It’s becoming ever more complex to run a private equity fund back office. How do you take fund administration to the next level, from a cost center to a competitive advantage? Michael Halloran, chairman and chief executive of NES Financial, explains in this short video for PrivCap.
General partners are facing new pressures and disruptions from all sides — from their limited partners, from regulators, from competitors, even from technology — all of which are pointing to the need for a next-generation, holistic fund administration solution. Limited partners — from large institutional limiteds down to individual investors — are demanding more in the way of transparency, reporting, actionable intelligence out of the fund itself. They’re also demanding reduced costs.
Meanwhile, the SEC has made PE a priority examination area — and some of those exams drill deep into the systems and methodologies that undergird the business, including distributions and cybersecurity. This kind of scrutiny can include demands for a bewildering amount of documentation under very tight timetables.
The reality in private equity back office is that you can’t cut costs and rise to the these new levels of compliance and cybersecurity without getting out of the box of traditional fund administration, and moving to an integrated, data-based environment — one that can create operational efficiencies, bullet-proof compliance, and the kind of agility that enables a fund to respond to disruptions without rocking the boat.
But, as Halloran explains, it’s more than about just playing defense. There’s an extra bonus that comes with making this move: With the right combination of technology, domain expertise, and business processes, the best funds will be able to leverage actionable intelligence from the disparate data they collect — and deliver results better, faster and smarter than their competitors.
Watch the video here.