Private equity firms in growth mode: Laying a strong foundation and evaluating what’s important
Growing private equity firms are finding new ways of driving value and standing out to investors by building creative and complex investment strategies. Spreadsheets and file sharing are a great starting point, but when deals are sparse and the competition is steep, emerging managers need an infrastructure that will help them go farther, faster.
Reaching the point where you need better systems to stay on top of your portfolio and meet investor demands is an exciting place to be. It is also a large growing pain that will keep resurfacing if operations aren’t put in place to last. Ask yourself- what do we need today and what do we need in 5 years from now?
At Allvue, we’ve worked with early-stage firms, industry titans, and everything in between on operations that help firms accomplish their growth goals.
We created a Private Equity Buyer’s Guide to help emerging managers explore the landscape and explore what is important to their firm. This article offers a snapshot of what you will find in the buyer’s guide. The full buyer’s guide includes a framework for criteria and questions to ask yourself and prospective partners. Scroll to the bottom of the page to download the guide.
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Navigating the Competition in Private Equity
The competition in private equity is steep across deal sourcing, raising capital, tech adoption, and headcount. Having smooth operations is a real differentiator when you are better positioned to spot opportunities and accommodate investor requests.
Private equity firms must be nimble as they navigate external and internal challenges like:
- Market uncertainty driven by macroeconomic shifts such as inflation, rising interest rates, and geopolitical volatility
- Increased reporting requesting transparency on demand and rapid responses to complex data questions
- Implementing AI to optimize operations throughout the fund lifecycle
Technology partners can help absorb the impact of these challenges so you can push forward and scale. But finding the right fit can be daunting.
Understanding the Technology Landscape
There are many ways private equity professionals can perform their back-office operations but finding the right tech partner with best-fit software takes consideration. In the complete guide, we walk through the options:
- Manual workflows: Solutions commonly used to get a firm off the ground, but become hard to manage complexity
- New back-office players: Dynamic software and solutions are less structured
- Point solutions: Tools that specialize in certain parts of the workflow that often require complex integrations with other solutions
- Enterprise platforms: Strong products and financial industry expertise but alternatives are not their only focus
- Private markets platforms: Exclusively focused on end-to-end solutions for the alternatives industry
What to Look for in a Technology Partner
You want a partner that lightens the workload and positions you for the next stage of success. That’s why we recommend evaluating potential vendors across four key dimensions (outlined in full in the buyer’s guide):
- Workflow Requirements– Does the solution address investment structure complexities and match day-to-day core accounting, investor relations, and integration needs?
- Fit to Scale– Can the solutions adapt as the firm grows over time?
- Future proofed technology– Can you integrate new sources of data, new systems, new admins into your workflow when the business or market changes?
- Co-Sourcing– Do you partner with a fund administrator for your back-office operations, or are you looking to onboard one?
These categories can help you differentiate between short-term fixes and long-term partners.
Eliminate the Risks of Just Getting By
As growing PE shops get off the ground, a lot of their tools are fit to get by. We frequently see emerging managers run up against:
- Accounting tasks being too complex to manage and reconcile manually in spreadsheets
- Struggling to produce timely, reliable reports from disconnected systems
- Outdated portals causing poor investor experiences
- Difficulty adopting constantly changing best practices, regulations, or accounting and reporting needs
The details of your operations can have an impact on fundraising, investor trust, and strategic growth. You don’t want your data and reporting integrity to be questioned. The right platform can help eliminate these risks.
What’s Inside the Private Equity Buyer’s Guide
The Private Equity Essentials Buyer’s Guide was developed specifically for emerging and growth-stage private equity managers who are ready to tackle operational pain points and find a partner that prioritizes your growth. In the complete guide, you’ll get:
- A breakdown of the vendor landscape with clear categories and what to watch for
- A structured evaluation framework with weighted criteria
- Questions to ask potential vendors during the selection process
- A case study showcasing how an emerging manager scaled their business by connecting operations
- A preview of Allvue’s Private Equity Essentials offering, purpose built for an evolving growth strategy
Ready to Build Your Operational Foundation?
Choosing a technology partner isn’t just about solving today’s problems. It’s about preparing your firm to move faster, scale smarter, and meet the expectations of investors, partners, and regulators as you grow.
Get the complete buyer’s guide to confidently identify priorities, evaluate vendors, and find the right partner for your private equity strategy.
