Limited partners and fund-of-funds managers are struggling with the unstructured and delayed data they receive from general partners, an investment survey has found.
The research, released by data analytics firm Accelex and software platform Carta, shows that 92 per cent of respondents say the lack of data quality has negatively impacted their investment decisions or reporting.
Overall, the report notes that the rapid growth of private markets has caused mountains of documentation, with market participants facing inconsistent information delivery and little standardisation.
Read more: Private markets growth presents data issues for fund administrators
The conclusions derive from a survey carried out in August with 100 senior investment professionals at fund-of-funds across Europe and the US.
“The rapid growth of private markets is a double-edged sword,” says Michael Aldridge, president and chief revenue officer at Accelex. “Greater access to private assets drives diversification, but the volume of unstructured, inconsistent, and delayed data now poses a front-office problem—directly impacting performance and fiduciary obligations.”
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The survey points out that nearly a third (31 per cent) of respondents are facing headwinds with the delivery of information through PDFs, emails and scanned documents, with 40 per cent flagging inaccuracies as a concern.
These manual inefficiencies lead to teams spending a third of their time on data handling instead of higher-value work, the report notes.
“The operational burden is real and speed matters,” said Jeff Perry, chief revenue officer at Carta. “Great investment decisions start with great data—and that’s exactly what fund-of-funds are missing because of the way GP data is delivered today. Once teams free themselves from data chaos, they can seize opportunities faster and focus on what truly matters: performance.”
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In response to the growing data challenge private markets are facing, 80 per cent of respondents have started using AI for data access and structuring, the report added.
