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“PEF helped us along and made sure that we never had any issues when it came to regulatory matters.”
Colin Eckersley, Senior Accountant, CRG

Client Background

Since 2003, CRG has supported innovation in the healthcare industry by serving the growth capital needs of its business partners across the globe. The firm targets investments between $20 and $300 million in public and private commercial-stage healthcare companies specializing in next-generation products, technologies, and services. With approximately $2 billion under management, CRG benefits from a global network of industry specialists and a world-class investment portfolio that spans the healthcare ecosystem.

Situation

Administering a fund is never easy, but CRG’s investments posed greater accounting and reporting challenges than most. To begin with, they focus on opportunities in healthcare, which is a heavily regulated industry. In addition, the firm has some investments that are run through complex structures designed to accommodate different step-downs or maximize tax advantages for their Limited Partners. And because their investments include Small Business Investment Companies (SBICs), CRG also needs to meet rigorous Small Business Association (SBA) reporting standards. This complex combination of requirements was putting increasing pressure on the firm’s small back office.

“At that time, there were only two members of the accounting team,” said Colin Eckersley, Senior Accountant at CRG. “Between all investment vehicles, they were putting out approximately nine different financial statements.”

Solution

Recognizing that the complexity of their investment strategy would require senior-level expertise in very specific accounting and regulatory areas, CRG decided on an outsourced administration solution. On the recommendation of their legal counsel, CRG engaged PEF to manage their fund accounting and reporting, a transition that Eckersley said was seamless.

“We were able to give PEF all of our in-house data and just kind of pass it off to them. And they would come back with either the completed books or really good questions.”

CRG also has direct access to PEF’s specialists so that they can consult with them at any time on regulatory and administrative issues that could impact investment decisions or investor relations.

Results

Having PEF on board has enabled CRG to manage the accounting and reporting complexity of their investments while continuing to embrace rapid growth. With PEF handling fund administration, the process moves far more swiftly and CRG’s in-house team can stay ahead of the challenges.

Being able to tap into PEF’s expertise also means that CRG can plan investment strategies with confidence. PEF’s input helps the firm evaluate funding opportunities from a regulatory perspective before moving ahead.

“If we’re looking at a funding opportunity, we can just call up PEF and say, ‘Hey, this is what we’re looking at doing. Does this work?,” said Eckersley. “They help us along and make sure that we never have any issues when it comes to regulatory matters. It’s really good to have somebody with a strong knowledge base to make sure everything is moving where we need it to go.”

For CRG, gaining access to responsive and reliable advice and administrative support has been crucial in managing the firm’s rapid growth.

“When I got here, we had two funds totaling just over $1 billion,” said Eckersley, who joined the company in 2014. “Today, we are looking to close our third fund, which is a little over $1.25 billion. So we’ve basically doubled our asset size in two years.”

As the firm looks ahead to more growth in the future and the potential launch of a second SBIC fund, they plan to rely on PEF to continue providing them with fund administration and guidance.

“We really appreciate the relationship that we have with them,” Eckersley said. “If we have any issues, we can call them up and they’ll get right on it and solve the problem.”

 

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