The Impact of Private Equity Technology on the Industry

If there’s a type of business that can ignore or refuse to implement new technology as advances are made and still be successful, we don’t know what type of business that is. It’s certainly not private equity firms.

In our fast-paced, highly competitive industry, firms that aren’t using purpose-built, state-of-the-art systems are at a distinct competitive disadvantage.

And firms that remain at the back of the pack don’t last long. 

 Private Equity Technology and Differentiation

 Competition in the private equity space is continually reaching new extremes. This ongoing escalation forces firms to reach new levels of operational excellence, personnel optimization, and data management.

 How do they support this continuous evolution? They stay vigilant, constantly scanning the horizon for the next technology solution to break new ground and enable improved operations. But operating more efficiently and effectively is really just a means to an end. The “end” in this case is creating clear differentiation from competitors.

 Is your firm the only one of its kind in the industry? It may have some of the best people and have an impressive track record of success, but no, it isn’t particularly unique in the services it offers. However, the combination of the skills, experience, and insights of your team with the communication, data management, and other capabilities of the right technology solution—now that’s something that can set your firm apart from the competition.

 And that differentiation can make all the difference in attracting investors and closing deals. Why? ‘

Because the stakeholders you interact with are just as busy as you are. They don’t have the time or resources to assess each one of the countless “middle of the pack” contenders. They identify a few that stand out, do a little research, and decide how to move forward. If you aren’t in that select group of finalists, you’re out of the equation.

How Firms Leverage Their Technology

 How do firms use technology to get ahead? 

For one thing, they use a CRM to manage their contacts. That’s the foundation for getting the right communications in front of the right people at the right times. They also make it easy to share resources securely with stakeholders, which increases transparency and helps create and nurture trusting relationships.

And underpinning all of these advantages is the implementation of efficient workflows. The easier it is to get day-to-day tasks completed, the more time there is for finding innovative ways to engage stakeholders and close more deals.

From “Nice to Have” to Necessity

 Not long ago, switching to a better CRM or an email program with enhanced features was something firms did if they had the time and capital to invest in those upgrades. Today, those tools and others that increase productivity and improve stakeholder relationships clearly have moved into the “Mission Critical” category.

But the good news is that it’s easier than you may think to implement a suite of private equity technology solutions. The first step is learning about what’s available.