Dynamic investing

Krassen Draganov, CEO and founder of Dynamo Software, talks to Theo Andrew about the impact that the investor platform has across markets

What sets Dynamo apart from other real estate management platforms?

Dynamo has been a client-driven software development company for the past 20 years. We form collaborative partnerships with real estate managers to always ensure our software meets their unique investment management needs. Client feedback has an immediate impact on our product roadmap.

We build and maintain these strong relationships through our highly praised implementation and client services teams. Our people are experienced in not only technology, but also the financial services industry. Thanks to their hard work and dedication to clients, Dynamo maintains a more than 97 percent client satisfaction rating with our implementations projects.

Our implementation team’s average tenure at Dynamo is more than six years, which has contributed to their ability to configure the platform to each real estate investment manager’s specific needs. This results in an intuitive system that is easy for a firm to embrace.

What trends does the platform see across the real estate sector?

With offices around the globe, Dynamo benefits from gaining insight into the US, UK, European, and Asia Pacific real estate sectors. In Europe, Luxembourg is growing as a hub for alternative funds. We are also seeing fewer funds domiciling in UK offshore jurisdictions. In the Asia Pacific region, our team is seeing overall volumes as a whole down for 2017 compared to 2016. Asia Pacific transaction values in 2017 so far are $4.4 billion.

Rising asset prices globally have made deal sourcing a challenging process for real estate fund managers, with general partners having to invest more capital per deal. However, this trend is more pronounced in developed regions.

The average Asia Pacific deal size has risen in the past five years from $86 million in 2012 to $170 million in 2016. The Asia Pacific region has become a more important region for real estate transactions as fund managers with capital to deploy look to source opportunities in a competitive marketplace.

On one side, larger investors are looking for more control in their investments, leading to an increase in co-investments. On the other end, crowdfunding has opened up investment opportunities to some of the smaller-check investors.

What kinds of firms do you cater to?

Our pricing model is structured to allow for both one- and two-user start-up firms and some of the largest private equity real estate firms in the world to utilise our system. Due to the rapid growth in fund size in the Asia Pacific region, we are seeing a strong demand for our cloud-based platform within multi-office environments in the area, due to the ease of deploying and maintaining our software.

Whether investment managers are in need of fundraising, marketing, compliance, acquisitions, or portfolio management they can leverage Dynamo’s software as a service solution to help manage this rapid growth in fund size. Our team is also seeing growth in the UK and European markets.

Has Dynamo seen an uptake in private real estate firms and real estate investment management groups using the software?

Yes, we have seen a steady increase in both user counts with existing clients and completely new clients across all regions. Many of our clients first roll the platform out in just one department that has the greatest need. When other departments in the firm see the benefits their colleagues have received from leveraging the system, they want in. The multi-phased implementation approach has been very successful.

We also saw an uptake in investment management software use in the UK region after opening a local office, largely due to being physically present and being able to do business eye to eye. With the launch of our Singapore office in early 2017, we expect the same uptake of use in the Asia Pacific region.

What do you see as the main challenges and opportunities for investment managers going forward?

The two biggest challenges we hear about across the board are: keeping up with the increased and ever-changing demand of investor requests, and staying ahead of compliance regulations. Dynamo is dedicated to alleviating investor relations professionals of ad hoc demands by improving the way information and data is exchanged.

Our system also ensures compliance best practices are maintained for current and future mandates, with regular updates accounting for changes to regulations.

Further challenges seen are the competitive fundraising landscape and the uncertainty of Brexit negotiations, which will naturally affect European markets and probably other markets as well.
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