Rochelle is responsible for enabling go-to-market and growth strategies across sales, marketing, product, and client engagement. Before taking on this role, Rochelle was a Senior Pre-Sales Consultant, engaging with clients and prospects across the financial services industry. Prior to joining Arcesium, Rochelle spent over five years at BlackRock Aladdin servicing institutional asset managers and leading several implementation projects across North and South America. She graduated from Vanderbilt University with a degree in economics.
In the Superman/DC Comics universe, kryptonite can strip the superhero of his superior strength and abilities. Ironically, kryptonite comes from Superman’s home planet. He is almost helpless when confronted with the remnants of that world.
Private credit managers have a comparable form of kryptonite: Excel. Excel is often the origin of their data discipline. The use of Excel is ubiquitous across the financial industry, and private credit is no exception.
However, the surge of private credit creates a new world for managers. The bespoke nature of private credit transactions creates ugly consequences that can leave users weakened and helpless, such as:
Valuations misalign when files are out of sync with one another.
Covenant breaches slip past surveillance that depends on brittle formulas hidden in workbooks.
Generating reports for regulators and stakeholders becomes a massive energy and time sink as teams manually re-key inputs from PDF financials, agent notices, and bespoke term sheets.
Version forks develop when no one agrees on which file contains the single source of truth about a particular dataset.
Missing lineage occurs when inputs and assumptions lack auditable paper trails.
Latency develops when updating borrower or collateral data takes days or weeks.
In other words, Excel blocks the superpowers firms would have in a world of unified data.
The real problem with Excel
Part of the problem with Excel is that it works so well for individuals. At the individual level, Excel spreadsheets accelerate analysis. Their usefulness causes spreadsheets to be copied, tweaked, and saved in different versions.
The downside comes from the lack of controls or governance to enforce consistency and prevent errors. In aggregate, widespread and uncontrolled individual usage within a firm undermines auditability, slows decision-making, and creates operational risk.
Unlike kryptonite, most users want to keep Excel. Rather than replacing or banning it outright, firms should impose light controls governing its use. A staged transition makes the most sense. For example, recurring formulas can move to shared calculators within a unified data ecosystem designed to handle the bulk of today’s Excel data. Unified data environments with open architecture can still use Excel as an end-user interface, with proper data management in the back end.
At the firm level, careful planning can identify where and how to extend or replace Excel with unified tools and data sources. Such a transition should consider the following steps:
Map and rank spreadsheet usage by criticality: Not all Excel workbooks are created equal. Some are more operationally significant than others. Creating a ranked spreadsheet inventory will reveal files where inconsistent or broken formulas can cascade into financial misstatements. A ranked inventory will also expose high-volume files where repetitive manual data entry generates errors and bottlenecks.
Impose containment on high-impact files: The riskier or more impactful the spreadsheet, the more controls should be put in place to regulate access and preserve file integrity. Containment buys time for data unification and mitigates the adverse effects of overreliance on Excel. Interim safeguards include:
Imposing access controls to reduce or eliminate uncontrolled copies.
Implementing light regression testing to validate critical formulas.
Inputting hard-coded outputs to preserve the integrity of calculations across reporting cycles.
Migrate calculations into shared services: Spreadsheet flexibility is wasted on standard firm-level private credit calculations (such as accruals, covenant checks, coverage tests, or waterfalls, for example) because contractual definitions govern them. The proper place for these formulas is not an Excel workbook run by individual staff members, but a unified data ecosystem, preferably in shared microservices that can return standard outputs.
Move key formulas into unified data ecosystem: Repeatable logic can be extracted from Excel spreadsheets and codified into services attached to the unified data ecosystem. Calculation lineages then become auditable while changes to definitions propagate across portfolios instantly. Analysts can stop authoring spreadsheets and start consuming data products, improving performance in their core function.
Standardize reporting: Investor, risk, and regulatory reporting often suffer from inconsistencies due to different assumptions and data sources across workbooks. Standardizing reporting from a unified data ecosystem ensures that every pack originates from the same source, dramatically reducing reworking at quarter-end and strengthening institutional credibility during investor and regulator engagements.
Compounding unified data superpowers
Containing the kryptonite effect of Excel on private credit management takes away its harmful effects and creates new abilities:
Greater data centralization creates scaling efficiencies.
Fewer manual touchpoints accelerate cycle times and reduce human error.
Consistent covenant surveillance minimizes the risk of unnoticed breaches.
Faster investor and regulator reporting, with standardized packs produced from governed sources.
Greater resilience when key personnel rotate or depart since institutional knowledge lives in governed services instead of private files.
Audit clarity and transparency through data lineage and traceable calculation governance.
Greater high-value productivity as teams redirect energy from spreadsheet management to analysis.
The right tool for the right job
To be clear, a successful transition to unified data does not have to relegate Excel to a shielded vault. Instead, it can return Excel to its proper place as a flexible sandbox that enables rather than weakens or undermines.
In the long run, gaining reputational advantage with investors and regulators is the real prize. Firms powered by unified data produce robust audit trails quickly and scale their operations smoothly. Meanwhile, firms without unified data struggle with even modest increases in deal volume and fall short of investor expectations and regulatory requirements.
Firms that successfully execute the post-Excel transition remove internal limits to scaling up to match the surging demand for private credit. Firms that continue to depend too much on Excel will continue to suffer from the quarter-end scramble four times a year and endure the discomfort of taking weeks instead of days to answer investor questions.
Just as Superman learned to neutralize kryptonite's effects while harnessing his true powers, private credit managers must contain Excel's weakening influence to unlock the superpowers that unified data provides.
Assessing Excel risk exposure: 5 questions for COOs and CTOs
Here are five questions COOs and CTOs should ask themselves about their Excel risk exposure and how they plan to mitigate it:
1. Have we identified which spreadsheets pose the highest operational risk?
2. What controls and safeguards are currently in place to prevent spreadsheet errors, version forks, and data inconsistencies, and can these be improved?
3. How standardized and consistent are our investor, risk, and regulatory reporting processes?
4. How many personnel hours do we spend reconciling conflicting datapoints from multiple spreadsheets?
5. What structural, systematic, or long-term solutions are we considering for the above problems?
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