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Posted Jun 21, 2023

How the CFO can improve the investor experience

How the CFO can improve the investor experience blog hero

While a CFO has many critical responsibilities, investor relations is not traditionally under their purview. And even though a CFO may primarily focus on a fund’s financial performance, reporting on that fund’s financial performance does have an immediate impact on the overall investor experience. By championing the internal use of an easy-to-use, modern platform that successfully integrates investment data, data rooms, and the investor portal, a CFO and their team can help ensure that the investor ledger and asset data are up-to-date for LPs and internal stakeholders while also giving investors a professional, user-friendly digital onboarding experience.

Break down internal silos

By helping the IR team provide timely and accurate updates to investors—and cutting down on the time it takes to find and validate information internally—the CFO and their team can directly impact the investor experience without directly interacting with the LPs. This is a huge win for Trent Wallin, CFO of Peak Capital Partners, who told Juniper Square at the IMN COO/CFO Forum that “We want them to know that they can come and get answers quickly from us.”

As Tana Gardner, CFO of Affinius Capital (formerly USAA Real Estate), added, their investors expect that “they can get every piece of data that you have. LPs [want] more and more data to mine on their own.” But when everything related to fund accounting and fund performance is handled in Excel, answering even the most basic questions can become cumbersome and time-consuming. Manually creating quarterly statements, turning them into PDFs, renaming them for each investor, and posting them to the right accounts can be an all-day activity. By pairing investor CRM data with financial position data in a single consolidated portal, CFOs can create an ecosystem where everyone–from finance to IR to the LPs themselves—can look at an investor’s position across multiple funds, know their history, and understand the performance of that client’s investments, ideally with no manual lift.

Deliver more impactful information

“There has to be real depth to the reporting on a qualitative and quantitative basis,” said FD Stonewater Co-Founder Jeff Toporek at the IMN COO/CFO Forum. Some CFOs are turning to a third-party fund administrator to help them do that. By partnering with a modern administrator, CFOs can deliver better financials to LPs by leveraging the expertise of multiple fund accounting experts, reduce their risk by gaining extra layers of review, and save time producing financial statements, all while keeping the investor ledger and investor portal up to date for IR.

As Tana added, “We’re focusing on what we can be really good at, and we don't want to be really good at fund administration. We want to be really good at investing and serving our investors.”

With the right platform and administrator to support them, CFOs can deliver timely and accurate capital activity statements to LPs and post reports directly to investor portals. With automatic performance metric calculation, CFOs can help eliminate conflicting performance calculations, keeping internal teams current and choosing which performance metrics to show to LPs. On-demand partner capital account balances give investors a live look at their investment positions within the investor portal.

Allow LPs to self-serve

Since investors expect immediate and easy access to up-to-date information about their investments, especially as the private markets continue to digitize, CFOs can help their firm build trust and transparency by breaking down and delivering a shared view of the partnership to all stakeholders at any time.

As Lisa Knee, Partner, Eisner Advisory Group, LLC, said, “It’s all [about] transparency, accountability [and] making sure you’re out in front with your investors and with the owners and operators.” The CFO and their team are critical partners in meeting that demand. A forward-thinking CFO can help break down the data and communication silos between the finance and investor relations teams, significantly reducing the operational burden of managing an ever-growing environment and helping deliver an institutional-quality investor experience.