Market changes, coupled with the increasing pace of change in the private equity industry, have highlighted the need for faster, more reliable data for real-time forecasting and portfolio monitoring, accounting fund administration and performance.

Lionpoint provides technology and operations consulting to private equity firms across a broad range of investment strategies including buyout, growth, venture capital, debt, funds of funds and secondaries.

Our private equity consulting firm has partnered with top private equity funds globally, improving their deal sourcing and pipeline management, fundraising and investor onboarding, investment analytics, fund administration, investor reporting, portfolio management, and financial planning and analysis. Lionpoint private equity consultants also deliver reporting and value enhancement methodologies in respect of portfolio companies, from investment through to exit.

Lionpoint and Anaplan's Forecasting, Modeling and Carry Guide for Private Equity

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“Private equity CFOs and their technology leaders’ partner with Lionpoint because of our expertise in private equity operations and our track record of implementing best-in-class technology solutions.  This combination enables us to deliver superior value and drive efficiencies to address the growth and complexity challenges that our clients face.”

Jonathan Broch, Director, Lionpoint

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Technology for private equity companies

Across a growing number of solutions available to the private markets industry, we have strong partnerships with the leading technology platforms, and private equity solutions.

Our private equity advisory team can help your firm on its overall technology approach and provide guidance through the selection and implementation of best-in-class technology solutions.

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Implementing a Fit-for-Purpose Private Equity CRM System to Fuel Growth

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What is Private Equity?

Private equity is considered a type of alternative investment that involves raising capital directly from investors and private funds. This is in sharp contrast to sourcing money through the stock market, which requires a company to become publicly listed via an initial public offering (IPO).

Because private companies aren’t limited to the stock market, they have a much more comprehensive range of financing options, including getting retail investors directly. They often source capital through private equity funds, which focus on investing in private corporations.

There are many types of private equity funds, who work with specific companies or asset classes. A distressed funding firm, for example, typically invests in companies that are in financial trouble. The fund managers will often implement management changes to ensure that the distressed company can recover.

The most popular type of equity funding, however, is leveraged buyout. This is where a private equity firm buys out a corporation and improves on it, intending to sell it via an IPO for a handsome profit later on.

The primary way that private equity firms make money is through management fees. Typically, they also get a percentage of the profits when an asset they manage gets sold. This can easily reach millions for funds with a large number of AUMs (assets under management).

The biggest advantage of private equity is that the company doesn’t need to go through the rigorous requirements of being a publicly-listed corporation just to raise money. This also gives entrepreneurs and business owners greater flexibility in setting the terms of the investment.

Private equity is also more favorable than conventional financing options like a bank loan or debt because they often figure high-interest rates that might be detrimental to startups.

For investors, however, private equity investments are typically longer and rarely as easily traded as a public stock. That’s because private companies need more time recovering from subpar earnings, realizing profits, or achieving an initial public offering (IPO).

Another disadvantage for investors is that private equity isn’t as liquid as a public stock. If investors want to sell private equity, they need to search for a buyer actively. There’s no mechanism like a stock market that makes this process nearly automatic for the seller.

The lack of a governing body like a stock market also means private equity shares are largely unaffected by market forces. Businesses and investors are free to develop valuations as they see fit. This can be a good or bad thing, but it generally increases an investor’s risk substantially. Furthermore, any disputes are settled between the investors and business owners instead of a governance framework.

The Advantages of PE Consulting

Consulting for private equity firms is a vital strategy in ensuring their continued performance and profit. The lifeblood of these firms is their ability to pick the right companies to add to their portfolio. That requires getting the right data at the right time.

Private equity consulting can help these funds spot opportunities to improve their productivity in these crucial areas. For instance, having the right modeling and data platforms can help a firm’s forecasting capabilities, giving them better decision-making insights.

A “single source of truth” for a private equity firm’s deals and contracts is also essential. The instant access to insight enables managers to make better decisions, coordinate more efficiently, and separate profitable deals from losing ones.

The right technologies can also aid investor onboarding, information sharing, and sourcing deals. This, in turn, can dramatically improve the efficiency and profitability of a fund. Moreover, it can also help make your fund more transparent – a crucial concern that investors and lawmakers have over private equity firms.

However, while the technology is there, it is not easy to sort through the many options to find the one that fits your needs. With this in mind, a private equity advisor can be indispensable. They can guide you through the best platforms, highlighting benefits and features as well as providers that work best for your unique situation.

But more than just technology, a private equity strategic advisory can help funds detect bottlenecks and inefficiencies in their operations. As a result, you can expect a better bottom line moving forward.