Rethinking the Secure Data Room: This is Not a Feature War

Years ago, when we developed ShareSecure, our secure data room and LP portal, we were tempted to look at other data rooms or portal solutions on the market and just copy all the features they had. It’s natural for a company like ours, which develops leading-edge solutions for alternative investment firms, to focus on being able to say, “Yes!” whenever a prospective customer asks about whether a secure data room has a particular feature or function. 

Fortunately, we made a conscious effort to reject the notion that great software is the result of simply having more features. Instead, we preferred back then to be more thoughtful about what capabilities a particular software product needs—and we still take that approach today.

We continually ask ourselves (and our customers) how a feature (or lack thereof) solves a problem. The result of being very selective about the functionality we add to our secure data room and other products? Solutions that are easier to use, highly efficient, and more effective at producing the desired results. 

Secure Data Rooms and Internet Refrigerators

Careful consideration of the benefits of secure data room features clearly isn’t the norm in our industry. Several competitive products have a feature list as long as your arm. But what we’ve found is that users tend to ignore many of those capabilities, using only those that make sense for their firm.

Consequently, those organizations are paying for functionality that sits idle. And just as importantly, the unused features make their secure data rooms and other systems bigger, bulkier, and more complex than they need to be.

A comparable scenario in the world of consumer products—home appliances, to be specific—was the LG internet TV refrigerator. Back in the early 2000s, this appliance did what standard refrigerators did “and so much more!” It had a 37-centimeter LCD monitor on which you could “watch internet TV!” That is if you had a data connection behind your fridge. And also if watching TV was so important to you that you needed to keep up with your favorite program for the 30 seconds it took you to fill your water glass or grab a snack.

And for the privilege of watching TV standing up in your kitchen, you paid five times as much as you did for a comparable, non-TV-equipped refrigerator. Don’t get us wrong… We love keeping our food from spoiling and we love TV, but, really? 

Secure Data Rooms: Convenience Over Complexity

People in our industry are smart. They could, if necessary, learn how to use the most complex of products. But why require them to do that?

They have specific objectives when they access a secure data room—finding a particular document, watching a specific multimedia presentation, etc. Enabling them to perform a variety of other tasks not only isn’t helpful, but it can also be confusing and a distraction from what they’re trying to accomplish.

That’s why you can’t watch TV or get a glass of crushed ice in ShareSecure!

LPs are busy professionals. We respect the fact that they have lots of demands on their time and give them a secure data room and portal where they can get in, get what they need, and move on to other obligations quickly and efficiently. Complicated tools? Convoluted navigation? You won’t find them in ShareSecure—and our customers surely aren’t looking for them.

Determining the Right Feature Set for a Secure Data Room

Recently we had a call with a prospect who currently uses a competitor’s product. They asked if ShareSecure prevents end-users from taking screenshots. We answered that it does not. We know from experience that preventing screenshots makes sharing documents more difficult, so it’s counterproductive to add that to our feature set.

We braced for some pushback, but instead, the prospect said:  “OK, we have that feature now and we never use it.” Clearly, they were looking for a secure data room solution provider that understands what functionality is relevant—and what functionality is not relevant—to industry stakeholders.

Secure data rooms, in one form or another, have been around for more than 20 years, so the necessary functionality has been pretty thoroughly explored. Advances in technology may enable the development of valuable new features in the future. But the question firms should be asking themselves now isn’t, “What cool new things can this secure data room we’re evaluating do?” but rather, “Can this secure data room we’re evaluating do everything we need it to do and do it well?”

What’s the best way to answer that question? Do some basic research on the secure data room that you’re interested in, then participate in a live demo of the solution. And, when you do, be sure to focus on the system’s ability to deliver results, not on its “bells and whistles”!

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 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 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 — 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.