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Just how well do AI chatbots know the PE industry?

It appears there is no question that AI chatbots can’t answer – but just how much do Open AI ChatGPT and Google Bard really know about private equity fund administration? Our industry experts queried the platform and reacted to its answers.

How might the advancement and implementation of AI impact RPA and human capital within the private equity industry?

ChatGPT
As the private equity (PE) industry has matured, fund structures and reporting…
Google Gemini
Artificial intelligence (AI) and robotic process automation (RPA) are two rapidly developing technologies that are…
David Meyerchak
As PE reporting has matured, transparency into underlying investments, data…
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How important is it to fully understand the distribution waterfall at the outset of a fund?

ChatGPT
LPs commit capital based on their understanding of the fund’s terms, including the…
Google Gemini
You may also be surprised by how much of your profits go to the GP…

Michael Hall
In this example of the waterfall, LPs have already received their return of...
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What challenges are General Partners (GPs) currently facing when fundraising in the private equity industry?

ChatGPT
GPs are now competing against a larger pool of peers for a finite amount of…
Google Gemini
Fundraising cycles are getting longer, which means that GPs have to spend more time…
Kyle Derkacz
Regulatory scrutiny remains a constant focus for GPs in fundraising, especially with…
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Why are Limited Partners increasingly interested in funds’ Distribution to Paid-In Capital (DPI) metric?

ChatGPT
A continuously low DPI over an extended period could raise concerns about the…
Google Gemini
DPI is also a more relevant metric for LPs than other metrics, such as internal…
Jeremain Malcolm
However, LPs themselves will be able to best interpret how efficient and profitable a…
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As private equity has matured as an industry, how have fund structures and reporting evolved to keep pace with the increased sophistication of LPs?

ChatGPT
PE funds have also experimented with alternative fund structures…
David Meyerchak
About 20 years ago, a 90-day lag in quarterly reporting was not uncommon - even for…
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Why are Limited Partners increasingly interested in funds’ Distribution to Paid-In Capital (DPI) metric?

ChatGPT
They can provide a level of professionalism and technical expertise that may not be…
Michael Hall
Both GPs and fund administrators are increasingly focused on…
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How do the current tax laws affect carried interest for Private Equity Funds?

ChatGPT
The current tax laws can also change the holding period requirement for an…
Kevin Zeman
As an AI chatbox, ChatGPT is unable to consider a client’s unique circumstances and…
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What role will technology play in private equity accounting in the next three to five years?

ChatGPT
Automation of these processes will help to reduce manual errors and increase…
Kyle Derkacz
This will allow LPs to achieve the interactive, real-time experience they desire in a…
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