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FOR PRIVATE EQUITY OPERATIONS, IS THE SKY THE LIMIT? HOW TECHNOLOGY CAN ENABLE PRIVATE EQUITY FIRMS TO RISE ABOVE THE COMPETITION
FOR PRIVATE EQUITY OPERATIONS, IS THE SKY THE LIMIT?HOW TECHNOLOGY CAN ENABLE PRIVATE EQUITY FIRMS TO RISE ABOVE THE COMPETITION
“I WISH DATA MANAGEMENT AND REPORTING COULD BE A BIT MORE TEDIOUS,”
SAID NO PRIVATE EQUITY INVESTMENT PROFESSIONAL, EVER.
WHAT IF PRIVATE EQUITY OPERATIONS COULD BE BETTER?
(They can.)
FOR PRIVATE EQUITY FIRMS, BETTER OPERATIONS CAN MEAN …
Reduced costs associated with time
and resources to manage data and
comply with reporting requirements
More time to spend analyzing and
acting on data to optimize
investments and strategies
An enhanced client experience
grounded in efficient communication,
data transparency and flexible reporting
HOW CAN TECHNOLOGY PROVIDE THE LARGEST IMPACT WITHIN YOUR BUSINESS?
More standardization*
More informed decision-making
More automation
More agility
More productivity
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
6%
11%
17%
25%
41%
18%
15%
23%
18%
26%
22%
21%
22%
17%
17%
28%
26%
17%
21%
8%
25%
27%
21%
19%
8%
Rank 2Rank 3Rank 4Rank 5Series6
All data is sourced from a 2016 survey of over 300 private equity professionals by FIS and Lantern Insights
*Due to rounding, some totals do not equal 100%.
TO REMAIN COMPETITIVE, INDUSTRY PARTICIPANTS MUST MOVE MORE OF THEIR OPERATIONS TO THE LATEST ONLINE PLATFORMS THAT COMBINE SCALABILITY, FLEXIBILITY AND INTEROPERABILITY.
WHEN THE SKY’S THE LIMIT, LOOK TO THE CLOUD
WHICH TECHNOLOGIES ARE YOU CURRENTLY EXPLORING?
Basic communication tools
Analytics/business intelligence
Mobile
APIs/data integration
Cloud
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
63%
67%
68%
72%
78%
37%
33%
32%
28%
22%
Se-ries5
THE RISE OF THE CLOUD
3%
27%
70%
Despite the industry’s conservativeness and its reluctance to share proprietary investment data and contacts, participants in our private equity survey are surprisingly open to the cloud.
What role do you see for the cloud within your business?
No role
Major role
Minor role
WHAT IS YOUR PRIMARY BUSINESS REASON FOR USING THE CLOUD?
Other
Compliance
Regulation
Cybersecurity
Cost
Data privacy
4%
5%
12%
23%
28%
29%
THE RATIONALE FOR SHIFTING TO THE CLOUD INCLUDES THE INHERENT SCALABILITY AND PROCESSING POWER OF DISTRIBUTED ONLINE PLATFORMS AS WELL AS THE REDUCED MANAGEMENT BURDEN ASSOCIATED WITH EXTERNALLY HOSTED SERVICES.
AUTOMATE TO ELEVATE
TO SPEND LESS TIME ASSEMBLING DATA AND MORE TIME ANALYZING OR ACTING ON IT, YOU NEED TO AUTOMATE PROCESSES TO MAKE THEM LESS LABOR-INTENSIVE. IN PRIVATE EQUITY, AUTOMATION HOLDS PARTICULAR PROMISE IN EASING COMPLIANCE PRESSURES.
IN WHICH AREAS COULD TECHNOLOGY MOST HELP YOUR BUSINESS WITH REGULATORY COMPLIANCE?
Gathering more data
More efficient decision-making
Automated tracking
Automated auditing
Automated reporting
Automated data collection/aggregation
9%
11%
12%
20%
24%
25%
ROLES WILL END UP BEING DIVIDED INTO THOSE THAT CAN BEST BE UNDERTAKEN MANUALLY AND THOSE THAT SHOULD BE AUTOMATED. PRIVATE EQUITY FIRMS SHOULD BE READY TO EMBRACE THIS TECHNOLOGICAL SHIFT.
OUTSOURCE WHAT WEIGHS YOU DOWN
OUTSOURCING, ESPECIALLY WHEN COMBINED WITH NETWORK-ENABLED TECHNOLOGIES, ALLOWS PRIVATE EQUITY FIRMS TO FOCUS ON WHERE THEY ADD VALUE WHILE ALIGNING WITH INTERNAL PRIORITIES TO MANAGE COSTS AND INCREASE EFFICIENCY.
BY 2020, MY BUSINESS IS LIKELY TO OUTSOURCE …
None of them
Middle-office functions
Front-office functions
Back-office functions
4%
40%
44%
54%
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When investors undertake due diligence on a fund manager,
you need to have an established platform to manage your
operations or outsource to a third party. One of those options
has to be in play.Tony Chung
head of product management and strategy, Private Equity, FIS
WILL YOUR OPERATIONS HELP YOU RISE ABOVE THE COMPETITION?
(We hope so.)
BETTER OPERATIONS CAN MEAN MORE ROOM TO INVEST IN THE CLIENT
EXPERIENCE
THE PRIVATE EQUITY INDUSTRY’S EFFORTS TO REINVENT ITS RELATIONSHIP WITH TECHNOLOGY REFLECT A RECOGNITION OF THE CRITICAL IMPORTANCE OF TECHNOLOGY TO WINNING AND RETAINING CUSTOMERS AND TO PENETRATING NEW MARKETS.
WHERE WILL YOU INCREASE INVESTMENT THE MOST BY 2020?
Disruptive technologies/companies
Talent management
Regulatory compliance
Market expansion
Customer experience
5%
9%
19%
33%
34%
“SEE YOU LATER, TECHNOLOGICAL DARK AGES.”THAT’S WHAT WE’RE HEARING LOUD AND CLEAR FROM THE GLOBAL PRIVATE EQUITY SPACE.
LEARN MORE IN OURNEW REPORT
PRIVATE EQUITY AND TECHNOLOGY: THE PROMISE OF TOMORROW
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