Alternative Investments Practice
Transform growth in the private equity markets
C&A Consultants bring innovative ideas and out-of-the-box thinking to evolve and transform core business and technology core Investment Operations functions, processes, platforms and staff resources to achieve sustainable results and build long-term value for organizations.
We are at the forefront of advising organizations throughout the business operations spectrum — core functions, processes, platforms and staff resources. Our clients experience the benefits of our comprehensive cross-enterprise assessments across multiple operating functions.
As your trusted advisor, C&A Consulting aids clients to achieve complex and strategic transformations, often concurrently leveraging technology solutions and 3rd-party tools to support your vision and plans. C&A Consulting is passionate about collaborating with clients.
Our goal is to provide unmatched consulting services and game-changing ideas for the investment management industry, including alternative assets, private equity (PE), multiple asset classes, hedge funds, public equities, fixed income, real estate, private debt, and derivatives.
C&A’s Alternative Investments Practice Services:
• Design new front-office systems, processing of multi-asset strategies, designing efficient middle- and back-office functions.
• Build out a strong holistic operations function that can readily support and adapt to meet dynamic investment strategies (for example, investment books and records, treasury, cash management, trading, etc.)
• Perform strategic operational reviews and business model assessments with independent evaluation of asset management operations.
• Advise private firms and state pension investment funds on complex outsourcing strategies and their related infrastructure needs, investment performance management, data governance and due diligence reviews of acquisitions.
We deliver world-class operational, technology and strategic consulting services for our clients. We work with industry leaders and their executive business and information technology teams to deliver proven outcomes and leading-edge thinking and solutions.
Our approach is grounded in standard process methodologies, proof-of-concept and execution. Our practitioners have extensive experience in leading strategic engagements and tactical execution to deliver real outcomes.
As seasoned practitioners, we have worked in the C-Suite ourselves (as COO and CEO in the private equity, hedge fund and investment management space) and understand what it takes to build — and grow — a successful investment management or private equity business.
Our consultants design and deploy innovative, modern solutions with creative ideas to achieve performance excellence.
C&A Consulting practitioners deliver practical solutions and insight into financial regulatory trends that produce long-term benefits and operating success.
Our assessment and recommendations are geared towards Operations functions supporting:
• Diverse asset classes, including complex and innovative strategies (Public Equities, Public Fixed Income, Multi-Asset, Private Equity, Private Debt, Real Estate, Hedge Funds with complex Alpha and Beta overlay structure).
• Diverse traditional and complex investment instruments and derivatives.
• An enterprise view with a focus on investment and operational risk and liquidity management.
• Demand for greater transparency.
• Sustainable efficiencies.
C&A understands today’s financial services industry challenges and issues affecting the Asset Management marketplace.
For the past several years, the investment management, alternatives and private equity industries (including hedge funds, multi-asset classes) have been reshaped by regulators, shifts in the investor profile and a changing business model.
The investment management industry is facing unprecedented growth and complex regulatory, business and technology challenges, prompted by the following trends:
• New and increased regulation and oversight
• Liberalization of rules and regulation governing the issuance of private securities
• Greater transparency, corporate governance and due diligence requirements
Greater transparency and corporate governance, have moved into the mainstream for PE and hedge fund firms. Strong corporate governance and the technology underpinning a transparent business model, are fundamental to investors.
In 2010, the Dodd-Frank law passed, requiring greater oversight of these firms’ basic handling of client investment funds, primarily transparency disclosures and operational structure of processes subject to greater oversight, including:
• Notification and disclosure of investment holdings (securities ownership, transaction detail).
• Financial audit confirmation services for registered holders of investments, to satisfy reporting requirements.
• Reporting and recordkeeping systems and processes enabling issuers, auditors, bankers/custodians, regulators, processors and management to access the status of investment holdings in private securities.
• Custodial regulation and transfer agency recordkeeping of investment holdings.
