Vidrio: Investors anticipate ‘hybrid’ due diligence going forward

Investors are not likely to return to in-person due diligence meetings in the coming year, according to new findings of a survey conducted by fintech firm Vidrio Financial.

The firm found that allocators anticipate a hybrid mix of in-person and virtual meetings for the next year, and one allocator indicating they were putting off in-person due diligence until 2022.

What we found was that as the pandemic has dragged on, working practices are fundamentally changing, and with that we expect how data is used and collected will continue to evolve as well,” wrote Vidrio Founder and CEO Mazen Jabban. “At Vidrio, we are in constant dialogue with our clients and potential clients to ensure we remain attuned to their business requirements and always evolving our practices and data systems appropriately.”

The spread of the delta variant has been causing widespread disruption throughout the U.S. as a number of financial firms have notably pushed back their initial office reopening dates as well. For trustees too, this means that board meetings will likely remain virtual too as their investment teams continue to forge ahead with vetting new investments while working remotely.

Most investors (62%) indicated that the process of allocating to new managers during the COVID pandemic with 38% indicating that the speed of the allocation process was not impacted by the pandemic.

Less encouraging however is some of the transparency with current private markets managers.

Within the same survey, allocators indicated that hedge fund data collection processes when it comes to private markets performance are still mostly not up to snuff as 63% of investors surveyed said they were working with portfolio managers to improve reporting.