Helen, Rory and Eric never sleep, take weekends, or go on holiday – and yes, they are robots. They are the ones who complete the day-to-day, sometimes tedious, tasks of fund administration at private equity and real estate fund administrator Maitland Group.
As investors become more sophisticated and demand an increasing amount of information from fund managers in a timely manner, those focused on fund administration have been turning to automation.
For Jacolene Otto, head of private equity and real estate at Maitland, the fact that more traditional long-only managers are demanding faster and more efficient reporting, means that those who don’t automate will fall behind. She says: “That demand to be so fast-paced is definitely driving a lot of automation that, as administrators, we need to look at.”
Automation also cuts down on staff costs and frees up the fund administrator to focus on more important aspects of the job, Otto adds. The days of manually inputting data into an Excel sheet, scanning individual letters and sending separate emails to each investor are long gone of course, but not everything that should be automated actually is, according to some.
Hemal Mehta, the founder of AtomInvest, an alternative investment platform and software provider to private equity and real estate firms, says there are still examples where most tasks are completed using email, MS Office and paper and post, apart from fund accounting. It is part of the reason he set up AtomInvest. For a quick win and a bigger gain in efficiency, firms should focus on automation around process and process governance, Mehta says.
Still, says David Sarfas, head of private capital at Intertrust, the adoption of automation has increased in recent years and the next step in its evolution will be the creation of ecosystems, with fund administration moving away from individual products and services to holistic platforms.
“We are going from closed network type of data solutions to more platform type of environments. We are looking for transaction efficiency, automation in calculations, automation in identification of issues and democratization of that data to make things more and more transparent,” Sarfas explains.
Intertrust currently uses robotic process automation for common processes such as capital calls and distribution notices.
SEI, the tech-driven services provider, has also found RPA is a good way to control manual repetitive tasks. Carmine Remo, managing director and head of alternative operations at SEI Investment Manager Services, says: “We would take those tasks and unify them to a more consistent, controllable platform approach with RPA rather than solving for those items with disparate technology or bodies.
“Those ‘old’ methods still get the job done, but I do believe you get more scale and efficiency if you aggregate them with a consistent solution. It also helps mitigate the risk of manual intervention and disparate processes. As we continue to evolve, this could lead to an ability for us to utilize RPA for more complex tasks or even potentially help with system integration processes.”