Rising acceptance of AI among alternative investment firms exposes underlying workflow, data and security challenges

Quick Take

• When: February 26, 2026
• Where: Boston, Massachusetts
• Who: Dynamo Software, a global provider of alternative-investment software and intelligence
• What: Release of the 2nd annual Dynamo Frontline Insight Report: Trends, Challenges, and Insights from Leading PE/VC Fund Accountants
• Why: To understand how fund accountants’ technology priorities, pain points and expectations for AI are evolving year over year
• How: A global survey of private equity and venture capital fund accountants conducted in December 2025 and January 2026
• Download: Access the full report: Private Equity and Venture Capital Fund Accountant Survey Findings 2026 | Alternative Investments | Dynamo

The latest Frontline Insight Report from Dynamo Software reveals a fund accounting profession in transition. Even as private equity and venture capital face rising expectations for AI, fund accountants continue to grapple with manual data entry, poorly integrated point solutions and an elevated need for data security within their tech stacks.

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[Figure 1: Do you foresee more reliance on automation and AI in fund accounting?] [Caption: Significant year-over-year growth in the percentage of fund accountants who see AI playing a major role in their profession, according to the Dynamo Frontline Insight Report.]

Automation and AI earn greater mindshare

In 2026, the overwhelming majority (78%) of private equity and venture capital fund accountants expect automation and AI to play a major role in their profession. That’s up from the 61% who said the same last year. What’s more, the group of skeptics who predicted no significant reliance on automation and AI shrunk this year to just 1%.

Expert Commentary: “The accounting industry as a whole is nearing a real threshold, but fund accountants are getting there first,” said Nield Montgomery, managing director of Dynamo’s accounting business unit. “Because of the added complexity of fund accounting, there has been a strong and swift embrace of technology that promises to unlock insights.”

Manual data entry continues to eat up time

Manual data entry and labor-intensive reporting are still cited by respondents as persistent operational headaches.

In 2026, “time-consuming reporting” and “manual data entry and reconciliation” remained the biggest operational pain points with 66% of respondents citing them as top challenges. Results were similar to 2025’s findings in which 64% named “time-consuming reporting” a top challenge, and 61% included “manual data entry and reconciliation” in their list of key pain points.

Expert Commentary: “Accountants’ long-standing challenges with data entry busywork don’t always disappear in the early stages of AI adoption, especially if the software isn’t integrated with other functions or designed specifically for their particular industry,” said Montgomery.

Tech stack integration woes persist, security tops priority list

Nearly half (45%) of fund accountants say a lack of integration across customer relationship management (CRM), fundraising, investor relations (IR) and analytics portals remains one of their top challenges.

Among the reasons integration may be rising in the ranks in terms of prioritization is the similarly rising importance of data security. More than 8 in 10 (82%) respondents said the data security of software they are evaluating is considered extremely important at their firms, up from 78% in last year’s survey.

Poor integration means more logging in and out, more copying and pasting and more manual work. With each data handoff, the workflow becomes both less secure and more prone to errors.

It’s no wonder, then, given the highly sensitive nature of the data that fund accountants must manage, that nearly 75% of respondents said they prefer to work with an all-in-one platform that integrates multiple functions as opposed to a patchwork of point solutions tailored to specific tasks.

Why It Matters

AI is raising expectations for faster, CFO-ready insights from fund accountants. In alternative investments, complex data and fragmented workflows continue to slow delivery and keep too much work manual. Security of the information that flows through multiple, disparate systems becomes even more important against this backdrop.

Take a Deeper Dive into AI Trends

The complete Dynamo Frontline Insight Report focused on fund accounting provides expanded data and insights on:

• Predictions on ESG reporting expectations
• Sentiment around regulatory and compliance impacts to workflows
• Outlooks on which industry trends will gain momentum in 2026

Download the full report:

Private Equity and Venture Capital Fund Accountant Survey Findings 2026 | Alternative Investments | Dynamo

About Dynamo’s Frontline Insight Reports

Published quarterly, Dynamo’s Frontline Insight Reports contain primary research obtained through online surveys of targeted alternative investor audiences. The survey results are contextualized by Dynamo subject matter experts in formal Frontline research reports. To date, Dynamo’s research team has focused on delivering noteworthy insights related to the attitudes, predictions, and strategic plans that Limited Partners (LPs), General Partners (GPs), Hedge Funds, Emerging Managers, and Fund Accountants have on a number of alternative investment topics, including AI in FinTech. To learn more about Dynamo’s research reports, visit the Resource Library or contact media@dynamosoftware.com.

About Dynamo Software, Inc.

Dynamo gives alternatives investors a Performance Edge, empowering them to efficiently scale their firm to capitalize on the growing wave of private market opportunities. With the Dynamo Alternative Investment Platform, Limited and General Partners can now run a tightly integrated firm, putting all their data to work to accelerate operations across front, middle, and back office, unleashing teams to work smarter, and allowing leaders to make better investment decisions and scale their firm. Dynamo has a global footprint with operations across North America, EMEA, APAC, and UAE. For more information, please visit DynamoSoftware.com.

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“Accountants’ long-standing challenges with data entry busywork don’t always disappear in the early stages of AI adoption, especially if the software isn’t integrated with other functions...,” said Nield Montgomery, managing director at Dynamo.