A mid-market private equity firm was using DealCloud as its CRM. The system was difficult to customize so tracking deal activity reverted to a spreadsheet. This caused duplicate data entry and led to deals being disconnected from contacts. Weekly deal status meetings required reports to be prepared and key metrics to be manually calculated.
Data quality was also an issue. A critical success factor for private equity is the ability to originate deal opportunities. Unfortunately, multi-office investment banks and advisory firms were captured under multiple names (e.g. “EY”, “Ernst & Young”, “EY Toronto”, “EY Corporate Finance”, etc.), making it difficult to consolidate data for the parent firm.
Given its limitations, the CRM was seldom used. Combined with high recurring subscription fees, an alternative solution was sought.
Approach
It was clear that the CRM needed to be fully integrated with the deal funnel tracker. We selected Airtable as our cloud-based SaaS solution as it combined the power of a relational database with the simplicity of a spreadsheet. Companies, contacts and interactions were linked to deals. There was a high degree of flexibility in customizing views and dashboards in exactly the desired visualization.
Data was systematically cleansed to get a unified view of all deal sources. Structure was added to the data in order to gain more insights into deal origination and investing activities.
Results
Fully Customized and Cost-Effective
- The system was tailor-fit to the exact information the private equity firm wanted to track.
- Cloud-based, concurrently accessible “single version of the truth” compared to a set of individual spreadsheets.
- Recurring subscription fees were reduced by an order of magnitude.
Better Collaboration
- Weekly deal meetings now covered a pre-defined set of real-time views and dashboards without having to manually produce agendas and reports.
- Action items are tracked and updated within the same system, and automated reminders ensure nothing is missed.
Focused Deal Sourcing
- With a unified view of deal sources, advisory firms and investment banks could be measured at a consolidated level.
- Deal sources were “tiered” by historic volume, with greater focus and attention paid to higher volume firms.
- Team performance targets were tracked directly from data in the system.
Conclusion
If you are part of an investment team looking for a better way to track your deal funnel, contact us to discuss how we can help to design a customized deal management system.