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Article, Finance, Finance and Accounting, Other, SMEs

How private equity and VCs can use tech to solve ‘data invisibility’

For private equity firms and venture capitalists, having real-time financial and management information is critical.

Firms need to know how businesses within their portfolios are operating so that they have a clear understanding of business’ performance. They also need to be able to gather performance data quickly and accurately to seize exit opportunities. Delays, or errors, can mean windows are missed.

The challenge is that businesses within an investment portfolio will often be running separate finance functions, on separate accounting platforms and generating data in different formats.

This can cause consistency and formatting hurdles when it comes to consolidating data for the critical ‘top-down’ view – eating up valuable time and money, and leaving room for error, particularly when done as part of a manual process.

Technology can help tackle this problem. Implemented as part of a well-designed solution, it can help firms and investors quickly generate the overview of a portfolio’s finance processes they need, reduce cos- per-process – and ultimately empower better decision making.

Make every business your business

Parseq’s modular Management Accounts offering has been designed with precisely these challenges in mind.

Using our cutting-edge automation and artificial intelligence technology, Management Accounts allows venture capital and private equity firms to bring together financial and non-financial data securely from across portfolio businesses into one single, cloud-based digital reporting dashboard – updated in real-time.

The solution gives a consistent and comparable view of each business, regardless of the accounting platform used, or the source of the data itself.

And it allows firms to generate detailed, customisable management accounts for any business within their portfolio, with built-in benchmarking, performance and forecasting tools.

Together, this enables businesses to gain critical insight – as they need it – without needing to make their own capital investment in new technology.

The service can be applied quickly – removing the barrier of a potentially lengthy set-up processes for an in-house finance and accounting consolidation solution. It is also entirely scaleable – able to grow as portfolio businesses do, and flex as new firms are added or removed.

Overall, the tool can save businesses as much as 20% on the cost of a comparable in-house finance and accounting solution.

Why change now? 

Private equity firms and venture capitalists have always needed access to information quickly in order to move with the times and recognise when a change can really mean a difference.

Shifting to automatic information consolidation through a solution like management accounts brings with it the knowledge that you’ve brought your firm one step further towards sharper and more focused decision making.

Follow this link to find out more about the future of financial intermediaries and how our managements accounts service can make the world of difference to the insight you have over your business’ portfolio, while simultaneously unlocking time and cost efficiencies.

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