With the proliferation of Alternative Investment and Private Equity firms, dealmakers need to find an edge in order to stay organized, move faster and keep ahead of the competition. Here are three ways technology can improve the efficiency of your deal process – from start to finish.
- Origination – Sourcing deals is the lifeblood of every private equity firm – but it’s tough. Whether seeking a new platform provider or add-on acquisition, it’s imperative that you find that right needle in the haystack. Nothing can replace personal relationships with business owners and investment banks, but an online deal sourcing and marketing platform is a great way to supplement your sourcing and origination efforts. The beauty in leveraging these platforms is that, simply by creating and maintaining a profile, you get qualified deals coming to your doorstep from across the street and across the globe. You can ensure you’re showing up on appropriate buyer’s lists and being prominently showcased for deals that your firm would want to explore. Online sourcing is the perfect pairing for your traditional origination efforts – with little additional effort required.
- Due diligence – Quickly and thoroughly parsing through all of a target company’s data and information is key to closing any deal or deciding to no longer pursue a transaction. When that deal is sourced in a proprietary fashion, it’s even more critical to gather that company’s key data in order to move swiftly. Having the ability to launch a VDR on-demand and give the management at a target company an easy and secure space to upload data makes for a seamless and elegant experience that’ll allow your deal team to assess the prospective transaction. When exiting an investment, having a detailed familiarity and comfort level with a single platform will shave days off the deal process and ensure consistency across deals.
- Portfolio company communication – Once a deal is done it’s important to monitor the health of your investment and stay organized for an eventual sale. Periodic reports that come in as email attachments and are filed away don’t give you the ability to actively collaborate with portfolio company management and retain all key company documents in a secure fashion. Retaining and updating key company documentation in an organized structure keeps you acquisition-ready and your data securely shareable at a moment’s notice. Introducing a portfolio communication protocol at your firm is an easy way to save a lot of time and future headaches.