Category: Private Equity Technology

The industry has seen a significant uptick in investor demand for better-performing deals and asset classes, and a solid investment management strategy is a core component in meeting that demand. As part of that strategy, Private Equity and Venture Capital are evolving not only to better understand the immense value data and analytics can bring to the firm, but also meet the needs of stakeholders demanding greater transparency in reporting ​​and more insight into valuation processes. 

With private equity firms experiencing a rising pressure to utilize both data generated from operations as well as the industry, PE/VCs need to not only understand the value of their data generated through internal operations (and how this might affect the information provided to investors and key stakeholders) but also how to use a combination of company-generated and industry-level data throughout the entire investment lifecycle—from unlocking new opportunities within the market to making better-informed decisions.

So how can your firm’s investment strategy benefit from data-driven insights, specifically? Read on to find out. 

Better Analysis Starts with Better Access to Quality Data

Without access to quality data, firms put themselves at risk of making ill-informed decisions.  However, to fully leverage the power of data and analytics, many firms will need to upgrade their data infrastructure to incorporate AI and machine learning – critical components to drive innovation. 

Thankfully, due to the rise in demand, PE/VC-specific software solutions are available that can help firms shift from manual spreadsheet analyses and forecasts and projections (which are highly prone to human error) to a more streamlined portfolio monitoring process.

For example, before streamlining their data and reporting, RCP Advisors had data and information scattered across spreadsheets and team members. They were running inefficient processes to try to make sense of it all. After implementing Altvia’s software solution, the firm was able to automate and enhance the reporting capabilities that they had been running manually, significantly improving their ability to present data in a usable format.

With these newly enhanced reporting capabilities, RCP is armed with more informative, more insightful, and more accurate data, empowering them to make better-informed decisions throughout the deal stage.

The Role of Data in Analyzing, Forecasting and Evaluating Investments

According to a report from The Wall Street Journal, 77 percent of PE executives conducted due diligence data analytics, while 68 percent utilized it during negotiations. From sourcing through to monitoring, data plays a critical role in each stage of the investment management funnel, and the ability to gather large groups of data together in a digestible format will help provide a more efficient and profitable business.

Perform Stronger Due Diligence 

In the research and due diligence phase of a deal, firms can leverage data and analytics both internally and from the industry to look beyond the information provided at face value to better inform their decision-making. The pre-deal stage includes leveraging third-party online sales data to identify category trends, pricing, and validating assumptions about a brand before moving forward. 

Unlock New Growth Opportunities

When it comes to value creation plans, data and analytics provided through AI can help speed up the process while unveiling new growth opportunities. With broader data sources, firms can better understand the market, uncover consumer behavior and trends, and even develop data-driven insights to attract new customers.

Track Progress and Pivot in Real-Time

Along with unlocking new opportunities, sophisticated portfolio monitoring software (like Altvia’s!) can provide deep insights to help PE/VCs track progress against their investment management strategy and use new information to identify underlying issues, empowering them to pivot and course-correct in real-time.

Enhance Value for Portfolio Members

Finally, PE/VCs can leverage data and analytics to formulate a solid story to demonstrate the value created for portfolio members. For example, by leveraging both market and internal data, firms can more efficiently analyze businesses throughout the entire sale process and demonstrate robust data-driven strategies for portfolio members.

Level Up Your Investment Management Strategy

Data and analytics are invaluable tools for any firm’s investment management strategy and provide powerful insights surrounding portfolio monitoring and pre-acquisition research. But they also play a major role throughout every stage of the deal funnel—from due diligence to monitoring.

It’s no secret – to remain relevant in today’s market, businesses need to think about, and take action toward, how they’re making an impact on the planet. After all, sustainability is the new aspiration for companies, and the key to achieving it is developing enhanced ways to measure ESG initiatives, performance, and overall impact.

However, measuring ESG performance is easier said than done. So how can PE/VCs ensure they’re on the right track? It starts by determining how to measure the relative value of any given ESG metric and understanding the pitfalls to avoid misleading investors along the way. 

Understanding ESG Performance

At its core, ESG performance is a measurement that shows how a company is performing against set criteria of ESG (environmental, social, and governance) values. This measurement is used by investors to fuel decision-making and compare brands against competitors. ESG performance is also a leading factor consumers and employees use to determine if a brand is aligned with their values before deciding to do business with or work for them. 

When it comes to comparing ESG ratings, three main approaches are used by investors: 

1. Comparing ratings to peers managing comparable portfolios
2. Leveraging a standard industry benchmark index
3. The investor’s history and internal data

However, each approach comes with caveats. The appropriateness of each depends on an investor’s particular situation, including the risk profile of the portfolio, the composition of stakeholders, and any fiduciary obligations. 

