Today’s alternative investment sponsors and broker-dealers face historic demand, shrinking margins, and a competitive job market. And talent, when you find it, is at a premium. This combination forces firms to do more with less. Small to mid-size firms are particularly impacted by the current environment. With smaller teams, expanding workloads, and the challenges and opportunities that come with scaling for growth, an increasing number of firms are adopting technology platforms to help streamline document processing, reduce errors, and put investor dollars to work faster.
Specifically, sponsors are actively promoting, and in some cases requiring, the use of electronic subdocument (subdoc) processing platforms. Technology not only allows firms to scale with minimal staffing additions, but it also elevates the advisor and investor experience because it simplifies the transaction.
Today’s technology aims to reduce human error and the number of NIGOs (Not in Good Order). NIGOs are a drain on sponsor, firm, and advisor time and are a point of irritation for investors. By creating electronic subdocs, all required fields must be completed before the system will permit the subdoc to be submitted for review and signature. While the process cannot eliminate data entry errors, it does greatly reduce the number of NIGOs which helps put investor dollars to work faster.
Innovative technology, by design, is built around people to bridge the workflow between those inside and outside sponsor firms. With the right technology, firms of all sizes can scale with minimal expansion of their teams.
By trading tedious paperwork for a user-friendly technology platform, firms and advisors can focus on enhancing their services, expanding their product offerings, and spending more time talking with clients. A win-win-win.
Build it and they will come
One good thing that came from the COVID-19 pandemic is the widespread adoption of technology to maintain relationships and conduct business. Firms and individuals that were resistant to technology prior to the pandemic have now adopted it and have an increasing comfort level with it. There will always be firms and individuals that do not trust technology or do not want to learn yet another platform. However, that will become less of the norm as time goes by and they continue to see that the benefits outweigh the momentary inconvenience of onboarding a new platform.
It may seem overwhelming
The thought of adding one more item to your “to do list” is daunting, especially when that item is going to require time and effort to set up, so it functions effectively for your firm. I would argue that the time spent identifying, learning, and implementing a new platform will be very well spent. Identifying a technology firm with strong client support that does the heavy lifting for you certainly makes the process less cumbersome. I would encourage you to talk to your peers, reach out to technology providers for demos, and have discussions about your firm’s needs and how they can support them. In the end, creating a structure that makes it easier for firms and advisors to do business with you will be time well spent.
Heidi Wheatley is chief operating officer at Keystone National Properties.