Private Equity Data Strategy

Data strategy and access is key for private equity clients.

Many private equity firms are rich in data but poor in data strategy, a gap that can be costly when it comes to making investment decisions. How do you begin to close that gap, and what benefits do you stand to gain from doing so?

Telling the Story

A private equity data strategy can unlock a wealth of information that can help firms make better, faster decisions about their investments. Unlocking that information starts with breaking data out of siloes and into a single source of truth.

Most people in this business understand that the information they have is siloed,” said Jeff Wilson, Founder and CEO of Saxony Partners. “They realize that if they were able to bring that information together in certain ways, then it would tell a story that they know is there.

“So, when I think about applying Saxony’s ‘Do More With Your Data’ motto to private equity, I believe it’s about unlocking the power of the information that you already have by bringing it together to tell a story.”

Firms may already have a vague understanding of that story and its components. However, few of them have the time, energy, and bandwidth required to assemble those components, piece them together into a narrative, and output reports that visualize that narrative. This is where a private equity data strategy – complete with reporting, analytics, and automation tools – can provide an advantage.

Creating a Private Equity Data Strategy

A private equity data strategy begins with a thorough assessment – both of your business needs and goals, as well as the types and sources of data with which you interact. Then, the focus moves to capturing and integrating that data into a single source of truth. From that enterprise-wide database, the data can be reported out and analyzed, which is where you can gain a lot of insight that can help you meet those aforementioned business needs and goals.

“What we’ve been able to do for clients in this space is to help them make sense of their data,” said Michael Martin, Vice President of the Financial Services practice at Saxony Partners. “We can do that at enterprise-scale, or we can go in a more nuanced direction that focuses on a specific deal and a specific valuation decision.”

Either approach is designed to find quantifiable metrics to positively influence decision-making. The result can be anything from improved efficiency, to boosting existing investment value, to uncovering new investment opportunities.

Saxony Partners’ “industry first, technology second” approach is tailored for private equity clients who want practical, right-sized technology solutions to help them achieve specific business goals. We employ experts from the financial services industry, people who have first-hand knowledge of how your business operates, to develop a strategy. And then we hand that strategy over to our technology and data experts to begin implementation. 

“We pride ourselves on being able to both create and execute your strategy – and do so in a collaborative way,” Martin said. “We bring the right team to the table in order to ensure that, when we lay out a technology strategy, we can staff to it and ensure success. Not many firms can do both of those things – and even fewer firms can do them well.”