Comparing ESG performance is not an apples-to-apples game, though. When comparing specific ESG performance indicators, investors are often misled, given how much ratings can vary by industry, company, and value point.

Measures that Mislead Investors

Because one of the biggest challenges in measuring ESG performance has been the lack of consistency surrounding industry benchmarks and performance measurement metrics, investors face challenges when evaluating performance. This becomes increasingly tricky when comparing the performance of one company to another, including competitors. 

Whatsmore, most ESG data available is often self-reported by companies, which means there are significant gaps in data availability, not to mention somewhat biased information. 

Measurement also often fails to provide insight into messy underlying processes. For example, data shows that adding women to executive teams will produce better outcomes. However, that data point doesn’t take specific outcomes into account, such as decision-making that reflects diverse perspectives. This is why investors must look beyond the numbers to learn how, why, and under what circumstances the decisions came about. 

Performance Pitfalls to Avoid

It’s recommended that firms follow a “zoom in, zoom out” approach. This means “zooming in” to focus on better integrating ESG factors and their values within the portfolio while also being sensitive to issues of concentration, tracking errors, and risk. By “zooming in,” firms can create risk frameworks that pinpoint ESG threats and failures. By “zooming out,” they can better understand issues and underlying processes while gaining insight into bigger-picture strategies and opportunities. Without a broad and narrow look at investments, PE/VCs risk missing opportunities to improve performance. 

Finally, it’s imperative to maintain a single source of truth for ESG benchmarks and metrics. A trusted, reliable data source that arms management teams with confidence in their numbers and transparent reports for investors is critical to effectively measure ESG performance.  

Track and Measure Your ESG Performance with Altvia

To track and measure ESG performance with confidence, your firm needs to rely on the right tools to effectively transform your ESG commitments and data into transparent reports for your stakeholders. 

To turn your goals into an operational ESG strategy and effectively measure your progress along the way, a tool like Altvia can help. From evaluating risks, to monitoring competitor insight and internal performance, Altvia’s software can arm your firm with transparent, quantified metrics on the impact of your ESG initiatives. 

To see how Altvia can supercharge your firm’s ESG initiatives and performance tracking, contact a member of our team to start a conversation.

If you’ve made a smart investment in purpose-built fund management software for your firm, you want to be sure that it continues to deliver the maximum benefit to your team members.

The best fund management software solutions, like ours at Altvia, don’t require a great deal of upkeep. But it can be helpful to take a fresh look at your system periodically to ensure you’re getting all you can out of it.

With that in mind, below are 10 actions you can take.

1. Create new dashboards and reports. It’s a good idea to review the data you’re getting out of your system now and then to see if there’s other information that would be helpful, new ways to summarize your data, etc.
2. Add metric tracking. For more insight into the performance of your funds, consider tracking metrics associated with your investments.
3. Develop print-ready tear sheets. Simple, print-ready reports are an easy way to streamline the compilation of reports for weekly meetings or any other reports you manually compile regularly.
4. Add user licenses. If you have multiple users sharing the same login information, you should consider getting more user licenses. Having everyone access the system with their own credentials enables you to track who changed which records, and sometimes more importantly, who deleted a record.
5. Perform database cleanup activities. Deleting obsolete reports, cleaning up list views, and removing duplicates is critical to maintaining the value of your data. It can also support higher user adoption, as people quickly lose trust in a “dirty” data source.
6. Update screens. Along the same lines as data cleanup, removing fields that aren’t being used and eliminating near-duplicate fields contributes to the usability of your system.
7. Automate additional processes. Look for tasks that are currently being performed manually outside of the system—like in spreadsheets—and consider having your system do them for you.
8. Conduct training. Any investment you make in training new users or expanding the system knowledge of existing users benefits both your firm and the stakeholders you interact with.
9. Add validation rules. Consider adding validation rules to your system. They ensure that data added to the system is complete and correct. If it’s not, the user is prompted to make corrections.
10. Create or expand workflows. Workflows help make tasks as efficient and effective as possible. For example, you can set up workflows to automatically update records, send out emails, assign tasks when deals move to the next stage or when they get rejected, and more.

Create the Fund Management Software Solution You’ve Envisioned

Every firm is unique. For that reason, while Altvia solutions are designed with best practices in mind, you can, nevertheless, optimize your fund management software the way that best meets your needs. And, if your needs change, you can tweak our fund management software solutions so that they evolve with your firm.

Considering implementing fund management software or replacing your existing system? See our industry-leading solutions in action. Request a fund management software demo today!

