How to implement a private capital CRM

As your firm scales from one fund to the next, your back-office operations need to keep up. Key inflection points happen when a firm wants to better manage and use its network to drive deals, centralize data for analysis, and work more efficiently within industry-specific workflows. The solution: a customer relationship management (CRM) platform.

However, many CRM implementations fail—from 30% up to 70%. Successfully introducing a new system requires finding the right solution, then managing the change so your team actually uses it. 

CRM strategy is something Lauren MacDonald, Principal at Sozo Ventures, knows very well. Continue reading for best practices, step-by-step guidance, and expert advice from MacDonald’s successful implementation of the firm’s CRM.

Part 1: Pre-CRM implementation plan

A. Assess organizational need

To determine your firm’s business needs, start by evaluating team size, deal volume, location, and timeframe. Your team’s growth rate can be a key indicator of a need for change. MacDonald describes this moment for Sozo Ventures: “It became very apparent to the team that we needed more process and structure. We jumped from 19 to 29 team members, and a deal flow management system was absolutely necessary.”

If team members are geographically dispersed, consider the impact of time zones. You will need a platform optimized for asynchronous work.

There are cost considerations and ROI metrics that can help indicate the right time to implement CRM software. Time savings and higher CRM user adoption are quantifiable metrics, whereas the need for an improved ease of use, heightened security, and stronger relationships are intangible but important when deciding to move to a new CRM.

Finally, be clear on whether you’re looking for a traditional CRM or one purpose-built for private capital. While the former may seem cost-effective, the latter has several advantages:

1. Automation: Rather than relying on third-party tools, CRM platforms like Affinity use built-in automation to ensure seamless data capture and management. This reduces manual data entry by hundreds of hours per year.
2. Data enrichment: Deal research takes time, and typically involves switching between multiple platforms and browsers. Some private capital CRMs aggregate deal-ready data and present it within the platform itself. For example, Affinity pulls in data from more than 40 premium sources including PitchBook, Crunchbase, and Dealroom.‍
3. Relationship intelligence: Private capital professionals have some of the largest networks in the world. Relationship intelligence turns your firm’s communications data into actionable insights on your network including full history, relationship strength, and sources of potential introduction.

B. Analyze stakeholder needs

Your CRM solution should be the system of record across your firm. All teams working from the same platform allows for seamless deal management from initial sourcing through due diligence to close and handover to the portfolio support team (which should, ideally, also use the CRM). 

With this in mind, identify key users and their business goals across all departments. Map out the information they will enter into (and take out of) the CRM, and note any specific timing requirements during the deal flow process. 

MacDonald suggests casting a wide net at this point. She says, “When you think about deal flow planning, you immediately think, I'm going to talk to the investment team and the partners. While that's super important, talk to folks in every function, depending on what your team and firm look like. Make sure that the platform folks and the finance team give inputs and that they’re part of the process as you develop your new deal flow pipeline.”

C. Build internal support

MacDonald’s advice for anyone taking on the role of project manager for a new CRM is clear: “Don’t go at this alone. So many of us try to, and it's a heavy lift. I recommend finding a champion within your firm. One of our Managing Directors was a huge supporter of rolling things out. That helped a ton, so I wasn't the only voice shouting in the room.”

Build an implementation team by securing executive sponsorship from someone senior at the firm. They can help build excitement for the change and keep the team motivated. Among those who will become regular users, identify who can be an internal champion for the project (these people can also help during the pilot program step in Part 3).

MacDonald also recommends finding allies outside the firm who can advise on the CRM implementation project. She says, “Find people at different firms who are responsible for rolling things out. Lean on the community around you because it can feel pretty isolating to be the only one in the firm saying we have to do this.”

Watch Lauren MacDonald’s session at Campfire 2024 to learn more about her CRM implementation experience.

Part 2: System design and setup

A. Establish pipeline structure

Every firm structures its pipeline slightly differently. For a CRM to work for your team, it needs to be set up in a way that aligns specifically with how your deals move through each stage—or status—in your pipeline. 

MacDonald says, “Map who is going to do what by when for each status, so that it's super clear when a company enters the status.”

This means that, rather than considering at a high level how your firm moves companies through the pipeline, map out the details. MacDonald says, “What is the right number of statuses to have in your pipeline? There is no set playbook to follow. When you have too many statuses for your team, it can be extremely complex. But when you have too few statuses, it's not going to be detailed and granular enough to actually drive action.”

