(and that LPs can use to vet...)
Data Accessibility & Data Ownership
Most firm data is locked up in siloed, static Excel spreadsheets. It takes a few minutes for any lookup question like “how much do we own?, what was the post of the A round?” These questions can’t be answered on the go etc… This seems like a small issue but can break the flow of any partnership meeting. Multiply the few minutes of time & resource drain to multiple questions a week, every week and it becomes a real issue.
It’s 2020… GPs should be able to look up ownership, purchase / pricing history of any round, co-investors, etc… on a mobile app in real time. GPs should have a holistic view of portfolio companies, not just financials but, recent board decks, company updates etc...
VCs need a single source of truth for this data that they own.
Relying on 3rd party software / admins come with important drawbacks:
- Reliant on 3rd party time tables, workflows, formats
- Super intensive on-boarding & sync processes
- 3rd party software built for one size fits all…
- Fail with edge cases
- Fail for specific reporting needs
- Can’t customize for specific firm processes
- Don’t have control of features or future functionality
With today’s technologies, building a single source of truth in house is no longer difficult. Databases like Airtable or Google Sheets all have non-technical interfaces for anyone on the team to update. Front-end frameworks have made creating custom web apps easier than ever. Firm-owned portfolio / fund management has become table stakes for providing firm efficiency & proving ability to manage a multi-fund firm. LPs can simply ask simple portfolio questions and see if GPs can answer in real time…
Data funnels (without intensive manual labor)
Every GP is strapped for time and completely overwhelmed with email… let’s not even start with trying to find stuff via gmail search... The only way GPs can scale is by introducing software & NLP to help create efficient workflows. Email is chronological so GPs must constantly switch between workflows & situations causing cognitive overload and waste. Instead, email should be automatically labeled & sorted intro workflow funnels for cognitive continuity & efficiency.
Imagine being able to spend 2 hours on your deal flow funnel, then 1 hour on all portfolio updates, then 1 hour on all your incoming network introductions etc… instead of relying on a chronological inbox that requires constantly switching between different contexts & workflows.
Examples of data funnels that can/should be automatically sorted
- Deal funnel
- Portfolio updates, board decks etc…
- -- Inbound
- -- Outbound
- Network management
- -- Introductions (growth)
- -- Relationship management (keep warm)
Unifying a firm's network is crucial. Partner silos limit a firm's ability to fully utilize a firm’s most valuable asset. Firms that under utilize their collective network miss out on the most optimal matches for
- Diligence / Domain Experts
- Customer introductions
- Founders / Deals
Without a unified network firms also waste time on
- Repeat communications
- Context gathering