What really matters when you’re talking about investor relations? Fundraising and firm performance. To set fundraising teams up for success, they need the proper fundraising software.

Businesses of all kinds use CRMs to manage everything from contacts to relationships to meetings. Salesforce is an excellent example of a CRM that is used by many private equity firms. As the #1 CRM solution in the world, Salesforce is a powerful platform, but you need to use it right for it to be effective. 

Often, private equity firms struggle to customize their CRM to fit their very specific needs. For example, Crosslink is an investment firm whose investments range from early-stage private companies to well-established public corporations. Their team adopted the Salesforce CRM but confusion arose almost immediately on how to structure the system for their needs. 

Crosslink’s investor base is made up of large organizations that often have smaller subsidiaries that need to be tracked and managed separately. Data on these smaller divisions, however, needs to be rolled up to the umbrella organization so that Crosslink can understand the entire organization’s portfolio and which fundraising activities have taken place throughout the organization. Crosslink found it difficult to properly track these activities in a standard Salesforce setup.

This is where implementing a fundraising software built for the industry, powered by Salesforce makes an enormous impact. Altvia is made exclusively for private equity firms and knows the structure that works best for the industry. The software is structured based on our knowledge of what has been successful at other firms and enables the quick setup of a system that supports fundraising.

Watch the video below to get an overview of how Altvia can accelerate fundraising by prioritizing your most engaged LPs, and targeting new LPs who fit the ideal profile.

Targeting the Right Investors

To thrive in private equity fundraising, firms need to identify the right investors, connect with them, and use data to differentiate themselves.

If firms aren’t identifying the right investors, they won’t win. The wrong investors make it impossible to quickly close and generate favorable returns. The right fundraising software should focus on targeting LPs and investors who fit a specific profile. 

Altvia helps firms find LPs who fit the bill and prioritize the most engaged investors. Within Alvia, the account page contains a wealth of information that can be automatically enriched by third-party data providers, such as Preqin. With this data, firms can find investors searching for specific investment opportunities, and learn their past activity and future plans. You can also use filters to find fundraising prospects that passed on the previous opportunity but requested that you follow up with them during the next fundraise.

Seeking LPs with the right focus and credentials? Altvia allows you to easily view important KPIs and activities from a customized dashboard. These dashboards are interactive, enabling easy drill down on specific information to reveal more detail. 

Altvia also makes it easy to track relationships associated with an investor account. You’ll be able to identify the contact information for employees as well as other industry connections like former employees and placement agents. You can also view previous interactions with this account for firm-wide transparency and the ability to craft more personalized communication. 

Execute and Optimize Investor Relations Communication

Once you know who the right investors are, it’s time to connect with them. 

With the right tools, your Investor Relations team will be liberated from mundane tasks and able to focus on key relationships. Data from all investor touchpoints can be used to deliver thoughtful and contextual interactions and provide the on-demand transparency LPs crave while reducing the burden of one-off requests.

Every step of the investor relations lifecycle can be streamlined and organized with Altvia so you can simplify investor communications using data and leverage tools to send out fund news or critical documents to the right people at the right time—automatically. For example, email campaigns can be sent with a click, and engagement with messages is monitored so you can understand how prospective investors respond to your messages and improve future communication. 

Differentiate with Data

Investors have options and it pays to stand out. What is your firm’s “edge” and how do you plan to create a better experience for investors that builds trust? 

Your team can easily pull objective data from Altvia to communicate the firm’s track record, ongoing execution of investment thesis, and key points of differentiation. These metrics can be conveyed through activities like investor nurture campaigns, which can include information about your firm’s niche, market learnings, portfolio company performance, and announcements of upcoming events. 

With Altvia, you can see if a specific contact has opened your emails or had a chance to view a critical document. If it looks like they have, you could give them a call and ask if they have any questions. Notes about your call can be stored and shared with the team. 

Direct integration between Altvia and Gmail or Outlook lets you access all of your CRM data directly from your inbox. This streamlines communication and allows account activity to be tracked without having to switch back and forth between systems. 

Adopting the right fundraising software helps to identify the right investors, improves the investor’s experience during the fundraising process, and ensures continued investment and future funding.

If you’re looking for more guidance on fundraising software and ways to improve your use of Salesforce, contact Altvia for a demo.

Let’s face it, managing data across departments in multiple Excel spreadsheets and PDFs can be time-intensive and time-consuming (not to mention outdated). At Altvia, we’re focused on providing our clients with flexible tools to help you manage your operational needs seamlessly across the firm, providing a cohesive view of investment portfolio data in one central system. 

