T2 Capital Management began as a small shop making debt and equity investments in commercial real estate. During its early stages, T2’s tight-knit team deftly managed both their acquisitions pipeline and debt investments by communicating via email and tracking deals in Excel. As T2 grew its team, property count, and loan portfolio, they started to experience growing pains, which were difficult to diagnose and resolve due to their diversified portfolio.
On the one hand, their acquisitions cycle faced many of the challenges that teams of all sizes typically face: decentralized task management, timeconsuming reporting, and duplicative spreadsheets. When new properties piqued their interest, an acquisitions team member emailed the investment team with relevant information. Much of the pipeline was simply tracked in spreadsheets, and tasks were generally assigned amongst the team via email. As it grew, T2 knew there must be a better way to manage incoming and outgoing data points.
The lending arm of T2’s business, however, imposed a separate set of challenges entirely.
“Debt and equity investments were both primary drivers for our bottom line, but our internal processes and workflows were very different for the two portfolios,” said John Felker, T2’s Co-Chief Investment Officer. “Due to our independent tracking systems for each business line, it was difficult to understand the big picture without first checking numerous spreadsheets.”
Through its managed debt funds, T2 issues first mortgages and mezzanine financing for third-party borrowers, often with varied credit profiles and time-sensitive needs. Its investment team meets on a weekly basis to review the deal flow and potential investments. The origination team completes underwriting and, ultimately, each transaction is reviewed by the investment committee. Beyond underwriting first mortgages and mezzanine loans, the T2 team is also responsible for generating customized investor reports, a process that became increasingly unscalable.
Unlike standardized pipeline reports, investor reporting involved taking into account which properties they had invested in, their stake, and other unique factors. Some investors held a substantial stake in one property, which required an in-depth analysis detailing how the property was performing. Others had a lower stake across a large loan portfolio, which instead called for a high-level overview of the various investments and aggregated analyses. Their team manually built out every report using Word and Excel.
To simplify reporting and unify transactions across business lines, T2 set out to look for a project management tool. While they considered building their own solution with an open-source tool like Salesforce, they also recognized the trade-offs: cost, development time, and the burden of managing platform updates over time. Other project management tools they considered lacked the industry specificity their nuanced process required. Eventually, they started investigating tools that were purpose-built for commercial real estate, and after completing their search, settled on Dealpath.
“Once we narrowed our search and better understood the deal management category, we decided on Dealpath,” said Aaron Tink, T2’s Portfolio Manager. “There are no true competitors that can do what Dealpath does in the same robust, highly configurable fashion.