point that given those numbers, organizations shouldn’t be targeting “industry standard” leveraging of data, as that’s a very low bar today. You can (and should) stand out by exceeding that standard.

The panelists agree that fund management is a business, so you have to think about how you want to run it. And as a GP, you’ve got to understand not just how individual companies are doing, but also how your portfolio is performing in general.

As Jeff says, the overriding issue is that failing to fully leverage your data to offer a superior “customer experience” is a missed opportunity. And Kelli adds that you can’t know “what’s going right and wrong” with a portfolio if you don’t use data wisely.

Systems & Infrastructure

The session continues with Jeff explaining Altvia’s “PEriodic Table of Technology” (including joking that the slide title should probably be trademarked!) and Kelli agreeing that it’s problematic when the functional groups within an organization don’t share data effectively.

She also explains that Cendana is small in terms of headcount but is able to manage billions in assets thanks to having the right technology and properly structured data. That requires putting time and effort into assessing what information is available to you and how you’ll gather, manage, and utilize it.

Kelli also shares and describes an interesting slide with sample Cendana data sets and emphasizes the importance of proprietary data. She then explains Cendana’s data ingestion process, use cases, and data flow.

She goes on to talk about her challenges in finding a technology partner that understands both Salesforce (as the foundation of a data management system) and her firm’s specific need—and how Altvia meets those critical criteria. She mentions products like AIM and Altvia Answers, with both being critical to her firm’s operations and the latter being a “game-changer.”  

An Informative Demo

The session continues with a software demo, starting with actual data in the Altvia Answers product. Kelli explains how Cendana uses Answers to its advantage, noting that users can generate the data requested by any stakeholder in seconds.

Jeff then switches to a demo database to show more Altvia capabilities.

Great Questions and Insightful Answers

We’re grateful that an engaged audience asked excellent questions throughout the session. Their participation allowed the panelists to share essential insights on the Altvia suite of products, what integration capabilities it has, and how firms can leverage data and technology effectively.

We encourage you to check out this information-rich webinar. And if you have questions about Altvia products and services, contact us today to request an informative demo.