The growth of the private fund market is having a major impact on the dynamics of the software and data industry that supports it. For today’s allocators, there is enormous complexity in terms of the number of offerings to choose from and the breadth of strategies and industries being targeted. As the proportion of assets being placed in alternatives rises, the pressure to perform has never been higher.
Allocators, even those reliant upon consultants, are increasingly turning to software and data solutions to help them manage their programs effectively. We have seen a number of new products targeted toward this sector both from existing players expanding their offerings and start-ups seeking a foothold in a fast-growing market.
For me, eVestment has been one of the most interesting companies to track, and today sees the announcement of another data integration partnership to follow on from the recently announced deal with Pitchbook, with Preqin’s industry benchmarks make their way onto eVestment’s Private Markets product.
I feel that eVestment is taking a customer-centric approach to developing its suite of products, employing a willingness to work with widely-used datasets in order to increase existing clients’ satisfaction and better attract new users to its ecosystem. It’s a smart strategy.
Having a trusted source of market data is now an integral part of the portfolio management process for allocators serious about managing their programs effectively. Software solutions which do not facilitate the integration of trusted market data sources will increasingly find themselves at a disadvantage in an environment where this functionality is becoming more common. As I mentioned in an earlier article, users are also discerning when it comes to the quality of these integrations too.
It is encouraging to see software providers providing clients with multiple options when it comes to data integration. I have heard all the arguments about the relative strengths and weaknesses of the various databases and benchmarks, but the reality is that allocators need consistency. It is far easier to sell an allocator on an excellent analytics platform if they can immediately utilize the benchmarks which they are already using to track performance.
eVestment should be applauded for successfully taking a number of standalone products such as TopQ and Public Plan IQ and creating an interconnected suite of tools which is supported by high quality external data sources. The integration of Preqin data into the eVestment Private Markets platform reinforces eVestment’s commitment to giving their allocator clients exactly what they want and need to do their jobs effectively.