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Global Investment Manager trusts Linedata Investment Analytics for Portfolio Valuation

Co-sourcing solution delivers instant scalability, optimized bandwidth, significant
cost savings, and client satisfaction across multiple engagements.


Client Challenges

  • Rising staffing costs and limited bandwidth made it difficult to scale the business
  • Valuation of major holdings in Level 3 assets required hard-to-find and retain specialist skills
  • Process inefficiencies and a lack of standardization diverted analyst time and management focus from strategic activities
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Our Solution

  • Experienced Linedata team took over day-to-day valuation activities for over $5B in AUM
  • The initial team of three analysts has doubled in size while assuming greater responsibilities covering more than 100 deals
  • Linedata manages valuation team recruitment and onboarding in line with client requirements

Client Benefits

  • Valuation no longer consumes internal bandwidth or distracts leadership from core business
  • Linedata analysts act as trusted extension of client’s team across multiple functions, providing instant scalability
  • Our solution has delivered about $1M in cost savings in two years while delivering transformational process enhancements

Linedata’s client is a global investment management firm with over $30B AUM covering credit, equities, and real assets in public and private markets. The company has billions of dollars of exposure to Level 3 (illiquid) assets across multiple asset classes, industries, and geographies.

As the firm expanded its global footprint, highly competitive job markets in New York and London created staffing challenges and limited the ability to scale up and down in line with the broader business environment. At the same time, the lack of process standardization in the firm’s approach to valuation led to inefficiencies and unacceptable levels of last-minute work, while consuming leadership focus.

To keep its expansion objectives on track, the firm required a cost-effective, flexible solution to address its staffing, bandwidth, and scalability challenges. It also needed to improve its operational processes and model management, and address concerns around deal transitioning and data security.

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Delivering a bespoke valuation solution

Valuation of complex private and public market investments is a long-standing specialization within Linedata’s Investment Data Analytics offering, which also includes portfolio monitoring, model development and maintenance, and investment idea validation. Linedata’s market reputation and expertise made it a natural choice to take on valuation support activities for our client.

Given the portfolio’s complexity, our client needed a team of CFAs or equivalent with significant valuation experience who were well-versed in valuation methodologies and highly proficient at financial modelling. To put in place the right solution, Linedata sent a senior manager with over 15 years of domain experience to the client’s London branch for a week of intense discussions and project ideation. This enabled Linedata’s initial team of three valuation experts to onboard immediately and deliver at a very high level.

In building the team, Linedata handled all staffing and training requirements while giving the client’s valuation group final right of refusal for shortlisted candidates. The client evaluated each candidate using its in-house screening process, including an interview and case study round. In parallel, Linedata worked with the client to ensure optimal information security, confidentiality, transparency, and trust. This included configuring the client’s IT systems so Linedata analysts could work in a virtual environment with the client retaining full visibility and ownership of all data and outputs.

After demonstrating success by delivering at a high level for six months, Linedata doubled its team’s size to six members. This enabled our client to offload half of its GP portfolio (in terms of positions and market value), enabling it to focus on increasingly complex deals and new opportunities. Linedata acts as an extension of the client’s organization, with deep trust and daily interaction between in-house analysts and the Linedata “co-sourced” team. Weekly calls provide a forum for discussing deal-specific issues and pending workflows. Linedata analysts also take part in valuation committee meetings and other senior-level discussions involving sensitive investment data and strategic initiatives.

In addition to mitigating cost and key-person risk, Linedata has built trust to the point that staffing additions no longer require client screening, saving significant overhead for our client’s senior professionals. “The performance of the Linedata team has provided a great level of confidence to us,” says the Head of the firm’s Valuations Group. “The increase in deal coverage by the Linedata team is a reflection of the good work and depth of the team.”

From short-term proposition to long-term partnership

When Linedata’s engagement began in 2019, no one could have foreseen how COVID-19 would impact staff availability or lead to a sudden rush of distressed assets. In addition to keeping client operations running smoothly through multiple lockdowns, our partnership has provided our client with the bandwidth, flexibility, and specialist expertise to scale and grasp unexpected market opportunities.

Our team has stepped up to provide ad hoc support with audit, compliance, market value reconciliation, and data integrity authentication projects. Proactive process enhancements have unlocked efficiency gains of around 40%. Our client is exploring other areas to expand its outsourcing / co-sourcing relationship with Linedata, including middle office solutions and operational support for its asset management, portfolio management, and compliance functions.

“Our overall experience with Linedata’s valuation services has been excellent,” the head of the Valuations Group concludes. “We look forward to continuing and expanding this relationship.”

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