Deal insights are what make private capital firms more efficient. Recent data shows just how necessary they are—according to Affinity’s 2024 Investment benchmark report, the average time spent researching a deal went up 10 hours in 2024 compared to the previous year.
Deal insights help private capital firms focus their energy on deals that are most likely to close. They make sense of the chaotic reality of relationship management by translating every meeting, email, firm contact, and publicly available piece of information into the actions most likely to lead to a deal.
Keep reading to learn more about deal insights, including why they’re important and how to get the most out of them to close more deals.
What are deal insights?
Deal insights—served to venture capital and private equity firms via a customer relationship management (CRM) platform—are the interpretation of private capital deal data, such as deal progress, relationship intelligence, deal health, and likelihood of success. With solutions that provide deal insights, you can also eliminate manual data entry by automatically pulling data from your inbox, calendar, and browser to enrich contact and company records with qualitative and quantitative data that all deal stakeholders can access.
It’s important to remember that deal insights aren’t just raw data insights—they’re data-backed recommendations for how to best spend your time so you’re closing more deals.
Why are deal insights important for private capital firms?
Deal insights are important for firms because relationship management is both resource intensive and crucial for closing deals.
Partners and associates have access to more contact and company data than ever, but that data is almost useless without an easy way to translate it into action. This is where deal insights can help.
Here are three reasons why you should invest in advanced deal insights for your CRM:
1. You can find actionable insights amidst mountains of data
The investment landscape is complex, especially as dealmaking remains a struggle in 2024. Firms need to focus on nurturing the relationships most likely to lead to a deal.
At the same time, firms are swimming in data. Compared to 2023, when 22% of firms used 7+ data sources to make decisions, that number is now closer to 30%.
Deal insights exist at the crossroads of efficiency and volume—they allow firms to make sense of an overwhelming amount of data while focusing on relationships most likely to lead to deals.
2. You can enhance relationships with portcos
As closing deals remains a challenge, many firms are focusing on nurturing the companies in their existing portfolio—all in service to coveted exits.
Deal insights have been proven to improve overall engagement metrics with founders and executives, by making it easy for teams to allocate resources towards tasks that lead to better onboarding and support.
3. You gain a deeper understanding of your deal pipeline
By tracking a combination of deal signals, company performance indicators, and communication touchpoints, firms gain a contextual understanding of their pipeline—which is a better reflection of reality than what surface-level metrics can provide.
For example, if your firm notices a significant increase in healthcare sector deals despite a general decline in other sectors, you can allocate more resources to sourcing and evaluating healthcare deals and adjust your strategy to focus on adjacent high-growth areas.
How to get the most out of your deal insights
To get the most out of your deal insights, you’ll need to understand how to analyze the data and tap into relationship intelligence, with the right tools.
Centralize your deal pipeline data
The more data sources you have to analyze, the more potential there is to identify high quality deals—but the more difficult it can be to get a handle on the data.
For example, Future Planet Capital used a whopping 500,000 data points to develop its sophisticated scoring system for 500 companies in its deal pipeline. Centralizing the data in one place that is accessible across the firm revealed inefficiencies that a fractured approach just couldn’t.
“We were very diligent about mapping out how each of us are spending our time, identifying where that time is unnecessary or unproductive,” said Peter Mitchell, Head of Origination, “then being very purposeful in trying to find solutions that reduce that time.”
Tap into relationship intelligence
Deal flow data is essential for closing deals, but everyone knows what actually seals the deal—relationships. But that doesn’t mean “data” and “relationships” are siloed categories.
AI-powered relationship intelligence is what allows you to make the most of your entire firm’s network by revealing who can introduce you to key founders, executives, and investors. This saves firms hours of time on deal sourcing and manual data entry, while fast-tracking warm introductions that can lead to a deal.
Use a deal insights tool
Your CRM is a great single source of truth for your deal pipeline, but it may not be enough to serve up the kind of deal insights that lead to true efficiencies. This is because traditional CRMs rely on a lot of manual data entry, which means deal flow data may not be as enriched as it could be.
A deal insights tool can help automate a lot of this data enrichment by pulling existing information from your inbox, calendar, and browser into your CRM, thus combining firmographic data with relationship intelligence.
Affinity: The comprehensive deal insights tool
The Affinity CRM is purpose-built for private capital firms, allowing them to find, manage, and close more deals using deal insights.
For firms already using Salesforce, the Affinity for Salesforce solution makes it possible to enrich your Salesforce records with valuable relationship insights that help your teams find warm introductions and engage with new opportunities. Affinity for Salesforce uncovers more qualified opportunities by:
- Automatically capturing contact, account, and activity data in Salesforce
- Integrating CRM data with the tools you use every day, like your email, LinkedIn, or your browser when you’re on a prospect’s website
- Showing data in both VisualForce objects and natively within Salesforce fields, so you can use it for sourcing, engagement, and reporting
Learn how to put theory to practice with Affinity’s 2024 deal sourcing guide for venture capital. You’ll find out how to:
- Become a data-driven dealmaker
- Elevate relationships to source deals
- Maximize your use of technology
Deal insights FAQs
What are deal insights?
In a CRM, deal insights are the outcome of data analysis and interpretation related to investment deals. Deal insights provide an actionable understanding of a deal’s status and performance, and they’re often powered by machine learning algorithms that analyze and translate data from various sources such as CRM records, emails, calls, and notes.
What is the difference between sales insights and deal insights?
Sales insights focus on optimizing sales strategies and customer relationships, whereas deal insights analyze investment opportunities for more efficient and profitable deal flow management.
What are key deal insights private capital firms should track?
Private capital firms should track:
- Financial data: Internal rate of return (IRR), distributions to paid-in capital (DPI), revenue growth, etc.
- Firmographic data: Industry growth trends, market share, executive experience, etc.
- Relationship intelligence: email and meeting interactions, firmwide connections, overall relationship quality, etc.
Deal flow data: deal sources, average time to close, sector-specific deal activity, etc.
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