The work required to accurately evaluate potential investment targets and unlock new sources of revenue to drive your firm’s growth can seem next to daunting, not to mention, as Don Stewart, CFO at Spire Capital puts it, “brutal.”

To create scalable revenue across a variety of industries within your portfolio, fund managers need a single, centralized solution to record financials, provide information for monthly financial reviews, and produce quarterly and annual reports, at minimum. 

Spend Less Time Gathering Information Through Automated Portfolio Data Collection 

Data from portfolio companies is often gathered through Excel and PDF reports, aggregated by an analyst, and eventually stored in a document storage program of choice. Many firms still maintain this outdated process. This “if it ain’t broke, don’t fix it” mentality, as Stewart puts it, is not only a lengthy process but also relies heavily on third parties and human resources.

However, as we stated in a previous article, private equity firms that fail to accurately project the potential margin improvement at target companies, even though they gather all the data they feel they need to make an informed decision, often miss key connections in the data.

Through an automated data collection platform like Altvia, fund managers and institutional investors can leverage smart technology and AI to not only collect reliable data that displays the financial performance of companies, but also access insights to inform the drivers of the performance. 

With automated data collection, firms can easily aggregate information across their portfolios in a fraction of the time and can leverage the right analytics to unlock endless possibilities to find growth opportunities and new sources of value and revenue within current portfolio companies. 

Empower Your Firm with Insights and Tools that Maximize Value

Automated data empowers your firm to maximize portfolio performance through custom dashboards and actionable insights on portfolio health. With Altvia’s real-time reporting dashboards and powerful business intelligence and data visualization tools, firms can gain unparalleled insight into portfolio metrics and firmographics, visualize benchmarks and forecasting, and present overviews of your past performance and firm successes to highlight value-creation opportunities.

This data also acts as a strategic tool to fuel your firm’s success, both internally and for current and potential investors. Internally, firms can quickly identify trends through visual reports, charts, and determine if investments are on or off track (and intervene accordingly). 

From an investor standpoint, access to customized dashboards with information on individual investments can help better tailor conversations, and close deals faster. 

Finally, with custom CRM integrations, firms can leverage data from objective feedback loops that expose trends and insight on the investments potential investors are most interested in. And, with Altvia’s ability to share documents and expose analytics and trends within your portfolio, you can arm investors with the analytics they need to make informed decisions. 

Prove Firm Differentiation at a Fund Level

Along with huge time savings, Altvia’s portfolio data dashboard provides firms with market-to-market valuations (cost, fair market value, etc.) at a fund-level for each portfolio company, empowering them with accurate information from their portfolio companies and the chance to bring storytelling to life through that data.  

Set your firm apart from the competition (while making your job easier!) by achieving great returns plus providing an excellent stakeholder experience through access to actionable data. 

Shift from Spreadsheets to Automated Portfolio Data

If you’re still stuck in spreadsheet-land, we have a way to help you out of it so you can keep up with the competition and begin to transform your portfolio data for growth-generating results. 

How, specifically, could your firm benefit? The best way to find out is to talk with us about how your firm operates today and the improvements you’d like to make.

The private capital markets are as competitive as ever. Deal teams nationwide are vying for new business across all industries and looking for ways to get a competitive edge and scale their deal pipeline.

For many, that means expanding or improving their private equity technology stack. According to a survey of 137 venture capital firms, 59% of respondents say that their reason for increasing their technology spend is to improve their ability to find and execute deals.

How are these firms using new capabilities to grow their pipelines?

There are four main ways they are leveraging private equity technology:

1. Providing access to a centralized database
2. Improving deal sourcing
3. Enhancing their networking and communication efforts
4. Conducting better due diligence

Giving Private Equity Deal Teams Fast Access to Good Data

There was a time when firms and deal teams could get by with very little private equity technology, and that included having no centralized database. Those days are long gone.

Today, firms need a hub where everyone can enter and find data quickly and efficiently. This is especially true as organizations increasingly adopt a “dispersed workforce” model. Effective deal flow management is no longer possible using emails, documents, and spreadsheets.

Not only can a purpose-built private equity database like Altvia make it easy to gather data, but it can also help deal teams answer questions like:

• Who is our top-performing deal source, by returns to the fund?
• What stage of the due diligence process are we in?
• What are our conversion rates at each stage of the deal pipeline and where do deals stall?

Answers to these and similar questions can make a significant difference in a deal team’s performance and success rate.

