Data: Private equity and VC firms’ super power

There’s little doubt that technology can help private equity (PE) and venture capital (VC) firms drive efficiencies, enable more detailed reporting, and ultimately raise more capital. However, selecting the right digital tools is just one part of the puzzle; the key to success is actually the data that can be gathered as part of a digitised process.

Good quality data is central to a firm’s ability to unlock the potential of their private markets proposition. This is where the use of technology comes into play, thanks to its ability to unlock previously inaccessible insights into client engagement, portfolio analysis and process efficiencies.

However, data is only as good as the way you use it. This blog sets out some of the ways that PE and VCs can maximise the value of the data they can extract from a private markets platform.

Prioritising investors based on behavioural insight

It’s highly likely that a PE or VC firm will be talking to a lot of investors at any one time. This can make prioritising the right conversations difficult to manage, especially if the firm doesn’t have a large team dedicated to investor relations.

This is where a private markets platform can generate detailed investor insights to inform which conversations should be the top priority in your calendar. Knowing who has logged into the platform, which fund they’ve interacted with, and what time of day they tend to be most active can be invaluable for ensuring that your investor outreach is as personalised as possible.

For example, by analysing investor activity on Delio Core, you might notice that an investor is actively researching funds in the impact space, but is yet to make a commitment. Armed with this information, you could construct a personalised outreach strategy that highlights funds with specific sustainable development goals (SDGs); this is far more likely to spark a conversation than a generic email.

Your investors’ historical data is also easily accessible. By analysing how they have deployed capital in the past, you may be able to categorise which investors are most likely to commit to particular deals or funds in the future, which could be invaluable when building a book of prospects.

Personalise your marketing strategy

Being able to create investment pitches that speak to investors‘ unique passions is vitally important. Delio Core enables you to understand how investors are interacting with your platform, which in turn allows you to learn what type of information, positioning and page layout is most effective.

Delio’s platform also allows you to tailor each promotion to include imagery, video resources, online content and written information. This means that you can share information in a variety of ways and grab the attention of investors, regardless of whether they prefer high level summaries over detail, or words over imagery.

This information can also be promoted using Delio Core’s on-platform communications tools. Simple to use email templates enable you to construct professional quality marketing communications that link directly to your platform, driving traffic and stimulating investor engagement. This is combined with personalised distribution lists, meaning the tailored content can go out to similar audiences of investors, saving time but still ensuring it’s relevant.

Strengthening governance around distribution

Targeting the right investors at the right time can be almost impossible to achieve without tangible, data-driven insight. Digital tools like Delio Core are designed to generate this granular level of information across each stage of the investment lifecycle, as well as classify investors to ensure that they only have access to appropriate opportunities in the first place.

For example, when investors are onboarded to a Delio-powered platform it will collect data around their regulatory classification and preferences before they have access to any deal flow. Any fund that is added to the platform must be classified as being suitable for particular types of investors, meaning that the risk of clients seeing opportunities that they are not qualified to invest in is completely mitigated. This is true whether they are trying to access information directly through the platform or because they have been sent a platform-generated email (in which case they would be automatically removed from the recipient list).

In conclusion…

By digitising their private markets proposition, PE and VC firms have the opportunity to significantly improve their data strategy and gain invaluable insight into how investors are interacting with their products. This data-led approach can then be used to drive highly personalised commercial conversations that should ultimately raise more capital.

One thing is clear, as more firms look to harness the power of data, those that are ‘behind the digital curve’ risk losing out.

Discover how Delio Core private markets technology can help you by booking a demo today.