April 19, 2018
Technology in PE: An Overview
Keynoting the 2018 Darden Private Equity Conference at the University of Virginia Darden School of Business, Hirsch, a UVA alumnus, explored the development in technology in PE. He describes this as the evolution of the asset class that was once simply “two flavors of ice cream — buyout or venture funds. When clients talked about more risk, that was more venture, if they wanted more conservative, that was leveraged buyouts.” [endnote symbol=’1′ text= ‘UVA Darden’] Hirsch continued, “today, there are lots and lots and lots of different flavors.”[endnote symbol=’1′ text= ‘UVA Darden’] Many LPs utilize their data to understand how these different styles impact their portfolio. An investor’s ability to slice and dice data in a dynamic yet effective way is paramount to success in the competitive private market environment.
How Technology can Help Investors
“The asset class has a number of flaws”,[endnote symbol=’1′ text= ‘UVA Darden’] says Hirsch, “too many private market specialists still rely on Excel spreadsheets and calculators while their public equity competitors invest heavily in cutting-edge technology.” [endnote symbol=’1′ text= ‘UVA Darden’] This is another avenue in which leveraging technology in PE can provide a time effective and streamlined approach. Incorporating technology solutions has become an absolute must in order to stay competitive in the private markets. Technology allows you to take a deeper dive into your data and provides insights that simple data sources cannot provide. That may include monitoring your j-curve, determining key value drivers that impact portfolio performance, or analyzing timely private market data such as cash flows. All of which are dynamic metrics that give an edge over an investor who only uses simplistic data solutions.
Technology in PE: Final Thoughts
Clients consider technology solutions like Cobalt LP to unleash the power of their data. Our platform provides a single analytical interface that helps your team diligence smarter, tactically build portfolios, and analyze investment returns. We help you discover insights that Excel and simple data sources generally cannot provide. When your team is empowered with timely, strong data analysis, you can use this information to drive business outcomes, get actionable analytics quickly and foster relationships.