For each status, answer the following questions:

• Who is responsible for each stage of the pipeline?
• What specific tasks do they need to complete at each stage?
• When are they responsible for completing those tasks?

MacDonald explains, “The first two questions are pretty common sense and standard but the third part is often forgotten. It's super critical because it doesn't matter if your information is great if it comes way after you actually need it.”

B. Set up access controls

With private capital firms responsible for reams of sensitive data on both deals in motion and portfolio companies, advanced permissioning is a critical CRM capability. 

While outlining pipeline structure and key responsibilities, also consider who can make certain changes to the CRM. For example, think about:

• Who's going to add and move companies down the pipeline? 
• Who's going to view and access a deal list? 
• Who will be able to edit company or contact profile fields?

MacDonald provides an example of how this works at Sozo Ventures: “There are three of us who can add and move companies down the pipeline, out of the big firm of 30 people. I could just imagine the chaos if everyone was moving stuff around. Put some boundaries in place to help yourself stay sane and to ensure you have clean data to start."

You may also want to consider whether there are specific people or groups that shouldn’t have access to certain information. At Sozo Ventures, this was a group of interns called Sozo Scholars. MacDonald explains, “We set up teams to be able to say: show this to scholars, or don't show it to scholars. Almost all of our notes are shared with the whole firm, but for these instances, we can control through different permissions.”

C. Begin integration planning

Your CRM cannot exist in isolation. To become a trusted system of record, it needs to connect with existing workflows and tools in your tech stack. Are there off-the-shelf native integrations that can be easily implemented? Or will it take time to build custom integrations?

Think about the data that needs to flow between different tools and where it makes sense for changes in the CRM to trigger notifications and alerts in other tools. For Sozo Ventures, connecting the CRM with Slack meant being able to notify teams of relevant changes to their workflows.

She explains, “We thought about the full pipeline of our deal flow and segmented it to the most appropriate team. For example, our finance team is mildly interested at the top of the funnel, but as things come closer to a deal actually closing, then they start to put their antennas up. So we created a Slack channel specifically for them that is highly aligned to all of the statuses that they need to be notified about.”

Download the CRM implementation checklist to easily follow this process step-by-step.

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Part 3: Implementation strategy

A. Launch a pilot program

Up to 70% of CRM implementations fail, with top reasons including lack of strategy, lack of attention to process, too little focus on people, and low adoption.

A pilot program will help identify challenges associated with your colleagues and their willingness to adopt the CRM, allowing you to find solutions before going live. Select a test group of users (ideally including the internal champions identified in Part 1) and run an initial trial period for a couple of months.

MacDonald likens this to the approach taken by many startups: “Just like they do MVPs or pilot programs, we took that advice internally and worked through some of the hiccups and bumps so that we felt much more confident when it came time to roll it out to all 30 people.”

Along with training (covered in the next section), equip yourself with resources like video tutorials from your CRM vendor so that early users feel empowered during the onboarding process.

B. Create documentation and training

Users learn in different ways, and preparing for this before rollout can save time further down the road. While setting up for the pilot program—and incorporating learnings as it progresses— create user training in multiple formats.

For Sozo Ventures, this included a Zoom video, a slide deck, and long-form written materials that covered each detail of the new deal flow pipeline process. MacDonald says, “You will thank your future self when a new person rolls onto the team and you can hand them this nice package. It's not a substitute for having conversations, but it gives them a head start to wrap their head around the process at their new firm."

When a conversation is required, publicize office hours or training sessions to help users adapt. Change management is critical, as MacDonald reflects: “Sometimes people have a little question they feel silly about asking, but if you show that you're there to help support them, it makes it easier.” 

The questions you answer in these sessions should be reflected in the training materials so that they become iteratively more comprehensive over time.

Watch Lauren MacDonald’s session at Campfire 2024 to learn more about her CRM implementation experience.

Part 4: Maintenance and optimization

A. Manage data quality

A CRM is only as useful as the data it contains. For that reason, it’s critical to get the initial data migration right. This applies whether you’re transitioning customer information from an existing system or another tool like spreadsheets. The data in your CRM needs to be as accurate as possible from the start if your team is to trust and use it. 

