Anyone who has worked in a role even tangentially connected to the public markets will at least have heard of Bloomberg Terminal, an industry standard platform used by professionals to gain real-time data and insights into the financial markets.<\/p>\n
Indeed, Bloomberg Terminal is an incredibly useful \u2014 if expensive \u2014 tool for traders, brokers, analysts and others concerned with the public markets. But those more aligned with the private sphere, such as venture capitalists and private equity investors, perhaps aren\u2019t quite as well-served when it comes to funnelling into the data they need to carry out their due diligence ahead of making a big investment, or tracking and managing their portfolio through to an exit.<\/p>\n
But this is something that French startup Edda is looking to fix, with a platform aimed at helping investors, analysts, chief financial officers (CFOs), and even company founders get the insights they need, and the tools that make working collaboratively on deals just that little bit easier.<\/p>\n
Investors invest<\/h2>\n
Edda was founded initially as Kushim VC back in 2017, but the company has just completed its official rebranded to Edda, while it has also announced $5.8 million in funding from a slew of backers including iPhone co-creator Tony Fadell\u2019s Future Shape;\u00a0 Mucker Capital; Plug&Play; FJ Labs; and angel investor Arnaud Bonzom. Its new investors are also fully signed-up members of the Edda platform, as are some 100 other investment firms spanning 26 countries including French public investment bank BPI France.<\/p>\n
\u201cMuch like Bloomberg altered an industry\u2019s ability to operate, Edda will transform how investors visualise their fund and manage their dealflow and relationships,\u201d FJ Labs\u2019 founding partner Fabrice Grinda said in a statement. \u201cVenture capital and private equity in general has gone from strength-to-strength over the past decade, spreading into new sectors and becoming the cornerstone of innovation investment.\u201d<\/p>\n
So what, exactly, does Edda give those working in the private investment space?<\/p>\n
\u201cEdda enables secure transparency for everyone managing an investment portfolio, from deal-sourcing to due diligence and funding through to portfolio management,\u201d Edda cofounder and CEO Cl\u00e9ment Aglietta explained to .<\/p>\n
Those unfamiliar with the inner workings of the private investment realm may be surprised to learn that spreadsheets play an outsized role in the administration of everything \u2014 it\u2019s typically a very manual endeavor according to Aglietta, who previously plied his trade as chief of staff at New York-based investment firm FJ Labs.<\/p>\n
\u201cThe lack of solutions for the private markets was the primary reason that I founded Edda,\u201d Aglietta said. \u201cPrivate equity investors currently manage more than $6.5 trillion \u2014 however, the majority of these investors still rely on tools such as Excel spreadsheets to manage their portfolios.\u201d<\/p>\n
It\u2019s maybe something of an over-simplification to suggest that investors just use spreadsheets \u2014 in truth, they use an array of tools\u00a0through the entire investment process. This may include Airtable or Salesforce for workflow management, or Affinity, Zaplow, and Sevanta for dealflow (the number of potential investment opportunities). Elsewhere, portfolio management software from EFront and Ipreo have proven popular among investors, with both companies acquired in separate deals for a combined total of more than $3 billion in the past few years.<\/p>\n
So Edda already has some competition beyond dusty-old spreadsheets, but what it\u2019s pitching is an all-singing, all-dancing tool covering all bases.<\/p>\n
\u201cWe believe that it\u2019s time for funds to have a dedicated tool with multiple capabilities that helps partners to see the big picture, that does everything they need,\u201d Aglietta said.<\/p>\n
In terms of dealflow, Edda integrates with email inboxes and calendars to support workflow automation with tasks and reminders. It also sets out a clear schedule and layout for what stage each potential investment is at through a dedicated watchlist.<\/p>\n
Edda watchlist for dealflow<\/p>\n<\/div>\n
For the existing portfolio, Edda allows investors to record historical valuations for all their companies, run valuation comparisons, and calculate IRR (internal rate of return) on an individual company basis or for the entire fund. It also serves investors with analytics that show how well their portfolio is aligning with their core investment focus.<\/p>\n
