Amsterdam. Third coffee. Notebook open.
‍

I've just come out of a two-hour conversation with a CFO who runs a mid-sized PE fund - sharp operator, genuinely data-literate, and absolutely not going to do anything about any of this for at least another three years.

‍

Why? Because he's on his last fund cycle. Retirement is visible from here.
‍

And the last thing he needs - the very last thing - is to open up the operating model, bring in a challenger fund admin, and then spend eighteen months explaining to his IR team why they now have to go back to every LP and reframe how the whole back office works.

‍

"Better the devil you know" isn't just a phrase in this industry. It's a career strategy.

‍

And look - I get it. I do. There's a particular kind of institutional inertia that makes complete rational sense when you're the one who'd have to manage the change programme, absorb the internal politics, and personally field the LP calls asking why the quarterly pack looks different.

‍

But here's the problem.

The data silo issue that everybody in private markets is quietly drowning in - fragmented systems, unreconciled records, five platforms bought in three years with no one actually owning what flows between them - that doesn't retire when he does.

It lands on whoever comes next. Probably someone younger, probably under more LP scrutiny, almost certainly facing tighter regulatory requirements under AIFMD II and DORA. And they'll inherit a tech stack assembled around the previous person's appetite for risk, not the fund's actual data needs.

‍

The real structural problem isn't the technology. It's the incentive gap between who makes the decision to change and who lives with the consequences of not changing.

‍

Right now, the GP, the auditor, the data vendor, and the fund admin all hold a fragment of the same fund's data - each optimised for their own workflow, their own close schedule, their own renewal metric. Nobody owns the whole picture. Nobody is structurally accountable for what sits between the systems.

And so the data stays siloed. AI gets layered on top of it. Everyone calls it a transformation. The retiring CFO nods along at the conference panel.

‍

Fund administration is the connective tissue here - the only party that actually touches every data flow across a fund's lifecycle. But as long as it's framed as a cost centre to be minimised rather than a governance layer to be invested in, the incumbents will keep winning on inertia alone.

‍

The firms that close this gap won't do it by buying more point solutions.

They'll do it by redesigning who is accountable for the data between systems - and making that accountability legible to LPs and regulators before someone makes it mandatory.

Anyway. The CFO and I ended up agreeing on most of this over a second espresso.

‍

He said he'd bring it up with his successor.

Flight to Luxembourg in an hour.