Discuss with your vendor how the customer data sync process works, how long it takes, and how much cleanup will be needed afterwards. If your new CRM automatically makes updates based on user email and calendar data, find out how regularly this sync occurs and what exactly is pulled in.

Regardless of how automated the process is, regular maintenance will still be required. MacDonald is clear on this: “Assign a person and a process to clean up your data. It might be you, it might be someone that you tap, but implement a cleanup process to remove duplicate entries. It's always going to happen, it doesn’t matter which firm you're at."

Data entry protocols will help here. This essential guide to CRM data maintenance outlines best practices for ensuring data quality—from email and phone validation to managing duplicate entries.

B. Plan for continuous improvement

Collecting regular feedback will keep your CRM implementation process on track. There may be tweaks to the process, or additional detail to add to training documentation—overall, users will be more satisfied with the solution if they feel their voices are being heard.

Sozo Ventures did this via a survey one month and one quarter post-implementation. MacDonald advises keeping questions general. “I made it broad so folks could provide feedback, tell me what worked, and tell me what they wish would happen next. It’s a way to check in periodically to see how things are going.”

Reviews aren’t just for internal use, either. Touch base with your vendor at least once per quarter and see what’s new with the platform. This is an opportunity to share learnings, particularly if you’ve received feedback that should be relayed to the product team.

MacDonald describes her reciprocal relationship with the firm’s customer support: “I go to them saying, ‘Hey, I'm working on this thing. How can you help?’ But I also ask what's going on with other firms. What are they working on? What new features are coming out? We have a conversation to learn from each other.”

This information can then be fed back to the team through regular communication. For MacDonald, it’s a bi-weekly email: “This is the time where I can share new Affinity features with the team. I can write a little note, show the link to them, and they now know that these updates come on a regular cadence.”

Download the CRM implementation checklist to easily follow this process step-by-step.

Part 5: Maximizing business impact

A. Drive deal flow efficiency

Deal sourcing and management are the top priority for almost 70% of dealmakers, according to our 2025 predictions report. And in a more competitive market, efficiency is key.

To drive efficiency, track the pace of deal flow and monitor areas that may need extra attention. As MacDonald puts it, “Sorting your whole pipeline by time in current status will quickly show which ones have been stuck and need conversations to help identify how to move it forward.”

Are there CRM extensions that could help reduce context-switching and enable dealmakers to work faster? Or a mobile app that allows the team to manage deals on the go?

For MacDonald’s team, Affinity’s Chrome extension Pathfinder helps drive efficiency. She says, “Pathfinder is an awesome tool that brings all your info from Affinity right into your email browser and when you visit different websites.”

B. Optimize visibility and collaboration

Having a CRM as your firm’s system of record drives more collaborative dealmaking. When every detail is visible across the firm, it’s easier for teams to work together—regardless of deal complexity. A CRM with relationship intelligence analyzes communications data to provide relationship insights and strengths, allowing anyone on your team to quickly identify who can provide a warm introduction to a new deal.

The benefits go beyond deal sourcing and management workflows. For example, Sozo Ventures uses its comprehensive database of founders and limited partners (LPs) to facilitate introductions that drive portfolio growth. 

MacDonald explains what this looks like: “Sozo uses opportunity lists to track LP and startup pairings and intros that we do so that we can track two organizations as a singular record. This is super helpful because we want to, not just track individual companies one at a time, but also these introductions.”

Download the CRM implementation checklist to easily follow this process step-by-step.

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Build your competitive edge with a successful CRM implementation

Launching a new CRM system requires careful planning and dedicated resources, but the benefits of a well-implemented CRM extend far beyond basic contact management. As this guide shows, a CRM can streamline deal flow, enhance collaboration, and provide valuable relationship intelligence that gives your firm a competitive edge.

Key takeaways for an effective CRM implementation include:

• Securing early buy-in from important stakeholders and executive sponsors
• Taking a methodical approach to system design and setup
• Investing time in proper training and documentation
• Maintaining consistent data quality standards
• Gathering continuous feedback and optimizing the system

This isn’t a one-time event but an ongoing process of refinement and optimization. As your firm grows and evolves, your CRM should adapt to support changing needs and business processes. Regular check-ins with both your team and your CRM vendor will ensure the system continues to deliver value and drive efficiency in your dealmaking processes.

Download the CRM implementation checklist to easily follow this process step-by-step.

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