This startup is helping PEs, VCs, family offices streamline their investment processes
Founded in 2013 by Anup Kumar Adlakha and Ankur Agarwal, Gurugram-based PE Front Office provides end-to-end investment management solutions for private equity (PE) and venture capital (VC) funds and family offices.
After making record-breaking investments in 2021—nearly $24.1 billion (a report by Nasscom and Zinnov) poured into the Indian startup ecosystem—it would be unfair if we don’t discuss the innovations made for the investment firms.
Venture capital (VC) firms are not alien to digitisation. Their interaction with technology is limited to their back-office operations, including administrative and accounting tasks, maintaining spreadsheets, recording analysis, evaluation, and tracking of companies. For this, they partner with tech support providers and pay them for the software.
However, only a handful of options are available for front-office tasks such as sales, portfolio management, client servicing operations, or middle-office operations, including risk management and corporate strategy.
, founded by Anup Kumar Adlakha and Ankur Agarwal in 2013, is solving this problem.
The Gurugram-headquartered company provides end-to-end solutions for private equity and venture capital companies—from portfolio monitoring to investor management, fundraising to deal flow, fund administration to investment management, etc.
The idea
Earlier, Anup and Ankur worked at UK-based private equity (PE) firm Actis, where they noticed a gap in the market—technology solutions available for this space only address the needs of the back-office, including fund administration and account.
“The technology solutions in the alternative investment space are either not end-to-end or very bulky in terms of cost, ease of configuration, and ease of use,” Ankur tells YourStory.
With a firsthand understanding of these pain points, the duo decided to solve the problem by themselves. Initially, PE Front Office was supposed to cater to all PE firms and their technology requirements.
Gradually, it moved to venture capital (VC) firms, real estate and debt funds, distressed debt funds, funds of funds, and family offices.
Addressing portfolio companies and investors
Over the last 10 years, the startup realised that VC firms have different workflows, albeit similar investment strategies.
Usually, a VC firm takes funds from investors to invest in companies that ultimately become a part of its portfolio. However, the process of deciding where to invest isn’t straightforward.
Investors, who give their money to PE, VC, or angel funds, expect higher returns than other asset classes because of the associated high risk.
Thus, before investing, these firms need to research, analyse, deliberate, and monitor the industry and company’s performances. They scout for numerous deals, decide what is promising, and do due diligence on these companies.
They require customisable offerings for monitoring, management, and communication. Ankur says the startup had to develop a solution—about 80-90 percent could be used the way it is, and the 10-20 percent gap accounted.
Although investing for a few years, these VC firms need to regularly monitor their portfolio companies’ financial health, their investment returns, etc. They also look for potential investors, track their investment strategies, share documents, and manage relationships with them.
PE Front Office’s software allows these firms to do all of these through its customer relationship management offering, which also generates analytics and reports.
Ankur says the startup ensured it removed bottlenecks related to cost, availability, and customer type. PE Front Office also worked to reduce the implementation cycle and can go live with any client in less than 10 days.
Moreover, it has added plug-ins with Gmail and Outlook to facilitate communication using the software, making it easier for customers.
Journey and way ahead
PE Front Office, a Software-as-a-Solution (SaaS) startup, charges its clients (VC firms) based on the number of users.
“Our customers don’t have a huge in-house technology or IT team to manage their system. They don't want to have the hassle of managing the system getting back-ups,” says Ankur.
Further, PE Front Office offers its solution on an open-source framework, removing the need for a long-term commitment and a technology licence. “This has helped us become competitive in terms of costs, and as a SaaS startup, we operate a pay-as-you-go model,” Ankur notes.
Offered on the cloud, users can access it on their desktop and Android and iOS apps.
PE Front Office—with over 40 employees—has over 100 customers across 15 countries, including the US, Canada, UK, Singapore, Hong Kong, and India. Its clients include Chiratae Ventures, Fireside Ventures, Edelweiss, etc., who have made over 1,100 investments through its software.
Next, “We want to aggressively focus on the US as we have a lot of customers there,” says Ankur.
Bootstrapped with an initial capital of $250,000, PE Front Office aims to reach $1.5 million in revenue in FY23. It has not raised any funding yet.
According to the Registrar of Companies (RoC) filings, in FY21, the startup reported a revenue of Rs 3.35 crore, with a profit of Rs 22 lakh. Its FY22 financials are not available on the RoC portal yet.
The startup competes with the likes of France-based efront and US-based Dynamo Software.
(This story was updated to modify the headline.)
Edited by Suman Singh