Quantium was once again privileged to sponsor SuperReturn CFO/COO in Amsterdam this year, where our Co-Founder Jessie Juan, as well as other industry experts, came together to discuss emerging trends, challenges, and best practices in private markets operations.
Below are some of the key takeaways from Jessie’s panel, “Choosing the right tech stack to transform your investment operations”, and from the overall conference. The topics discussed often focused on recurring themes, such as optimising operational efficiency through technology, navigating the complexities of AI integration, and evaluating software solutions for long-term investment management.
1. Request a software trial before committing
When it comes to evaluating software in the private markets industry, CFOs and COOs need to approach it with a long-term view. Quantium’s Co-Founder, Jessie Juan, emphasised the importance of asking for software trials with your own specific data set before committing to any vendor. “It’s a completely reasonable expectation, especially in a B2B enterprise setting,” says Jessie. “Historically, legacy solutions are less flexible and require long implementation lead time, and for this reason trials were difficult to arrange for prospects.”
“Today, modern software is built with greater flexibility in both input and output configurations – so prospective users should gain first-hand experience trialing the software. In such a dynamic and fast-evolving industry where each firm has its own unique data structures and reporting requirements, it is critical to select a solution that will not only meet your immediate needs, but will also scale well alongside your business.”
Jessie warned against vendors that refuse to offer trials and insist on demonstrations as the sole evaluation method. “Demos often don’t give a comprehensive view of how the software will perform with your own dataset in real-world settings. Being able to run a trial allows firms to test the software’s compatibility with their operational needs and evaluate how well it integrates with existing systems.”
The general consensus was that vendors unwilling to offer trials could be a red flag, signaling that their software might not be ready for real-world use without extensive customisation.
2. Investor group summary: A must-have feature
One of the key functionalities discussed during the panel was the “investor group summary” feature, which is increasingly crucial in the investor servicing space. This information allows fund managers to view a holistic snapshot of an investor’s aggregated position across all their investments, including funds, underlying portfolio companies, and co-investments.
Jessie and other panelists highlighted how this feature helps GPs’ IR and finance teams look at their investments from an LP’s perspective, empowering individualised storytelling conversations across positions and across investment periods. “In addition to single fund performance, LPs often focus on the entire investment relationship with the GP when evaluating the overall performance of each GP relationship,” says Jessie. “Being able to access an aggregated overview via dashboards and mobile apps provides clarity and insight into performance, which is critical when fostering effective communication and strong LP-GP relationships.”
Modern software solutions that do not offer this functionality may fall short in meeting the operational needs of private markets professionals.
3. AI integration: The future of investment management
AI was another dominant theme at SuperReturn CFO/COO 2024, with discussions centering on how it will continue to shape the private markets landscape. CFOs and COOs were encouraged to consider AI not just as an investment opportunity for the deals team, but as a powerful tool for managing investment management workflows internally. It can help streamline processes such as portfolio monitoring, risk management, and investor reporting, significantly enhancing operational efficiency.
“In the next 1-2 years, we’ll see a significant rise in providers weaving AI directly into their software solutions,” says Jessie. “The most successful will be those that position AI as an embedded agent, automating critical tasks like data entry and identifying portfolio related risks in real time, fitting naturally into the GP’s workflow. GPs increasingly prefer platforms with native AI capabilities that boost efficiency without additional integration. Vendors delivering this built-in approach will stand out.”
Thus, vendors that offer AI as an add-on or through external partnerships may struggle to remain competitive in the rapidly evolving landscape.
4. Integrated vs. point solutions: A balanced approach
The debate between integrated end-to-end solutions and point solutions remains a hot topic amongst operational leaders. On the one hand, integrated solutions provide GPs with the advantage of comprehensive fund and portfolio tracking. These systems offer a unified view of operations, allowing firms to manage various aspects of investment management in one place.
The industry also recognises situations where specialised point solutions can address niche requirements more effectively; but for most large GPs, implementing these is not as straightforward as it seems. In the private markets, many firms are still managing their operations on legacy software solutions primarily designed for data storage. These older systems, often built on outdated languages and on-premise infrastructure, lack the flexibility for seamless integration and configurable data outputs. As a result, GPs relying on legacy software often need to create extensive data warehouses and connect additional point solutions, leading to a “stitched-together” tech stack that’s far from cohesive. This approach can be resource-intensive and costly, requiring dedicated data scientists to manage and monitor the system, ensuring workflows run as expected.
In contrast, there is a growing trend of modern firms looking to implement robust, private markets specialised ERP systems, with core functionalities covering key aspects of fund operations, portfolio management and investor reporting. These solutions are designed to scale and adapt alongside evolving business needs. Selecting software that emphasises connectivity, scalability, and usability will allow firms to better integrate and leverage their data, eliminating inefficiencies and improving overall agility.
The SuperReturn CFO/COO 2024 panel provided valuable insights into the future of the private markets industry. As the operational landscape continues to evolve, CFOs and COOs must adopt a strategic approach to technology selection, ensuring scalability and integration.
By asking for trials, prioritising key functionalities, embracing AI, and balancing integrated solutions with point solutions, private market professionals can set themselves up for success in a competitive and rapidly changing environment.