Preqin, a provider of data, analytics and insights to the alternative assets community used by more than 100,000 industry operators has announced the acquisition of Colmore, an experienced provider of technology and services to private market investors.
The new alliance between Colmore and Preqin will allow both companies to serve their clients across the entire private market investment lifecycle — from fundraising to due diligence and portfolio monitoring. Preqin also intends to enhance its benchmarks in partnership with Colmore, giving both companies' clients the ability to compare their performance against accurate, timely and transparent benchmarks.
Ben Cook, CEO at Colmore commented: "It's a huge day for Colmore. We're delighted to announce our partnership with Preqin. Clients will get the best of our administration, monitoring and fee validation services, enhanced by Preqin's global private markets data. Clients will be able to see their invested fund information, together with wider industry data, all in one place. We're really excited about the future."
Mark O'Hare, founder and CEO at Preqin, added: "Colmore and Preqin both share the same vision — to make our industry more accessible by providing our clients with data and insights so they can make investment decisions with confidence. Preqin is delighted to have Colmore join the Preqin family. We have big plans for the future as we continue to enhance our solutions, and we cannot wait to get started."
LP Portfolio Management in a Vacuum?
Over the past decade we have experienced a revolution in the LP-focused portfolio monitoring space with the launch of several new platforms targeting an increasingly sophisticated universe of institutional investors. As average allocations rise and complexity increases, the demand for specialized solutions in this area has risen and today’s LPs have many different options available.
Key areas of differentiation between vendors in the software space include:
The process for data ingestion (tech-driven, AI-powered, outsourced to analysts)
The presence of multi-asset class functionality vs. private capital specialization
Analytics and reporting capabilities
However, no matter how powerful the platform, truly effective portfolio management cannot take place in a vacuum. A key activity for LPs managing private capital allocations is to understand the relative performance of existing and potential new investment opportunities compared to the market. While it is possible to achieve this wider perspective using market data and software tools side-by-side, a more integrated approach offers a host of additional user benefits.
While we wait to see how Preqin and Colmore approach the issue of data integration, PE Stack takes a look at how other players in the LP portfolio monitoring and management space have tackled this issue.
The Aggregated Benchmarks Approach
Founded in 1987, Burgiss offers a suite of products designed for institutional investors in private capital and serves more than 1,000 firms in 32 countries. Burgiss leverages its wide userbase to create granular benchmarks based on a large data set of underlying funds which are available via the Private i platform. Although Burgiss’ benchmarks show aggregated rather than transparent fund level data, the dataset is highly accurate, does not suffer from survivorship or reporting bias and is faster to update than other benchmarking products.
CEPRES is a digital solution provider for private capital markets that was founded in 2001 with roots in ‘look-through’ private funds to underlying deal and asset performance and counts thousands of professionals in its private investment network. CEPRES clients have access to the Digital Data Hub, a technology that encompasses transactional data on thousands of funds, deals, and operating data of $32 trillion of invested companies and real assets to provide granular benchmarks. It also leverages data on transactions to power DealEdge - a product created in collaboration with Bain providing intelligence on deal-level returns by vintage year, industry, geography and size.
The Proprietary Data + Transparent Data Approach
Cobalt by Hamilton Lane provides LP clients with a portfolio monitoring platform to analyze new and existing investments alongside a fully integrated proprietary dataset leveraging both Cobalt and Hamilton lane data. Relative to other solutions in the space, Cobalt by Hamilton Lane has a very strong focus on market data as a core part of the value-proposition and is one of the few portfolio management solutions currently providing transparent fund-level data in addition to benchmarks.
The Transparent Market Data via Integration Partnerships Approach
eFront is a leading technology provider to alternative investment professionals with clients worldwide across major alternative asset classes. Pitchbook is a data provider for private and public equity markets. These providers formed a strategic data partnership in February of 2018, allowing eFront clients to access deep fund-level information, giving LPs and GPs the ability to gauge private market performance relative to peer groups for PE and VC strategies. In addition, eFront has integrated performance measurement data and analysis from Pitchbook Benchmarks into a performance measurement tool for fund performance known as eFront Insight.
eVestment, a provider of institutional investment data, analytics and market intelligence, also teamed up with Pitchbook to form a strategic data partnership that offers users access to fund-level performance data via the eVestment Private Markets platform. This collaboration allows users to search and view performance on more than 3,000 firms, benchmark fund performance against peers, and discover true value drivers.
Pitchbook’s parent company Morningstar is also an investor in Allocator, an LP-focused data management and portfolio monitoring platform which operates in a similar space to Colmore. For more information on that deal, please see our research article.
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