Broadridge says that its ‘digital at source’ Private Markets Hub enables managers to “fully participate in the workflows and processes directly with their fund administrator,” writes
The Private Market Hub is the first deployment of blockchain technology for the private equity market. The firm expects it to help overcome the challenge of transparency within private markets by providing GPs with real-time access to data and a 360-degree view of the fund lifecycle.
The solution not only brings GPs into much closer alignment with their fund administrator(s) by seeing every workflow in real-time; it also enables them to manage, communicate and engage with investors with greater efficiency and data transparency.
In November, Emerald Technology Ventures confirmed its decision to use the Broadridge Private Market Hub to gain visibility and reduce transaction friction on all of its Guernsey-domiciled funds.
Brian Crowley, global head of product and product strategy at Broadridge Asset Management Solutions, said the hub would also provide a “frictionless digital experience” for private equity stakeholders.
PE groups have not always tended to enjoy the same levels of visibility into their fund data as their appointed fund administrators. But as Tony Poulson, vice-president of product strategy in the private equity solutions group at Broadridge, tells Private Funds CFO, by introducing the Private Market Hub, “it is the first time the wall between fund manager and service provider has been completely broken down. It means a firm like Emerald will be able to fully participate in the workflows and processes directly with their fund administrator; in [Emerald Technology Ventures’] case, Northern Trust.”
Northern Trust has successfully migrated four Emerald Technology Ventures funds to the hub.
“ The industry is long overdue digital disruption ”
Tony Poulson, Broadridge
For COOs and CFOs, the blockchain ecosystem within which the hub operates should make it possible to automate many more workflow processes, front to back, and provide more effective oversight when tracking capital calls, distributions and other cashflow-related activities.
This is the first time a fund manager, like Emerald, and its various service providers and stakeholders will be able to collaborate with a single set of data and associated workflows.
“Many of the processes within the private equity space are highly manual,” says Poulson. “We provide what we term ‘digital at source.’
Rather than scraping PDFs and so on, we capture information at the get-go, such as the limited partnership agreement.
“We can now digitize that and drop it on to the blockchain so that the entire fund structure is placed on to the platform without any manual intervention.
“Thereafter every event during the fund lifecycle, including opt-outs or other unique provisions contained in the LPA, will be taken into consideration within downstream processes and workflow. For a CFO or COO, that is where the real efficiencies start to come into play.”
For a fund manager producing investor information, for example – such as a distribution through its fund administrator – doing so constitutes a typically friction-filled and time-consuming set of processes.
“We are smoothing these frictions, one by one, with Private Market Hub,” says Poulson. “The industry is long overdue digital disruption and we believe blockchain is a perfect vehicle for that.”