How Deal Teams Are Finding More Opportunities

When it comes to deal flow management and getting more opportunities into the pipeline, the most successful firms are turning to data providers PredictLeads, DataFox, SourceScrub, Crunchbase, and Preqin, to name just a few. Deal teams are integrating information from these providers directly into their CRM system and creating criteria for “signals” or “triggers” that are generated when a new opportunity arises. This workflow automation frees them to focus on other tasks until an opportunity requires their attention.

Many teams are also using LinkedIn to help with deal sourcing. When an opportunity is identified, they use the system to obtain basic background information like location and employee headcount for vetting purposes.

Connecting with Business Owners

In order to reach out effectively to business owners that you’ve identified as prospects, you need two types of technology: a private equity CRM (as noted above) and an email system like Correspond: Market Edition that streamlines and automates the creating and tracking of emails. Information provided by the solution helps you identify people who have opened your email so you can follow up with a phone call. It also enables you to find bad email addresses so you can remove them from your database and keep your data “clean.”

LinkedIn is a popular tool for business networking and finding business owners to reach out to. Once you’ve identified your target contact, tools like ContactOut, and LeadIQ can help you find verified email addresses so that you can add them to your database and include them in your automated outreach initiatives.

Performing Thorough Due Diligence

As the team’s deal pipeline fills and its outreach efforts are producing qualified leads, the next step is to start interacting with those organizations. A virtual data room and engagement platform like ShareSecure makes it much easier for you and your prospects to share all types of files—documents, due diligence questionnaires (DDGs), photos, recorded virtual meetings, etc.

Empower Your Deal Team With the Right Private Equity Technology

The tech stack your deal team implements will have a significant effect on their ability to find leads, nurture relationships, and ultimately close deals. You need to equip them with advanced, private equity technology—especially if they are working remotely—so that they can scale their deal pipeline and meet your growth objectives.

Read our free guide, Winning Deals in a Hyper-Competitive Market. This valuable resource covers how the market-leading private equity firms are using technology and data to differentiate themselves, gain a competitive advantage, and attract new deals.

Data management can seem like a waterfall of information that is impossible to keep up with. There are millions, if not billions, of data points pouring out every day—how can your firm make sense of it all? We’re not going to sugarcoat it—if you aren’t using technology to sort through the data, it is impossible to keep up with. 

Thankfully there has been a revolution in the Private Equity (PE) and Venture Capital (VC) space with data and analytics. The secret sauce to success is technology. 

It’s no longer tenable to manage all of your data in an excel spreadsheet. Savvy VCs are investing in artificial intelligence and data enhancement technologies to streamline analytics for fundraising, deal management, and investor relations. There are plenty of options out there— the tricky part is selecting the right software for your firm.

It’s critical that firms choose a system that supports a holistic data approach while focusing on platforms built for their specific industry. Altvia is a cloud-based CRM built on Salesforce with purpose-built modules specific to PE and VCs. Altvia integrates with any application in the Salesforce ecosystem, allowing firms to build an ideal stack of technology.

The Salesforce AppExchange offers thousands of integrations. To help you choose the right solution, we’ve identified 5 apps that integrate with Altvia that we recommend to simplify data collection and streamline access to information on leads, deals, investors, and fundraises.

Preqin

Preqin is the home of indispensable data, analytics, and insights for alternative assets. With it, firms can access some of the industry’s most comprehensive private market data and tools, or get publications, surveys, and events that provide insider access to the largest global network of alternative asset experts.

Get everything you need to stay up-to-date on market movements with comprehensive data on institutional investors, fund managers, and service providers for each fund and transaction across all major asset classes. Isolate your targets, build connections, collaborate, and understand the past, present, and future of the industry with Preqin.

Pitchbook

PitchBook is the ideal research partner if you’re looking for impartial, premium industry data, news, and analysis for private equity, venture capital, and M&A. As an information resource specifically dedicated to these industries, PitchBook’s core strength is its ability to carefully collect, organize, and analyze difficult-to-find deal data.

By using a Pitchbook Plugin for Salesforce and a CRM, users can view, link, and import customized data on people, companies, investors, funds, service providers, and limited partners. The tool delivers unparalleled intelligence to easily network in the investment space with automated integration of custom intelligence like AUM, investment types, and preferences as well as detailed contact information.

SourceScrub

SourceScrub helps firms get the most out of their CRM investment by automatically syncing millions of private company data points directly within Salesforce. They are tech-driven and human-supervised for optimized intelligence. 

There are millions of bootstrapped companies out there and SourceScrub takes the difficult-to-analyze data and offers a more complete and accurate view so you can quickly map, prioritize, and engage with them. With their data, firms can optimize and automate M&A workflows—set and forget a complete record synchronization schedule with AI-augmented, human-audited company data.