With a liberalization of stockholder limits, more firms will remain private in the current economic environment, flush with new investor funds, before going public later in their lifecycles to enhance value for investors. The need for better governance structures by issuers, given greater shareholder responsibility and capital fund raises, will ensure sound operating practices benefitting investors.
The size of the private securities market has grown tremendously over the past 5+ years. Private equity firms, in particular, have benefited, raising hundreds of billions of dollars of committed capital from investors, and are deploying capital in new and different transactions. Several macroeconomic factors – lower interest rates, loosening lending standards and more regulatory requirements for publicly-traded companies – have helped catalyze growth in the private equity markets.
Favorable regulatory conditions, as well as an improved technology market, support a modernized view of private firms and their investors. Companies now often choose to both remain private much longer and raise needed capital to extract greater returns for investors.
• For example, the Securities Exchange Commission (SEC), through its 2012 JOBS Act, aimed at promoting economic stimulus and job creation in the U.S. — allows firms to remain private much longer, with a higher ceiling of up to 2,000 investors versus a previous level of 500 holders, before requiring public registration.
• The regulatory change improves the “liquidity” of these securities, thus calling for greater transparency of transactions. Crowdfunding platforms for the new “open source” market, also prompt a greater need for operational structure and processes, further protecting investors.
• Higher transaction volume and speed-to-market (e.g. payment transactions, investor ownership changes) require oversight and efficient operating processes.
• Investors are being rewarded with higher risk-adjusted returns in the private equity market versus the public markets — fueling rapid growth in the private equity and private securities market.
The financial services industry continues to face heightened regulatory scrutiny and compliance, particularly since the 2010 Dodd-Frank reform and numerous federal, state and regulator-based provisions, thereafter. Corporate financial reporting and disclosure requirements have added new pressures on firms to demonstrate greater transparency and accountability to investors, customers, regulators and key stakeholders, resulting in substantial changes to the way technology is designed and deployed in many firms.
Company leaders are now also being held to a higher public and social responsibility standard than in the past, and consequently expect investments in technology to help drive new business while providing robust and reliable systems and infrastructure, including privacy protection and security. This requires deployment of flexible operating platforms and tools, data governance and well thought-out, documented business processes, paired with automated controls and dashboards supporting a culture of compliance and security. For example, advanced software technology and automated processes can help extract critical insights and perform data reconciliation and reporting across multiple sources, systems and interfaces.
Developing a proactive strategy to manage significant financial exposure and operating risk is fundamental to succeed in today’s private markets.
C&A Consulting believes that building a sound business and operating strategy with the right technology infrastructure will enhance your operating efficiency, productivity and growth.
• The standard implementation of investment due diligence programs requires deep understanding of automated processes and methodology for tracking, record-keeping (creation, retention, distribution) and auditing of investment securities.
• Strengthening the audit process and improving risk management through greater process improvement and efficiency are key priorities for today’s business control executives. Audit confirmation has long been a source of friction for issuers and investors, especially for private securities.
C&A Consulting values our partnership with the investment/asset management, private equity, hedge fund, alternative investments, capital markets, and private placements industry.
• Review and restructure the operating structure of financial services firms and public sector pension fund organization.
• Perform business and technology assessment of core Investment Operations functions, processes, platforms and staff structure.
• Identify priority gaps and recommendations.
• Design organization’s operating model and infrastructure requirements.
• Restructure, ‘revitalize’ and realign business operations.
• Enhance or build the front-, middle- and back-office structure and operations.
• Redesign business process workflows to improve transparency and reporting.
• Design investment processing systems and operations model for multi-asset investment portfolio.
• Optimize technology to drive cost and productivity efficiencies.
• Rebuild an entire technology platform infrastructure.
• Enhance regulatory, governance and compliance management within an operating framework
• Automate processes and systems to strengthen business controls
• Implement large-scale business and digital transformation.
• Build out a dynamic, formal core investment operations function to readily support and adapt to dynamic investment strategies.
• Transition key senior management roles.
• Enhance and maintain a robust operations team.
• Advise navigating financial market and technology disruption.
• Reduce cost of operations, while improving governance models.