Revolutionise employee engagement with tech-driven friends and family programmes
As the private equity industry continues to grow at an unprecedented rate, it’s crucial to attract and retain exceptional talent. However, in an increasingly competitive market this can be difficult to achieve. Fostering trust and collaboration in the workplace has become a priority, and many have found that an employee friends and family programme is a powerful tool in achieving this.
In this article, we explore the challenges faced by traditional friends and family programmes and reveal how a tech-driven solution can help you manage and scale these initiatives effectively, giving your firm a competitive edge when it comes to acquiring and retaining talent.
What is a friends and family programme?
An employee friends and family programme is offered by a private equity firm to allow their team to invest in the firm’s funds at discounted rates.
Under this type of programme, employees are given the opportunity to invest their own money in the firm’s funds, alongside other external investors. The investment typically comes with a reduced fee structure, providing the employees with access to investment opportunities that they may not have been able to deploy capital to otherwise.
Building strong connections with employees
Investing alongside the firm through a friends and family programme creates a shared sense of ownership and commitment among employees. It’s this alignment of interests that drives motivation and performance to new heights, benefiting the entire organisation in the process.
By offering a structured investment programme, you can position your firm as a desirable employer in the highly competitive private equity industry. Providing employees with an opportunity to grow their own personal wealth through previously inaccessible opportunities is also a great way to attract and retain top talent.
This approach will also encourage employees to work together towards common objectives, which results in a strengthened sense of teamwork. This collaborative culture should have a positive impact for both professional relationships and the wider work environment.
The challenges associated with traditional programmes
As many firms have found, managing the complexities of a friends and family programme can be time-consuming and resource-intensive. Tracking investments, allocations, and compliance requirements can quickly become a logistical nightmare. As your firm grows and more employees join the programme, this is only likely to become even more complex to solve.
It’s also important to note the increased scrutiny on governance at private equity firms. As regulators around the globe double down on their focus on alternative assets, maintaining your firm’s compliance with industry regulations is crucial. Manual and human-led processes can be prone to errors, so it is vital that your governance framework is designed in a way that it can scale effectively and efficiently as required.
The solution: Tech-driven management of friends and family programmes
As more and more private equity firms realise the benefits of employee friends and family programmes, many are turning to digital solutions to streamline their management. The main benefits of this approach include:
Streamlined processes
A tech-driven solution allows you to automate and streamline repetitive administrative tasks, freeing up your team’s time to focus on strategic initiatives. This will not only increase productivity and reduce administrative burden, but will also create a more efficient experience for staff that wish to invest.
Scalable infrastructure
Once your digital framework and processes are created, you can easily scale your friends and family programme to have more members join. The ability of technology to handle larger volumes of data and transactions ensures you can expand your programme without the need to deploy more resources to manage it.
Enhanced compliance
Digitisation is already helping firms to reduce their compliance risks through process automation and reporting. The implementation of pre-agreed governance frameworks means that your investment process can follow your own specific compliance checks, while ‘always on’ reporting offers a clear and transparent view for audit purposes and maintains the integrity of your programme.
Data-driven insights
Using technology provides you with valuable insights into employee investment trends, enabling you to make data-driven decisions that support future decisions around the types of opportunities you want to offer. For example, which types of investments do your employees find most engaging? Is there a specific time of year that employees are more likely to deploy capital? This data-led approach will ultimately enable you to make better, more informed decisions that benefit your team and your business.
In conclusion…
Embracing a tech-driven solution to manage and scale your employee friends and family programme is becoming increasingly important in the highly competitive private equity space.
By streamlining processes, strengthening compliance, and fostering collaboration, your firm can stay ahead of the curve and secure its position as an industry leader, ultimately attracting and retaining top talent.
Delio Core is designed to manage private markets deals, and is already being used by some of the top firms to manage their friends and family programmes.
Find out how we can help you achieve this by booking a demo.
