FCA’s Findings on Private Market Valuation Practices: How Technology Supports Firms in Meeting Key Recommendations 

The FCA’s recent report on private market valuation practices highlights several areas where firms can improve their processes to enhance governance, transparency, and efficiency. The report underscores the need for improved independence, enhanced oversight, and the adoption of technology to streamline valuation processes.  

Here’s how 73 Strings aligns with these recommendations: 

1. Enhancing Valuation Frequency and Efficiency 

The FCA identified a need for more frequent valuations triggered by market events or asset-specific changes. While some firms expressed concerns about the resource-intensive nature of such valuations, technology offers a solution. 

How 73 Strings Helps: 
Our platform streamlines time intensive manual and error prone tasks such as financial data uploads and market data refreshes, allowing valuation teams to focus on judgment-driven tasks. This enables firms to conduct more frequent valuations efficiently and accurately. 

2. Strengthening Governance and Oversight 

The FCA emphasized the importance of clear accountability, robust oversight, and accurate record-keeping in valuation processes. 

How 73 Strings Helps: 

• Governance Tools: Our valuation workflow solutions ensure accountability by defining clear roles and maintaining a complete audit trail of valuation decisions. 

• Conflict of Interest Management: The platform’s workflows track deviations from valuation policies, ensuring transparency and consistency. 

• User Access Management: Alongside Workflows, our platform helps establish process governance while also providing easy portability among different teams involved in the valuation process, ensuring smooth transitions and maintaining oversight. 

3. Improving Documentation and Reducing Human Error 

The FCA highlighted in its Good Practice guidance that some firms have introduced automated third-party valuation software to improve consistency and reduce the risk of human error in valuation models. The FCA also encouraged firms to consider investing in technology to achieve these improvements. 

How 73 Strings Helps: 

• Our platform aligns with this recommendation by automating valuation processes to enhance consistency and accuracy. By reducing reliance on manual data entry, 73 Strings minimizes the risk of errors and ensures calculations are performed securely within the system. 

• Additionally, for firms conducting valuations quarterly — or monthly for private/infrastructure debt assets — our platform streamlines data collection and refresh processes, reducing operational burden and improving data accuracy. 

• Audit Process and Back Testing: Our platform also supports audit processes and back testing with ease. With just one click, users can review historical data, valuation methodologies, and key assumptions to support audit requirements.  

4. Supporting Investor Transparency 

Transparency remains a key focus for the FCA, with firms encouraged to improve how they communicate valuation insights to stakeholders. 

How 73 Strings Helps: 

• Our system offers a value bridge feature that illustrates valuation changes across different factors and components. 

• Structured valuation reports: including methodologies, nuances, raw financial/market data, and qualitative insights — can be generated with a single click to enhance investor confidence. 

5. Facilitating Ad Hoc Valuations 

The FCA noted that many firms lacked defined processes for conducting ad hoc valuations triggered by market events. 

How 73 Strings Helps: 

• Our platform automates ad hoc valuations with a scheduler that responds to financial data updates or market volatility. Firms can also create valuation versions for comparison during periods of disruption. Additionally, our platform’s simulation analysis capabilities provide valuable insights to support informed decision-making. 

6. Ensuring Comprehensive Record-Keeping 

Poor record-keeping was a key concern in the FCA’s report, hindering confidence in firms’ valuation oversight. 

How 73 Strings Helps: 

• Our system meticulously tracks valuation data, financial uploads, and supporting documents throughout the investment lifecycle. Every adjustment, assumption change, and valuation decision is stored to ensure compliance with FCA’s recommendations. 

7. Mitigating Valuation Risks and Ensuring Compliance 

The FCA highlighted the risk that firms could inappropriately value private assets due to insufficient expertise, lack of focus, or poorly managed conflicts of interest – potentially harming both investors and market integrity. 

How 73 Strings Helps: 

• Our system is structured to ensure no manual calculations are performed by users, reducing the risk of errors. It also provides warning messages to highlight potential deviations from valuation guidelines.  

• Additionally, any manual adjustments made by users are tracked in a comprehensive audit trail to ensure transparency and sufficient support for such changes. 

8. Embracing Multiple Valuation Methodologies 

Firms demonstrating best practices use alternative methodologies to cross-check valuations. 

How 73S Helps: 
Our platform allows users to apply and weigh multiple valuation methodologies, both at the company and instrument level. This ensures firms can run sense checks efficiently, strengthening their valuation governance. 

Conclusion 

The FCA’s report reinforces the importance of improved consistency, reduced human error, and streamlined operational processes. It highlights that some firms are turning to technology as an enabler of Good Practice in valuations. 73 Strings directly addresses these challenges by automating inefficient processes, improving data accuracy, and helping firms meet regulatory expectations efficiently. By leveraging 73 Strings, firms can enhance their valuation practices and deliver greater confidence to investors and stakeholders.