The Boston Consulting Group released a whitepaper that outlined the challenges facing the wider hedge fund industry following a consecutive year of underperformance and increased scrutiny surrounding fee structures and operational models. Citing increased concentration toward the largest fund managers, limited partners’ increased sophistication, and more frequent and complex demands from clients, the BCG commentary emphatically endorses a technology-based operational structure in order for hedge funds to maintain relevancy and continue growing. The article states, “Hedge funds will need to reorganize in ways that facilitate the adoption of new technology. This requires more flexible and scalable infrastructure.”
Scalable infrastructure not only refers to the configurability of the technology to address new operational needs, but also accessibility. A high-pressure industry such as hedge funds requires the ability to be productive regardless of the time or location. Investment management software supported by mobile applications enables fund managers and analysts to have 24/7 access to data, activities, and qualitative information on prospects and investors on their phone and tablet. Another operational benefit to mobile applications that complement Cloud-based investment management software is that all updates are instantly shared with all other users, ensuring continuity of knowledge throughout the firm, and further fostering a team-based work environment.
This whitepaper also notes that due to market conditions buyers “will demand more from hedge funds,” including “value-added advisory services” and “deeper integration between hedge funds, their clients and their clients’ clients.” Fundraising in the face of additional requirements necessitates flexibility from your software provider, and the mobile applications that empower fundraising teams to track fundraising progress outside the office – access to prospective investor preferences and prior dialogue maximizes the context of each meeting, and can provide the informed position to convert a prospective investor into a committed investor. Mobile applications also provide built-in mapping functionality for travel, enabling staff to optimize their travel routes and maximize the number of prospects and investors they can personally meet on the road.
The BCG study also affirms that “hedge funds will need tools that provide clients with near-real-time access to key information,” and software vendors specializing in hedge funds can also deliver a valuable mobile experience to both prospects and investors. Investment management software often includes Portals for fundraising and investor relations that allow these users to view key documentation, including performance reports, PPMs, pitchbooks, firm news, management information, and other insightful collateral. Industry-specific vendors are able to optimize these sites’ user experience and navigability for mobile devices, facilitating user access completely on demand. Accommodating stakeholders’ technology capabilities and preferences provides a distinct value proposition from competitors, and enhances a firm’s brand equity.
A fundamental conclusion made by the Boston Consulting Group study is that “a large portion of many hedge funds’ support functions could be better built and operating by third-party suppliers, such as technology vendors,” and mobile applications tied to your investment management software platform are a prime example of the advantages firms receive from adopting an industry-specific software suite. The ability to seamlessly track fundraising opportunities through the fundraising pipeline, continuously share new notes and activities, maximize travel value, and provide a Portal that can be viewed through any device enables firms to effectively distinguish their reputation and service offerings in one of the financial service industry’s most challenging marketplaces.