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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
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.
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:
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.
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.
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At Allvue, we’re committed to harnessing technology and expertise to tackle the biggest challenges facing the private capital space. Our Resources hub, offering blog articles, whitepapers, case studies, videos, and more, shares industry best practices and reflects the experience and learnings of top Allvue experts and our partners motivated to see this industry continue to grow and thrive.
Our goal is to provide guidance as well as food for thought for anyone interested in the private equity, venture capital, private debt, and public credit spaces – whether you’re learning the fundamentals or getting ready to raise your fifth fund. Many of our articles contain links to trusted third-party resources to support our takes, and all our content is regularly reviewed and updated to keep current with the fast pace of alternative investment innovation.