S&P Capital IQ

S&P Capital IQ gives firms transparency into private capital flows at each stage of the lifecycle to help them identify the next opportunity with data. Get a better understanding of performance and trends by viewing and comparing similar fund performance and dive deeper into LP investors and their preferences. 

With S&P Capital IQ and a CRM, firms can identify opportunities, facilitate outreach, and understand customers better with company and decision-maker data.

Data Fox

With Data Fox, firms can find and prioritize target accounts to grow their pipeline. Data Fox uses a team of 100+ human analysts to verify AI-sourced insights on millions of businesses, adding 40,000 new businesses per week. 

Stack your pipeline and grow by improving sales, account-based marketing, and supplier intelligence along with standardized data between the CRM and back-office systems. Make quick and smart business decisions with information that is aligned across departmental databases. Their company data, growth signals, and account scoring help firms to personalize their marketing campaigns and sell more.

Join the VC Technology Revolution

Each day that firms ignore the advantages that modern technology offers they fall further behind. There’s no longer any question that firms that leverage technology for data management have a clear advantage. Now it’s just the question of finding the right technology.

Don’t drown in a sea of data, use it to your competitive advantage. Firms will find success if they focus on capturing the true value of their data and automate as much as possible with a CRM and today’s leading applications.

Recently, Altvia Chief Revenue Officer, Kjael Skaalerud, hosted a virtual event,  “Future Proof Your Private Equity or Venture Capital Firm” focused on issues like the role technology can play in a firm to keep the organization operating at peak performance, the technology maturity curve and how firms can assess where they are on it, and hurdles to technology initiatives. 

The session, which was recorded for those who couldn’t attend, also provides actionable insights on how to move forward with implementing technology.

We’re in a period where many records have been set in private capital markets—from VC dollars invested to the total number of IPOs, etc While that’s great news for the industry, it also means that firms that historically based their success on “ a great team” and being “connected” within the industry are feeling some pressure to up their game.

Implementing advanced technology is a great way to do that. As Hugh MacArthur, global head of PE at Bain & Coobserved, “Speed to insight is everything in private equity.”

The Panelists

Along with Kjael, two industry experts provide their insights on how to future proof your firm.

Jennifer Meyer is a director at Greenspring Associates. She’s an expert in technology companies, particularly SaaS-based services, and leads Greenspring’s technology operations team. 

Richard Grajewski is VP, business development at Huron Capital Partners, where his primary focus is deal origination. 

Frameworks – The Role Technology Can Play in a Firm

Grajewski says what’s key for his firm is knowing what deals are coming to the market before getting the “teaser”. In the current market, if the teaser is your first knowledge of a deal, you’re already behind. 

Huron Capital gets ahead of the curve by establishing and maintaining relationships with what he calls “centers of influence” in the market. Screening deals and educating the market on his firm’s investing criteria are also important to him. 

“Having a powerful CRM is vital to everything Huron Capital does.”

He also notes that the firm works closely with Altvia to understand and adopt best practices for gathering and assessing data and setting goals for their operations. 

Skaalerud points out, many firms suffer from “blank canvas syndrome,” meaning they want to implement technology but don’t know where to start, so Altivia’s guidance can be extremely helpful.

Meyer addresses how technology helps firms meet a need for something they’re all pursuing:  actionable outcomes and delivery mechanisms. She points out that her firm has $15 billion in assets under management and 21 years of data that’s helped them achieve that level of success.

But with all that information, the question becomes: “How do you manage that amount of history and data in a meaningful way that gives everyone high confidence in what’s being outputted and delivered across the firm?”

She notes technology enables the people who rely on it, and who ultimately have to make important decisions. If you view solutions from that perspective, you’ll be better positioned to achieve the outcomes you’re looking for. 

You’ll get better adoption if you’re clear about technology’s role and about the fact that it can give your firm a competitive advantage.

Skaalerud agreed, sharing Altvia’s observation of firms that embrace technology tend to be less siloed, with teams that engage fluidly and productively with each other. 

Skaalerud asks about the importance of high-value work and that repetitive, mundane tasks are minimized as much as possible. Meyer some people see “chaos” in a firm’s operations, but emphasizes the importance of taking a closer look at what’s going on and being able to change perspectives from strategic to tactical and back again easily. This allows you to identify the issues that impede the fast and effective delivery of data across the organization.

One example that Meyer gives is data entry. It’s a critically important task but one where errors can occur if people aren’t focused on their work. That focus can be improved by giving the people doing the work what she calls “more high-value outcomes” and the accompanying boost in job satisfaction and engagement across the organization.