![\"\"](\"https:\/\/www.ghanamma.com\/gp\/wp-content\/uploads\/2022\/09\/275b40b4bfc7201a0ea377dec7962ffde2c16985-2032x1266-1-e1662541838685.webp.jpeg\")
<\/p>\nPortfolio performance<\/p>\n<\/div>\n
Show me the data<\/h2>\n
Edda reels in data from publicly-available sources including Crunchbase and Pitchbook, while it also packs a feature that automatically pulls in additional data from emails, documents, and files stored in cloud-based repositories such as Dropbox. And on top of that, Edda has also developed an API that tracks news relating to companies, funds, and everything related to the deal-making process.<\/p>\n
\u201cAll of this information, and data points, are then used to generate a profile on the company,\u201d Aglietta said. \u201cInvestment decisions are increasingly driven by multiple data points, so you
need as much information as possible to ensure you make good decisions \u2014 this is what Edda provides.\u201d<\/p>\n
To illustrate how this might all play out in a real-world scenario, Aglietta highlighted an example that involved an investment fund partner who received an email about a potential investment opportunity. Given that this partner was using an email plugin provided by Edda, the platform automatically captured the name of the company, and checked if it was \u201calready in the pipeline\u201d at the fund, and then synchronized this with public information from Crunchbase and Pitchbook.<\/p>\n
\u201cThe deal is automatically sent to the pipeline for the rest of the investment team to start working on it collaboratively, by adding comments, reading the documents and the emails already exchanged with this company,\u201d Aglietta said.<\/p>\n
Edda then generates a slide for each company in the pipeline, which is reviewed weekly until the investor decides to invest \u2014 at that point, Edda pushes the company into the portfolio management section where it generates a profile with key information such as revenue and capitalization table. At this point, the company founders can be invited to collaborate through Edda, where they can update information themselves and communicate with all the main stakeholders.<\/p>\n
And this highlights the core business community management facet of the Edda platform. It reflects the reality of today\u2019s investment landscape, where financiers may put their money into any number of companies around the world, which requires having to work with partners (including other investors) and founders from all backgrounds and levels of technical expertise.<\/p>\n
\u201cThe market is getting more and more complex \u2014 investors invest globally, and there are more and more deep technologies that investors need to be knowledgeable about to make good decisions about where to deploy capital,\u201d Aglietta said. \u201cWe all know that it\u2019s not possible to be an expert in everything, that\u2019s why investors are heavily focused on co-investment opportunities, communicating more with companies founders, using the expertise of the LPs (limited partners), and so on.\u201d<\/p>\n
Edda supports this by serving as a centralized conduit for investors to upload documents, keep LPs up-to-date about deals, generate reports, share statistics, and more. And portfolio company founders can use Edda to ask questions and solicit advice, while investors can request specific updates and new metrics from the founders.<\/p>\n
![\"\"](\"https:\/\/www.ghanamma.com\/gp\/wp-content\/uploads\/2022\/09\/e9da5f08523086d5cfdd232aca9f4ef9892cee3a-1593x901-1.webp.jpeg\")
<\/p>\nEdda: Sharing performance data with LPs<\/p>\n<\/div>\n
Market opportunity<\/h2>\n
To give some idea of the potential for Edda, Bloomberg reportedly generates around $10 billion in revenue annually, the vast majority of which apparently emanates from its Bloomberg Terminal-driven Professional Services division.<\/p>\n
The private equity markets are predicted to grow to $12.5 trillion by 2025, and for many investors it\u2019s a far more alluring proposition. Edda, for its part, currently works with investors with just $22 billion in assets under administration, which gives some indication as to how much further it could grow.<\/p>\n
\u201cThis [private] market is huge and is booming \u2014 it\u2019s now bigger than the public market,\u201d Aglietta said. \u201cThere are more companies, the total valuation is higher, and the amount invested is also higher.\u201d<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
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