One of the facts of life is when doing a private debt deal, getting the deal done is often the beginning, not the end of the work. Following the deal closing, every debt investor wants to have access to information about their borrower, but every borrower wants to get back to their day job; growing their business.
With these competing forces at play, it’s sensible for investors and borrowers to appoint third-party agents to handle their data and reporting. Here we explore the 3 main advantages of doing so:
Efficiency and Expertise
- Cost-Effectiveness: While there are fees involved, the efficiency gains and expertise offered by a third-party agent can outweigh the cost in the long run.
- Streamlined Processes: Third-party agents specialize in investor reporting, creating efficient workflows to gather data, compile reports, and distribute them on time.
- Reduced Internal Workload: Free your team to focus on core business activities while the agent handles the reporting burden.
- Technical Knowledge: Agents stay up-to-date on industry reporting standards and regulations, ensuring your reports are accurate and compliant.
- Software Expertise: Many agents utilize specialized software, saving you the cost and hassle of acquiring and maintaining your own system.
Accuracy and Objectivity
- Error Minimization: Agents have experience catching errors and inconsistencies, leading to more reliable reports.
- Improved Data Speed & Quality: Their expertise can help ensure data accuracy and consistency across all your investments.
- Reduced Bias: Third-party reports offer a more objective perspective, potentially boosting investor confidence.
- Enhanced Credibility: Having a reputable agent involved adds credibility to your reports, especially for new or smaller firms.
Security and Scalability
- Scalability: As your portfolio grows, in terms of size and the number of counterparties, a third-party agent can easily handle the increased reporting workload.
- Investor Portal Access: Many agents offer secure investor portals for report access and communication, improving investor experience.
- Robust Security: Agents often have robust data security protocols in place to protect sensitive investor information.
- Disaster Recovery: Their infrastructure can ensure reporting continuity even in case of internal disruptions.
Managing investor relations in private debt can be complex. By leveraging a third-party agent, you can streamline investor reporting, improve accuracy, enhance security, and free up valuable internal resources.
In today's competitive private debt market, efficient and insightful investor reporting is crucial for building trust and attracting new capital. Partnering with a third-party agent can give you the tools and expertise needed to deliver exceptional reporting that keeps your investors informed, engaged, and confident in your investment strategies.
Want to learn more about how Cascade provides third party data agent services? Book a demo with our team.
