Here are some key quotes from my latest podcast with Richard Change, Co-Founder and Managing Director of PFA Solutions, discussing the adoption of technology solutions for more efficient firm management:

“As a whole, I think our particular focus is centered around GP carry management and performance reporting management.”

“We realized not one system [at our old firm] had a distinct list of assets that we owned over the years because each system was thoroughly focused on managing data in that particular system. And so that was a big eureka moment for me.”

“I think we really had to figure out what the industry was looking for. And one of the things that we saw was a gap, and where there still is a gap, in data standards.”

“Don’t be afraid to ask questions and ask as many as you can. Have different people reach out and get advice from mentors or, you know, people who have actually done it before.”

“[The calculation of Carry] can bring a great deal of complexity to you later on with the vesting aspects of that definitely getting complicated over time, particularly when we see firms managing this information on Microsoft Excel.”

“We see clients now coming to us, because [Carry Management] is also a retention tool, as well. It allows firms to be able to accurately report on what someone at the firm has been allocated, as well as what’s that potential value.”

“At one or two billion assets under management . . . that’s when we think the tipping point is for firms to reach out and figure out how can they manage this. And then also when they look to onboard new people, as well.”

“[We also offer] a performance management product that sits side by side with Carry. And it’s really giving internally for the firm to be able to see top down how the firm is performing. So we really started this whole process working with general ledgers in the industry.”

“I think one of the investor demands that we hear about and see . . . is really being able to provide that insight and transparency to fund performance. And so most investors that we’ve spoken with, that’s what they’re looking for.”

“I really think it’s our operational background, understanding finance, accounting, and then a technology expertise. And so having that mix is rare in the industry. And so it definitely sets us apart, where we can sit down with the CFO or the fund accounting team, talking about fund structures.”

“We definitely see this [interest] from the newer funds, or even the VCs, [looking for] a one stop shop, essentially, private equity in a box. And so from a systems standpoint, we’re not there yet. I don’t think anyone’s going to really get there.”

“We realized we can’t be everything to everyone. And I think that’s the challenge as well, too. Because if you do that, how do you scale product, because you’ve really built it for that one client doing all these things. And the nuances and variances are different from firm to firm, for sure.”

“The biggest change for us that we’ve seen is the commoditization of IT, and IT resources. So really, what that means for us is that the Cloud has had a huge impact with how services can be delivered and implemented.”

“I think we’ll see a greater adoption of technology. And we’ll see uses of technologies, not just on the acquisition side, but on the management side as well, too.”

“That’s what we educate our clients on – that it’s great to pull in information to Excel all day long, but don’t let it be your single data source.”