How to Get the Most out of Your Data – Get Involved!

Authored by: Peter Rosenstein, Chief Product Officer, Digital Solutions
Published on: July 28, 2025

Originally published in Global Custodian

Private equity firms must ditch the ‘buy versus build’ mindset and actively engage across selection, ownership, and maintenance to unlock real value from their data.

The primary technology question for private equity firms is often framed as “Should we buy, or should we build?” The reality is that not only is this the wrong question, but the premise is also false – buy versus build was never a binary choice to begin with.

Years ago, firms built custom reporting tools to get data out of their general ledger and show the calculations they needed, like IRR and MOIC. Some would start off with a SQL database and build up. Others would bring in specialized developers to build out custom reports in rendering platforms, but these were rigid and static, so firms also needed dedicated staff to make changes and update them. More recently, the trend is building large repositories like data lakes and then layering a business intelligence tool on top to slice and dice the data.

Every “buy” has a component of “build.” The right question to ask is “How can we get more out of our data?” There are three keys to doing this well – all of which require active and ongoing involvement.

Selection

The first thing firms must focus on is identifying what they need, then finding the solution that will meet that need. Unfortunately, few get this fundamental piece right. Teams are hit up with emails and marketing campaigns for platforms all the time, and too often simply react to what they see, viewing product demos and then determining if they need the product, rather than really determining what they are trying to solve for.

Another issue is that rather than taking a comprehensive approach, the job is often assigned to the office of the CFO or whatever department raises their hand. This approach, particularly when the key stakeholders are not directly involved, is a recipe for disaster.

Ideally, firms will set up a cross-departmental committee tasked with evaluating potential solutions. While it is true that targeted solutions are often the best option, and not everything will be a “do it all” solution, firms can be much more successful in their system selection if they have a committee view to take all needs and perspectives into account before a choice is made. Many firms are essentially small businesses with limited staff and many employees wearing “multiple hats.” A small committee with multiple perspectives can still lead to the best outcomes.

Based on what we see, less than 10% of firms take this approach, which is why so many find the process so painful.

Ownership

The firm’s job is not over once a solution is chosen. While the committee may disband, there needs to be a long-term, permanent “owner” of the platform implementation. Don’t be tricked into thinking that assigning an owner is optional. If your vendor claims its product is truly turnkey, and you don’t have to do anything, run away. Believing that is a great way to waste a lot of time and money. There is still data validation and integration to be done, and firms still need to ensure that APIs or other processes to move or transform data run smoothly. No matter how plug-and-play a specific platform may seem, some level of involvement is unavoidable.

This is where we see another common mistake: assigning ownership solely to an IT person. Why is this a mistake? Because IT’s job is usually to ensure integrations are in place and working, to support users, and to maintain software/hardware/cybersecurity, not to address the primary issue, “How do we get more out of our data?”

So, whose responsibility should it be? The owner could be a single person, or it could be a committee. Some firms have their fund administrator own the process on their behalf. Whatever your solution is, everyone assigned needs to understand what they’re accountable for and what the objective is.

Maintenance

Even more important than onboarding and getting the data in place is ensuring your technology does what you want it to as your needs evolve—a job that is more complex than ever. Private equity used to live in the world of quarterly reporting. Now we’re in a world that is, if not real time, very close to that. On the GP side, firms want to see how a new deal impacts the overall portfolio or performance of investments as soon as valuations are finalized. On the LP side, investors have raised demands on data access and are asking higher caliber questions that need fast answers.

Following implementation, many vendors celebrate with you and see you on your way. You may have an assigned rep, but they are probably not picking up the phone every day and checking to see how things are going. A strong vendor will have some client success managers doing regular check-ins to make sure you are happy, but firms must have people in-house (or dedicated outsource resources) who are monitoring use, thinking about enhancements, anticipating future needs, and critically, communicating all this back to the vendor on a regular basis.

In addition, providing feedback to the vendor you’re working with is essential to make sure that the product continues to meet new and changing needs. If there are different ways that teams want to slice and dice the information, or new ways it needs to be routed or manipulated, the firm must proactively communicate that to the provider because they’re not just going to know intuitively. A strong vendor is one that wants to work with their clients to continually improve the product and that starts with good communication.

Professional vendors will share best practices they see from other customers, but that is still just an educated guess at what you want. Clear, direct, and regular communication from someone whose job it is to oversee the technology usage is the best way to optimize the solution.

The bottom line is that firms need tools that are going to be configurable and customizable to do what they actually need rather than what someone else decided that they need to do. And the best way to do that is to take an active role in the process, from selection through implementation and ongoing maintenance, with clear ownership. Buy is not the solution, build is not the solution. Getting involved is the solution, and the only way to get the most out of your data.