Across the past 20 years, the Capital Markets have harnessed digital transformations to drive efficiencies in traditional investment management such as retail banking, trading, and sales. Finally, the alternative asset industry is catching up, realizing the efficiencies it can gain by going digital.
Digital transformation is the redesign of core processes and interactions for improved efficiency and value by combining a deep understanding of user needs with agile design practices and digital technologies (cloud, data/analytics, fintech partnerships, intelligent automations, Telepresence and mobile, etc.).
For those unfamiliar with alternative investments, they comprise assets other than traditional stocks, bonds or cash – such as investments in financial assets and pooled funds including venture capital, private equity, hedge funds, REIT and commodities. Specifically, private equity includes numerous investment strategies, including private debt, private credit, and corporate buyout. These strategies are supported by core business function such as fundraising, investment management, and monitoring, investment planning and capital redistribution. Numerous operational processes underlie these functions – from reporting and analytics to identify deal opportunities, to accounting and legal to support deal completion – all of which can be further enhanced through digital transformation.
For example, digital distribution of alternative investments is a trend that has opened investment opportunities to new audiences.