Gajewski points out that one of the best measures of the effectiveness of a system is how well it handles exceptions, and that people who know more about how processes affect a firm are better positioned to react properly to unfamiliar scenarios. His firm uses technology, in part, to isolate the variables that can help them be more effective. 

Skaalerud asks how firms—especially those that have been in business for decades—can go about analyzing data over the long term.

Grajewski responds that Huron Capital Partners has historically been “good” at this, but that with an assist from technology, they’re on the path to being “great” at it. He goes on to explain that his firm has created automated dashboards with Altvia’s help that can assist them in assessing the impact of certain factors on their success—things like intermediary, sector, geography, executives or service providers involved, etc.

The Tech Maturity Curve – Understanding Your Current State & How to Progress

Another conversation involves tech maturity in firms and their well-known resistance to change since there’s a certain amount of lift that’s needed to reach a point where the return on their technology investments is clear. 

Meyer mentions identifying true technology “champions” within the firm is vital to success, as is achieving small wins that begin to build momentum toward full adoption of tech solutions. She emphasizes the importance of automating things like reminders so that team members can focus on other tasks.

The group tips for successful technology implementation, including:

1. You need an overarching strategy
2. It’s important to “eat the elephant one bite at a time.”

Watch “Future Proof Your Private Equity or Venture Capital Firm” in Its Entirety

“Future Proof Your Private Equity or Venture Capital Firm” provides a wealth of information both for firms that have cutting-edge solutions in place and for those considering a technology initiative. 

View the virtual event in its entirety here.

Cracks are forming around Private Equity’s (PE) traditional process of creating value. The method of “buy, gut, flip, and repeat,” is no longer seeing the success it once had. These days it’s more challenging to grow portfolios by simply “buying smart.” Hold periods for investee companies have multiplied, and operating groups have increasingly limited time and resources. A data-driven talent management approach requires active monitoring, reshaping, and upgrading management capabilities from the ground up.

Strategic transformation of talent and leadership across the portfolio is the new, sustainable way of creating value.

Creating More Value Through Talent Management

PE can create long-lasting value through talent management as a core competency at the portfolio level. From an investor’s perspective, a strong team of talent can add as much as 30 percent to a company’s market valuation.

To create value from talent management, PE firms need a new approach to leadership and talent. The talent management process needs to start early and be very active. Acquiring and developing top talent needs to be a priority. Management capabilities don’t transform overnight, and firms that adopt tools to help with monitoring and tracking are sure to pull ahead.

Diversity Pays Off

Not only is it essential to acquire and develop top talent, but having a diverse workforce is also highly beneficial. By assembling employees of varying backgrounds and perspectives they generate a variety of insights, ideas, and superior returns.

PE is notorious for lack of diversity. There are too few women and people of color serving in lead investment roles. A Preqin study found that only 17.9 percent of PE employees worldwide are women. Another study by Deloitte and Stanford University found that the private investment industry has low racial and ethnic diversity. The lack of diversity is even more astounding if you strictly look at leadership positions.

For further proof that having a diverse team is beneficial, one study in Harvard Business Review found that diversity improved financial performance among venture capital professionals. Another study from Boston Consulting Group found that diverse teams were a key driver of innovation and produced 19 percent more revenue. The bottom line is that diverse teams make organizations more robust and increase profit.

Tools of the Talent Trade

PE and Venture Capital firms are now responsible for building their own competitive leadership teams and those of their portfolio companies. It sounds like a big job, and it is, but PE firms that lean on data and technology to help them in their talent transformation will reap the benefits. 

Most firms use LinkedIn as a talent management tool to reach and find future employees. Nearly 630M business professionals gather on LinkedIn and it is the most effective place for B2B marketers to engage with decision-makers, influencers, and leaders.

Some firms subscribe to LinkedIn Sales Navigator to deepen their capabilities. Sales Navigator includes improved search capabilities, visibility into extended networks, and personalized algorithms to help firms reach the right decision-maker. 

These are great tools, but the problem with using LinkedIn or LinkedIn Sales Navigator on their own for talent management is that these systems don’t connect to the firm’s CRM. Ultimately, there is not a great way to gather and track information on both the CRM and LinkedIn at the same time.

That’s all changing with Altvia. Altvia was explicitly built for PE and Venture Capital to help firms seamlessly evolve and manage the complexity that comes with growth. Leadership teams can assemble and track the data needed to manage talent with a direct integration between LinkedIn and Altvia—allowing talent management data to show in the CRM. 

