Preface

It’s not news that private equity (PE) is a huge driver behind some of the world’s largest technology deals. Previous research has shown that private equity led more than 57% of public-to-private technology deals in the first half of 2023 – almost double their share compared with 2020, 2021 and 2022.

However, despite such heavy investment in the technology industry, private equity firms are still clinging to a reputation of sluggish adoption of transformative technologies. Many PE firms still heavily rely on Excel spreadsheets, word processors and manual processes in the front-back and middle-office space, meaning they struggle to quickly gather or analyse the data they need for reporting or investing. This has resulted in a distinct ‘digital gap’ across the private equity market, with a stark difference between what investors expect and what GPs are currently delivering.

So when it comes to technology, why do private equity firms back it, but won’t buy it?

To understand the relationship between private equity and digital adoption, we’ve partnered with The Drawdown to survey key players in the industry. We received responses from over 30 C-suite professionals, with more than two-thirds of those surveyed managing more than $1bn AUM.

The survey yielded promising results, showing that reducing this digital gap is a key priority for PE firms. There are signs that the private equity world is catching up with other sectors and stepping up its game to keep pace, increasingly adopting tech solutions to improve onboarding, data analysis, compliance and reporting.

We believe that the adoption of transformative technologies is only set to grow as firms shake off their legacy cobwebs – opening a great deal of potential for value creation in the industry.

Justin Partington Group Head of Fund and Asset Managers

Rich Drew Group Product Development Director