After chalking up funding earlier this year, the data firm recently announced a major business deal and has more the pipeline, the CEO said. Turbulent markets have put a premium on handling investment data efficienctly and making it actionable.

Canoe Intelligence’s recent business win with private markets investment house Hamilton Lane – a New York-listed firm overseeing about $488 billion of assets at end-2019 – is the kind of progress that Canoe says is gathering momentum.

As announced in April, Hamilton Lane, which invested in Canoe’s series A funding round in February this year, is to use Canoe’s technology to automate data management tasks and accelerate access to new elements within alternative investment reports. 

Alternative investments such as private equity, capital, infrastructure and hedge funds create reporting and data gathering challenges - valuing illiquid assets efficiently is difficult for example. And in a world where a lot of data is unstructured, turning all that into information investors can understand and base decisions on is vital. And it is getting even more important as financial regulations increase. 

Current tough market conditions, lockdowns and associated problems, make it even more important to get this process right, Seth Brotman, chief executive of Canoe Intelligence, told Family Wealth Report in a recent call. 

“In my prior role as a capital allocator, I spent a lot of my time going through vast volumes of documents. When I needed information, I had to dig through thousands of PDFs, emails and other unstructured documents and enter that information into my systems manually,” Brotman said. “I then had to make sure I hadn’t made a mistake and that the data was correctly formatted. That whole workflow is what we focus on. We take a mass of data and transform it into intelligence.”

Canoe says that its technology can rapidly convert volumes of unstructured alternative investment reporting documents into normalized, accessible datasets, and track and organize associated documents. Canoe’s AI-driven platform was developed in 2013 for Portage Partners, a private investment firm, and is now used by institutional investors, service providers, family offices, and other allocators.

In February Canoe completed an early round of financing, involving strategic partners and advisors such as Nasdaq Ventures, Hamilton Lane (as already mentioned), Portage Partners, Promus Capital, and other alternative investment organizations. The firm was launched as a commercial entity in 2018. Canoe has relationships with investors, service providers, family offices, and allocators including StepStone Group, Lexington Partners, Canterbury Consulting and Truvvo Partners. Canoe was founded in 2013 within Portage Partners to streamline its operations and was spun out in late 2017.

The rise of firms such as Canoe reflects how an influx of money into alternative investment areas such as private equity and private credit is reshaping the investment landscape. While the coronavirus pandemic has massively disrupted markets, it is unlikely to hamper the need for the funds that alternative investment managers have at their disposal.

Wealth allocation experience
Brotman explained how his business experience has brought him to the wealth allocators’ side of the story. Well organized and judiciously selected information allows wealth management participants to stand out from the competition, Brotman said. 

“Availability [of information] is the ultimate ability,” he said. Information can, for example, show a client whether capital calls have increased or decreased.

Brotman said that Canoe’s offerings are increasingly sought after; there are lots of new clients coming on board and prospects in the pipeline.