Digital tools essential for modern day due diligence - AVCJ Forum

“We have databases that allow us to take transactional level data of potential target companies and literally match the purchasing managers’ surnames to see if they happen to correlate to the shareholders of a company that is a major supplier. That is an example of how data analytics and interregional databases help us to uncover things that used to be really difficult to find out,” said Andrew Thompson, head of private equity for Asia Pacific at KPMG.

Thompson added that KPMG has committed $2 billion across a range of digital projects. While smaller scale PE and VC firms are not able to make the same kind of investment, they can find other ways to leverage technology.

Kyle Shaw, founder and managing partner at Shaw Kwei & Partners, an Asia focused middle market GP, highlighted how digital tools have made supply chains more transparent. "Products can be traced back to where they were made, as well as the performance after they are sold to customers, which could be helpful in improving the efficiency of marketing those products,” he said.

Technology has enabled a similar level of transformation in cash flow verification and anticipation of fluctuations in companies’ working capital, added David Shen, a regional managing director at Olympus Capital Holdings Asia.

“Going forward, digital tools such as social media platforms will fundamentally change how consumers and some businesses make their decisions. As such, it’s critical for GPs to fully understand the trend and embrace the impact,” Shen said.

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