LP demands brings Corgentum to US West Coast

Corgentum Consulting has opened a San Francisco office in response to LP’s growing appetite for independent fund operational due diligence reviews.

The expansion “will allow Corgentum to better serve investors on the West Coast, in Europe and in Asia by providing a valuable on-the-ground presence in multiple locations,” said in a statement Jason Scharfman, the group’s managing partner. The office will complement the group’s East Coast headquarters in New Jersey. 

Endowments, investment consultants, family offices and fund of funds have all increased their level of scrutiny of GPs’ back office operations in recent years, according to Corgentum. Earlier in April the group published a survey revealing that of the 74 percent of respondents who said they perform operational due diligence on hedge funds but not private equity funds, 68 percent of that subset said they plan to do so in the coming year.

Regarding specific risks, most investors (34 percent) said valuation was the largest operational risk in private equity. That was followed by 22 percent of respondents citing a firms’ standards on compliance and corporate governance, while 17 percent said traditional back office procedures was their biggest source of concern.