Analytics and Transparency: Are you Keeping Up?
May 9, 2017
May 9, 2017
A Pervasive Theme at the PartnerConnect East Conference
In late March, hundreds of industry participants convened in Boston for the annual PartnerConnect East conference. In addition to networking opportunities, the event featured a number of keynote speakers and several breakout sessions – covering private equity, venture capital and real estate – moderated by reporters and editors of Buyouts magazine. While the dialogue of the event spanned the gamut of the private markets, there was one theme in particular that stood out: Transparency & Analytics.
This topic has increased in importance for LPs in terms of how they monitor their fund managers as well as how they manage their own portfolios. There has been an observable movement across the industry toward achieving transparency through the institutionalization of technology and analytical systems. Today, we have more advanced technology, tools and resources available than ever before. But, the extent and degree of sophistication with which LPs and GPs have embraced this trend can vary widely.
While some GPs have made real investments in technology, back office and investor relations, others have been slower to adapt. For their part, LPs are demanding more data, information and transparency, and at the same time are building out their own infrastructure to manage and process data so the information can be used in more advanced ways.
Analytics & Transparency Key Note
Hamilton Lane Vice Chairman Erik Hirsch addressed this topic in a keynote Q&A session at the event, contending that the private markets industry is at an inflection point. Erik explained Hamilton Lane’s view that one of the biggest success factors over the next 5-10 years for both GPs and LPs will be how much time, energy and capital those firms are dedicating to their internal resources. He pointed out that Hamilton Lane recognized early on that our asset class was far behind others in this area – and, so, for the sake of our clients and the industry, decided to take action.
As a firm, we have dedicated ourselves over the last few years to creating, investing in and partnering with best-in-class technology systems to help the industry improve in this area. These systems include iLevel, DealCloud, Black Mountain Systems, and most recently, Cobalt.
Data, analytics and transparency will surely continue to be an important discussion point at events like this one and across the industry more broadly. We hope that through our example and that of other like-minded organizations in our asset class, we will begin to see a more widespread embrace of technology as a way to dramatically improve transparency, data reliability and in-depth analytics in the private markets.