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U.S. family offices hold 54% of their portfolios in alternative assets, according to the UBS Global Family Office Report 2025. The software serving those offices is under pressure to show how private holdings compare to their peers. For CTOs and CPOs, that raises a practical question: build a private fund performance database in-house, or integrate one through an API?
In this article, we’ll break down what building a benchmarking database actually involves, how an API-based approach divides the work, and the seven questions technology leaders should ask before choosing a data partner.
What Building It Yourself Requires
A private fund benchmarking feature looks simple: collect returns, group them, calculate medians. In practice, it requires a standing data operation:
- Data collection: Sourcing returns across managers, reporting periods and sources. Cost: years of research before launch.
- Standardization: Reconciling IRR, TVPI, DPI and RVPI across dates and methodologies. Cost: constant data engineering.
- Fund classification: Tagging every fund by asset class, strategy, vintage and sector. Cost: dedicated research headcount.
- Benchmark construction: Defining peer group rules, minimum sample sizes and quartile methodology. Cost: specialist analytics talent.
- Maintenance: Updating valuations every quarter as funds mature. Cost: indefinite.
For a company whose core product is portfolio accounting or advisor technology, every item on that list competes with the roadmap.
How an API Divides the Work
An API-based model splits responsibilities cleanly:
- The data provider maintains performance records, fund classifications and benchmark calculations.
- The software platform controls the interface, workflows, permissions and customer relationship.
Here’s how a single request works. A user opens a 2020 vintage buyout fund with a 15.2% net IRR and a 1.8x TVPI. The platform sends the fund’s asset class, strategy, vintage and metrics to the benchmarking API. The API identifies the peer group and returns:
- Peer median IRR and TVPI
- Relative performance
- Quartile or percentile rank
- Peer group sample size
- Methodology details
The platform displays the results in its own reports. The user stays in your product, and you never touch the underlying data operation.
Evaluating a benchmarking API? Dakota’s benchmark data covers 18,000+ private funds, with technical onboarding for your engineering team. Explore Benchmarking Partnerships →
Five Advantages of the API Approach
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Faster launch. Engineering effort goes into integration and user experience, not data acquisition.
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Simpler architecture. Your team still owns security, permissions and performance, but not a private markets data pipeline.
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One data service, many products. The same integration can feed client reports, a family office dashboard and a manager research workflow.
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Easier expansion. Start with private equity benchmarks and add private credit and real estate without rebuilding.
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A revenue path. Benchmarking can be packaged as a premium module.
Seven Questions to Ask a Benchmarking API Partner
Not every data provider offers the same coverage or integration support. Before signing, technology leaders should ask:
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Coverage: How many funds have performance data? Which asset classes, strategies and vintages?
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Methodology: How are peer groups built? What minimum sample size does a benchmark need?
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Data quality: Who validates the records, and how often are they updated?
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Integration: What endpoints, authentication methods and documentation are available?
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Reliability: What service levels, response times and support come with the contract?
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Commercial rights: Can results appear in client-facing reports, premium modules or white-label products?
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Roadmap: Will the provider add asset classes and capabilities as your platform grows?
The answers to questions 2 and 6 matter most. A benchmark your users can’t trust, or can’t show to clients, doesn’t help your product.
Build vs. Buy Is a Strategy Decision
The question isn’t only cost. It’s where your company creates value. Wealth tech platforms win on accounting accuracy, integrations, reporting and user experience. Private markets data providers win on collection, classification and analysis. Partnering lets each side do what it does best.
Build on Dakota Data
Dakota’s research team maintains performance data on 18,000+ private funds, with net IRR, TVPI, DPI, RVPI and PME. API partners get:
Benchmarks by asset class, strategy, vintage, geography, fund size and sector
Sample data and API documentation for your engineering team
Delivery through API, embedded Peer Group Builder or dataset license
Talk to Our Partnerships Team →
