FinTech cuts 66% of duplication in Operational Due Diligence for investment managers

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Along with allocators, investment managers are the biggest beneficiaries of the FinTech revolution that’s shaking up the dated ways operational due diligence is performed on investment managers.

At the moment, thousands of investors use in-house spreadsheets or a proliferation of online survey tools to send their own unique lists of due diligence questions to asset managers and GPs. While higher value questions may be investor specific and material to an investment decision, basic data – the first 50% of due diligence – is the same for all allocators. Yet, for managers / GPs, many investors asking for the same core data, but in slightly different ways, creates enormous duplication and time burden for IR teams.

In a recent Castle Hall survey of asset managers, 100% of firms reported that at least half of investor DDQ questions overlapped. More starkly, 60% stated that investor requests were highly duplicative, with at least two-thirds of investor questions duplicating data already requested by other allocators.

Castle Hall’s new DiligenceExchange eliminates the waste of duplicative ODD, functioning as an industry utility where managers and investors use the same framework to share reference information, needed as part of every due diligence review, in a standard format. DiligenceExchange is not, however, just a web DDQ platform which simply transfers a manager’s / GP’s information to investors. Castle Hall conducts their own due diligence work, including “trust but verify” anti-fraud checks such as service provider verifications, as part of every DiligenceExchange report.

Hear from Chris Addy, CEO of Castle Hall:

  • The 7 reasons why global asset managers representing more than $10 trillion in AUM have already adopted the DiligenceExchange (DXC) standard
  • Easy onboarding: How DXC speeds up the investment process for both investors and investment managers
  • Free marketing: Every DiligenceExchange Transparency Report is immediately visible to Castle Hall’s 200+ existing investor clients. However, managers / GPs have complete control and visibility over permissioning and report distribution, controlling all investor connection requests from a central administrative account.
  • What type of information is covered in a DXC Transparency Report
  • 250 risk factors: How the groundbreaking DiligenceExchange benchmarks, based on DXC’s standardized industry-wide data, offers unprecedented insights for both investors and managers and enables evidenced, data driven decisions.
In a preceding video feature, Chris Addy explains to the global allocators and end investor community how DiligenceExchange works best for them:

Investors and allocators can get free access to DiligenceExchange here:

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