Key Challenges
A large mid-western pension plan engaged InvestTech to lead a vendor evaluation and selection for a private equity system. At the time of the engagement, the pension plan was using an outsource service to track their $1.75B private equity portfolio, which consisted of twenty-two funds represented by fifteen relationships. The client’s current and forecasted level of investment activity, along with the need to monitor the portfolio of funds and the underlying activity, such as deal flow, cash flows, geographical and sector exposure, was essential. The desired solution needed to address greater transparency of the holdings, seamless integration with other assets managed in the plan and quicker, more reliable reporting and performance measurement capabilities.
InvestTech Solution
During the requirements phase InvestTech consultants met with key pension personnel to establish all functional and technical requirements in the areas of deal pipeline/flow management, portfolio management, contact management, general ledger, partnership administration, distributions, return analysis, reporting and performance. They jointly established the evaluation criteria and related weightings. After pre-qualifying a short list of vendor systems, InvestTech distributed a Request for Information (RFI) to the selected vendors. The evaluation of alternative solutions involved vendor interviews to clarify responses where partial product functionality existed or where required workaround solutions were part of the vendor’s response. The evaluation focused on functional and technical capabilities of each vendor, vendor stability, ease of implementation and a determination of the most cost-effective solution for addressing the most critical requirements. InvestTech led on-site product demos of the leading candidate solutions with a pre-established demo script and completed vendor referenced checks to determine the finalists.
Results
Based on quantitative vendor scores, client demo scores, and senior management’s decision criteria InvestTech presented final recommendations to the management team and assisted with the vendor contract negotiations. Based on the selected vendor and InvestTech’s knowledge of the client’s application environment and workflows, an implementation project plan was developed detailing interfaces, reports, resource requirements and timelines.
Why InvestTech?
InvestTech employed their established Systems Evaluation Methodology for this project (see figure). The methodology leverages 15 years of market experience and provides an evaluation framework resulting in a “best matched” vendor selection. InvestTech saved the client time at critical steps in the selection process, and worked diligently to ensure that all their requirements were considered.
