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Private equity fund managers often debate the tradeoffs between in-house and outsourced fund administration services. By outsourcing accounting and private equity reporting to a fund administrator, managers can focus their resources on portfolio management and building client relationships. But outsourcing often means moving data to an administrator – something many managers dread, especially as data management becomes increasingly complex.
Thankfully, though, there is a third way that combines the benefits of in-house and outsourced fund administration: Co-sourcing.
Co-sourcing combines the benefits of in-house and outsourced fund administration
How does co-sourcing work?
With co-sourcing, the fund administrator’s team leverages the GP’s software system – and the data within that system – to execute the GP’s accounting and reporting workflows. Fund managers get to offload their administration while still holding on to their data. And fund administrators get to build deeper relationships with clients without complicating data management workflows.
READ MORE: WHAT IS CO-SOURCING?
Why co-sourcing delivers for fund managers
With everything in your system, you’re in control
Our whitepaper, Co-Sourcing: A Win-Win for Fund Managers, breaks down why both fund administrators and fund managers should consider co-sourcing. One of the key advantages is that, with co-sourcing, you as the fund manager own the technology. Your administrator enters and updates your fund’s financial activities directly on your fund accounting system.
This means that you maintain real-time access to your data, streamlining a number of key processes, including:
- Cash flow and performance data remains under your control and at your fingertips, so you can easily share it with key stakeholders when needed.
- You can provide up-to-date investment performance information to your deal team or fund performance metrics to your IR team or LPs.
- When market turbulence prompts urgent queries from your investors, rather than having to request data from your administrator, you can quickly drill into the real data in real time or grant LP access.
Additionally, because the data stays in-house, your technology team can pipe data to your internal CRM, data warehouse, and other systems, bringing a true 360-degree view to help support more informed strategic decisions.
Discover why more fund managers are adopting co-sourcing
Our latest whitepaper dives deep on co-sourcing, breaking down what co-sourcing is and why the market is finally ready for it, examining how co-sourcing compares to other fund administration models, and explaining the key role technology plays in the co-sourcing process. Download now and see how co-sourcing can improve your business.
