Best Practice: Registry Management for Private Market Fund Managers

Best Practice: Registry Management for Private Market Fund Managers

Managing an unlisted investment fund’s unit register was once a cumbersome and risky task, often reliant on outdated, manual processes. However, the landscape has shifted significantly with the emergence of software-as-a-service (SaaS) solutions, which offer a more streamlined and accurate approach to registry management.

When selecting a registry management solution, it’s crucial to understand the available options, the services different providers offer, and their cost structures. This knowledge will help you choose the right solution for your fund.

“Historically, the appeal of using an outsourced registry provider was access to features like investor portals,” explains Danielle Pepi, an unlisted property fund operations consultant. “But that’s changing as SaaS solutions (which can be used in house) now also offer investor portals, digital subscriptions, and inbuilt AML and compliance processes. The playing field is levelling out.”

SaaS registry management allows funds to insource their fund administration, which brings numerous benefits, particularly in terms of brand development and building stronger relationships with unit holders. This approach is especially advantageous for funds experiencing rapid growth.

“When your operation is growing quickly, it’s important to remain agile,” says Danielle. “Using a SaaS registry management provider enables funds to distribute correspondence to unit holders swiftly.”

SaaS solutions also assist with tasks such as producing tax statements and calculating withholding tax for non-resident unit holders, ensuring that funds remain compliant and efficient.

Leaving the past behind

In the past, funds managed their unit registries using Excel spreadsheets, which, while functional, introduced significant risks.

“Traditional Excel spreadsheets are one of the riskiest ways to manage a fund,” Danielle notes. “People tend to design spreadsheets in a way that suits their personal thinking. If that person leaves the business, the next person might struggle to understand the logic behind the spreadsheet.”

Today, many unlisted funds are moving away from Excel and adopting cloud-based SaaS solutions, which offer a more reliable and cost-effective way to manage registries.

Danielle offers several tips for unlisted funds looking to improve their registry management:

• Be aware of key person risk: Avoid relying on a single individual to manage your register. Train multiple staff members to ensure continuity in case of illness, holidays, or staff turnover. “Also, make sure the team managing the register works closely together,” advises Danielle.
• Explore the market: The registry management space is evolving rapidly, so it’s important to understand the options available and their cost structures. This ensures there are no surprises down the road when it comes to additional service charges.
• Understand the work involved: “Get into the weeds,” says Danielle. Understand what your staff need to do to manage the register—there’s more to it than just maintaining a list of names.
• Don’t fear switching to a new system: Transitioning between SaaS registry management systems is relatively straightforward, much like switching accounting software. “If you’ve used one system, you’ll quickly pick up another,” Danielle assures.
• Maintain compliance oversight: Even when using an insourced or outsourced registry management solution, there’s a level of compliance oversight that remains your responsibility.
• Stay engaged with your SaaS provider: Maintain a good relationship with your SaaS provider and stay informed about their software development roadmap. “Providers often start with basic features and add more over time. It’s beneficial to know what’s coming and provide feedback on functionality,” says Danielle.
• Start off with a SaaS model: For new funds, it’s best to launch with a SaaS provider to ensure efficient and compliant registry management from the start. “Don’t bother with Excel,” Danielle advises.

Embracing the Future with SaaS Registry Management

The shift to SaaS registry management is revolutionising private fund operations, offering enhanced efficiency and tools to maintain high compliance standards. By adopting a SaaS model, funds can improve unitholder services with features like investor portals and online applications. However, it’s essential to assess different SaaS options, considering costs and development roadmaps, to find the best fit for your fund.

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