From CRM Chaos to Investment Intelligence
This case study showcases how a billion-dollar software investor was able to leverage a custom CRM solution to streamline their processes, significantly reduce costs, and gain unlimited insight into their M&A operations.
Investors tend to shudder at the sound of the word "CRM". But there is tremendous value hiding behind the sometimes tedious day-to-day tasks.
Sound familiar?
Whether you're part of a small PE firm of 10 employees or a multinational conglomerate, these are likely some of the realities you've had to endure. For many investors, the CRM acts as a "repository of companies" that must be painstakingly updated whenever something of value occurs.
It doesn't have to be that way.
A simple model of an investment company
Our model consists of interconnected entities that perform actions with other entities. Your level of insight into your investment operations depends on how many entities/actions you have, and how interconnected and parametrized these items are in your CRM.
Entities
Employees — Corporate Development or M&A individuals/teams
Investment Target — Companies with which you would like to hold an investment process
Contact — Individuals at investment targets who can provide meaningful information
Broker — Third-party entities who may connect you with investment targets
Actions
Activities — Emails, calls, meetings with contacts at investment targets
Investment Process — The process towards obtaining a desired outcome with a target
Contracts — Legal documents (NDA, IOI, LOI, Purchase Agreement) indicating progress
Each level represents increasing sophistication in tracking and connecting entities within your CRM system.
On the road to omniscience
The five levels of CRM sophistication — from basic organization to complete operational intelligence.
Organized
Curious
Knowledgeable
Enlightened
Omniscient
From Level 2 to 5 in 30 days
This case study covers the transformation of one of the largest software investors in the world. This investor leveraged a decentralized operating model with several dozen independent investment teams rolling up into a smaller number of portfolios.
The starting point: Level 2 challenges
Learning opportunities were hindered by low data quality and the massive manual effort required for any sort of analysis/experiment (90% of the time was spent compiling clean data).
Investment process replication
The investment process was fully replicated in Salesforce, granting a clear image of investment operations on a daily basis.
• Fully automated pipeline reporting was available with full insight into every step of the investment process including key milestones and deal velocity.
• In-depth parametrization and connectivity between entities allowed for a complete understanding of lost processes and important market participants and trends.
• An interactive and intuitive investment process workflow was implemented to guide employees through the new operating procedures.
Interactive workflows guide users through the investment process.
Automation and data governance
Gone were the days of employees using different units for the same parameter, entering incorrect data or leaving crucial parameters blank.
• Strict data validation removed manual errors, forced the population of critical data points, and restored trust in data quality.
• In-depth automation meant fields were populated automatically, historical changes were tracked for all important parameters.
• Administrative data requests were handled by a centralized support team and could be requested through a ticket system built directly into the CRM.
Automation handles repetitive tasks and ensures data quality.
Data model expansion
Several new entities and actions were added to the investor's data model in order to fully capture every internal and external driver affecting their investment operations.
• Dozens of new parameters were exposed across the many entities and actions in the investor's Salesforce model, granting complete insight into every step.
• Insights and learnings became available immediately with analyses and experiments not only trivial to perform, but also easy to modify and repeat through time.
• Unlimited learning opportunities were unlocked across all investment operations.
A rich data model unlocks unlimited learning opportunities.
Transparency makes the world go round
This particular investor had a relatively unique lead allocation process which caused them quite a headache.
Lead allocation rules
• The team that added the target obtained exclusive ownership for one year
• After one year, if no dialogue established, account became open for contact
• Other teams could request ownership if they established dialogue
• Ownership changes required executive approval via email
The headaches
• Backlog of requests could pile up or be lost
• Lengthy investigations if evidence not entered in Salesforce
• High-stress conflicts consumed hours of executive time
• Investment targets frustrated by multiple team contacts
Integrated solution
• New "Transfer Request" entity connected to employee, activity, and investment target
• Button on company profile to initiate transfer request
• Required contact and activity evidence to submit for approval
• New portfolio-level role for pre-approval before escalating to head office
The results
• Full visibility into lead allocation process and its benefits/drawbacks
• 50% less conflict between teams due to transparent process
• Low quality requests no longer submitted
• Significantly more data entered into Salesforce
• Clear understanding for investment targets on which team would interact with them
Take the time to add a cherry on top
This is just the tip of the iceberg. To get the most out of your CRM experience, consider adding these advanced features:
Lead Qualification
Automatic lead qualification and prioritization algorithms
Financial Integration
Multi-year financial information and deal structures
Third-Party Enrichment
Industry growth metrics, firmographic data, contact data
Process Integration
Integration of various related processes into a single workflow
Automated Reporting
Automated reports and dashboards covering every step of operations
Documentation
Built-in documentation to educate employees on best practices
30 days
From Level 2 to Level 5
50%
Less conflict between teams
90%
Time savings on analysis
Ready to transform your operations?
Tell us about your current setup. We'll walk you through what a transformation looks like for your organization.