What is operational due diligence?
Operational due diligence (ODD) is an allocator's review of a fund manager's operations, controls and service providers before it commits client money and again every two or three years: who administers the fund, holds the assets, values the hard-to-value positions and audits the books, and whether the policies match what the manager says. Operational Due Diligence gives the ODD team seven agents that read the data room in any language, draw the operating structure, check every claim against an independent source and draft a cited ODD report. The analyst works with them in a conversation beside the work, asking why and opening each source, approves every confirmation, and submits a Pass, Conditional or Fail rating that the Head of ODD signs.
How is hedge fund operational due diligence different from private equity?
Hedge fund operational due diligence and operational due diligence in private equity follow the same method with different questionnaires and structures: the AIMA DDQ for hedge funds, the ILPA DDQ for private equity managers. In the working solution the review program covers hedge fund, private equity, private credit, infrastructure and real asset managers, and the questionnaire templates are AIMA, ILPA and the firm's own operational due diligence questionnaire.
What does an operational due diligence report include?
The report the agents draft has five sections: a summary with the rating, the structure with what each entity was checked against, the findings with their conditions precedent to funding, the observations and the sign-off, followed by a sources index. Every sentence is cited; the Review agent checks each citation before the analyst submits, and the report is final only once the Head of ODD signs.
How does it verify a fund's administrator and other service providers?
Service provider due diligence, fund administrator due diligence included, is where the independent checking happens. For the administrator and every other provider, the Verifier agent checks each claim against sources the manager does not control: Form ADV Part 1A Schedule D, the audited financial statements' notes, the regulators' registers and the provider's own controls report. It drafts a confirmation request to each provider with the contact from the regulator's register, the analyst approves it before it is sent, and the reply is reconciled to the claims.
Can it read documents in French, German and other languages?
Yes. The Intake agent reads every document in its own language, with OCR for scans. In the demo it read 38 documents, 31 in English, 4 in French and 3 in German, and every source opens with the original beside the English, so a contradiction in a French audit note can be read against the English DDQ.
Do people stay in control of the rating and the funding?
Yes. The agents propose and never contact a provider, sign a rating, open a review or release money. The analyst approves every confirmation, accepts, edits or rejects each drafted finding with a reason and submits the rating; the Head of ODD signs it; the investment committee decides the investment without being able to change the rating; and Fund Operations and the COO clear each condition before the subscription is released.
Does it watch managers after they are approved?
Yes. The Monitoring agent watches approved managers through Form ADV amendments, audited financials, registers, controls reports, manager letters and news, and proposes re-reviews with their source. When one provider changes or its controls report is qualified, it shows every approved manager that uses it. Only the Head of ODD opens or dismisses a re-review.
How long does it take to go live?
The Agentic Solution Engine builds and deploys it from your requirements and documents: your ODD standards, rating framework, questionnaires and a sample of past signed reviews. It goes live once every quality gate has passed, including a test of the agents against your past reviews. We will walk you through it on your own managers first.