Data isn’t siloed in one system, but shared for better visibility, internal communication, and improved efficiency. From storing candidate resumes to tracking specific attributes such as salary demands, potential start dates, and skills, firms have the advantage of both systems to build a talented and diverse team that will add value. 

Need to fill a bunch of roles? By using technology tools like Altvia, firms can keep track of all of the roles they are hiring for, both internally and externally at portfolio companies. Pipeline tracking keeps it all organized and tracks due diligence of candidates. Hiring becomes more streamlined, efficient, and effective. 

Conclusion: Transform the Talent Management Process with Altvia

Gone are the days when firms could simply leverage their finances, slash costs, and expect to unleash value. It’s become common knowledge that attracting and developing a talented and diverse team will add long-term value. By combining the power of LinkedIn and Altvia, firms have the tools that they need to build powerful teams and ultimately, a highly desirable portfolio.

Are you Interested in seeing how Altvia can help your firm transform the talent management process?

It seems that artificial intelligence (AI) is constantly in the news for one breakthrough or another—not to mention predictions from industry observers on what those breakthroughs mean to a particular industry and how they’ll be used. But how are investors and tech giants like FAMGA (Facebook, Apple, Microsoft, Google, and Amazon) companies and others viewing AI and the innovators responsible for advancing its capabilities?

PitchBook’s report titled Tech Giants Pursue Inorganic Growth with AI provides insights. At a high level, the author notes that M&A activity in AI reflects the immaturity of the technology itself. In other words, we’re definitely not seeing its full potential. But despite deal counts and deal values in recent years that have been flat for VC-backed companies, there are suggestions in recent activity that leading users of AI may be ready to start investing more heavily in the technology.

An Industry Gaining Momentum: Highlights of PitchBook’s AI Observations

From Altvia’s perspective, some of the most interesting and important observations from PitchBook’s report include:

• Tech giants have previously focused on investing in internal R&D initiatives and smaller tuck-in acquisitions and acqui-hires to fill gaps where needed. PitchBook surmises that this approach has been used to appease shareholders and prevent high losses and antitrust scrutiny.

• Evidence of the incumbents putting significant resources into R&D includes the fact that they announce new products and research discoveries regularly.

• Reasons for ramping up artificial intelligence spending include that some tech giants have fallen behind in certain areas that they have neglected. Apple’s AI acquisitions to bring its Siri product back up to par with other voice recognition systems is one example. Intel’s acquisition of Habana Labs to energize its own stalled AI chip design initiatives is another.

• Deals of $1 billion or more have been limited to semiconductors and autonomous vehicles.

• Microsoft’s $16 billion 2021 acquisition of Nuance, a company specializing in conversational AI, might be a sign of things to come. Notable is the fact that Nuance’s technology has demonstrated commercial traction in the healthcare industry, so it is more than a tuck-in-focused deal.

• In another sign that AI-related acquisitions are heating up, human resources automation company Workday has acquired employee sentiment analytics platform Peakon for $700 million.

• FAMGA companies spent $133.5 billion on R&D in 2020; total VC investment in North America in 2020 was $29.3 billion.

• To assess the priorities of M&A leaders, PitchBook examined the acquisitions of 110 companies that stand out for their AI R&D. The results are summarized in an interesting bar graph for the years 2017 through 2021. [Link to the report again here?]
• Horizontal platforms such as core software, natural language technology (NLT), and AI automation platforms along with consumer AI are the leading targets for industry leaders.

• PitchBook analysts believe that “NLT is a faster-growing niche that carries greater commercial and strategic value to big tech companies in the medium term,” in part because both Microsoft and Alphabet have signaled that NLT is important to their future with new acquisitions and internal initiatives.

• Public cloud hosting companies are rolling out verticalized AI offerings for industries like financial services, industrial, IT, and healthcare applications. However, they have made a few acquisitions to enhance related capabilities. Instead, they’re acquiring horizontal platforms and developing their own applications.

• The possible ROI of AI acquisitions is still hard to gauge. This is putting downward pressure on valuations for AI startups and causing AI leaders to be hesitant about paying a premium for even the most promising startups, like Element AI.

• The filling of gaps in the AI architectures of FAMGA companies continues to represent a significant opportunity for startups. 

We agree with PitchBook’s take that stakeholders can expect tech companies to make additional large acquisitions in categories that they have already clearly prioritized. And given the immaturity of the technology being acquired, it doesn’t appear that regulators will focus on antitrust issues.

Stay Ahead of the Curve With the Right Software

It seems the AI industry is “taxiing for takeoff.” Staying on top of industry developments and in touch with stakeholders requires purpose-built software. Contact us today to learn more about the Altvia platform—a solution that is as powerful as it is easy to implement.