We’ve advocated for it before – PEs/VCs that take the time now to empower their team with data and technology have an easier time differentiating from the competition. The first step to level up your strategy is building a solid tech stack.
With so many tools available, how can you be sure you’re choosing the right software and tools for your firm?
Read on as we break down the current landscape of tools available to compile an industry-leading tech stack.
The Core Components of the Modern Tech Stack
The modern PE/VC firm should be stacked with tools that help throughout each stage of the deal process, from consolidating scattered spreadsheets into a centralized platform to ensuring transparency of communications with leads and portfolio members across the entire firm.
There are a few core areas every tech stack should address:
- Traditional data
From company financials to expert opinions and forecasts from leading research providers, traditional data can be leveraged to help inform your firm on new deals. This data is especially important during the research and due diligence phases.
To access all of that public information and centralize it in one place, firms can leverage leading tools like S&P’s Capital IQ, along with publically available websites like Crunchbase. - Alternative Data
Unlike traditional data, alternative data combines information from non-traditional sources like social media, consumer transactions, web traffic; data that is typically not readily available internally through traditional sources.
By leveraging alternative data sources, firms can identify deals earlier on in the sourcing process and single out the best investment opportunities for their firm that much faster. Incorporating alternative data tools like Capterra and G2 can arm PEs/VCs with powerful insights to compile compelling stories and industry information for stakeholders.
To take it a step further, firms can push their alternative data to a centralized hub, like Altvia, to transform that information into visual charts that help tell a stronger story, providing additional value for LPs and portfolio members.
- Research
You already know how important research is in the sourcing stage of the funnel. Ensuring you have the right tools available to help streamline that process is critical to your firm’s success.
While traditional research tools like Forrester can help provide deeper insight into how certain world events impact industries and businesses, software like PredictHQ can help firms predict the impact of real-world events or market shifts. Access to this kind of predictable scenario building will arm your firm with the insight and knowledge needed before making decisions. - Portfolio Management
The more members in your portfolio, the harder they can be to manage. With portfolio management software, PEs/VCs can organize and unify all of that information in one place. From fund and equity information and reports to KPI monitoring and reporting, portfolio management systems, like VestBerry and Altvia, can help aggregate that data down to the fund level.
- Dealflow CRM
A firm builds its success upon a foundation of strong relationships, and the right CRM can help bolster those. However, not all deal flow CRMs are created equal, and, without relationship-driven AI built-in (like Salesforce, for example), they serve as more of a transactional source rather than a virtual assistant to your business.
CRMs, like Altvia, can serve as a centralized source of truth, connecting data from your entire tech stack and helping optimize it across the firm, such as providing AI-driven insights, like helpful alerts on when to follow up to keep conversations flowing.
Take Your Firm from Low-Tech to Tech-Driven
Despite growing investments in high-tech industries, venture capital has a reputation for being a traditionally low-tech industry. However, that’s quickly changing as more and more firms embrace software and data to differentiate. But, with this change also comes the need to juggle new tools and software.
As you begin to shift from spreadsheets to streamlined software, a simplified approach to your tech stack can make the migration a bit easier – and Altvia can help. From portfolio management to AI-powered insights, Altvia can serve as your firm’s single source of truth.
To learn how Altvia’s solutions can fit into your firm, contact a member of our team to start a conversation.
