Why Private Markets Need to Move Beyond Excel

For decades, Excel has been the go-to tool for financial modeling. It’s flexible, powerful, and familiar. But when it comes to something as complex (and high-stakes) as private markets allocation calculations, Excel starts showing cracks.

One wrong formula, one undocumented change, or one missing audit trail can translate into millions in lost value, damaged trust with investors, and massive compliance headaches.

That’s why at qashqade, we’re not just replacing Excel. We’re continuously rethinking the entire process of allocation calculations. To understand what that means, we sat down with Gregor Kreuzer, Chief Product Officer, to discuss the risks of relying on spreadsheets, and how qashqade offers a safer, scalable, and purpose-built alternative.

Gregor, let’s start with the basics. What are the main limitations of using Excel for private markets allocation calculations?

The problem isn’t that Excel is “bad.” The problem is that it can do everything. That flexibility means every firm must rebuild models from scratch, every time, without any guardrails.

This leads to several risks:

• Hidden human error: Even a one-character mistake, for example using IRR instead of XIRR, can cost millions without anyone noticing.
• No separation of data and logic: When data structures change, the entire model must be rebuilt, which creates unnecessary work and more room for mistakes. It’s like needing to build an entirely new house just because you want to add a second floor, instead of simply building on top of what’s already there.
• False transparency: People think they “see everything” in Excel, but in models, nobody truly understands the whole logic anymore.
• No security features: no access management in excel
• Scalability issues: Larger files take hours to run and become unusable, while creating more complexity instead of less.

Excel worked 20 years ago when there were no alternatives. But today, continuing to use it adds cost, risk, and inefficiency.

How does an Excel-based waterfall model compare structurally to one built in qashqade?

In Excel, data and logic are intertwined. That means if your data changes, your logic needs to change too. In qashqade, we separate those layers so your logic stays stable while your data flows through it.

The other difference is reusability. In Excel, every model is a new build. In qashqade, once you’ve set up steps like an IRR hurdle or catch-up, you can reuse them again and again.

On top qashqade has built-in validations. Excel accepts any formula, no matter how nonsensical. Our platform knows what a waterfall is supposed to look like and will flag inconsistencies.

You’ve said qashqade doesn’t just replace Excel, it rethinks the process. What does that mean?

A waterfall is, by definition, a step-by-step process. But Excel forces you into rows and columns, which is not how waterfalls work in practice.

We’ve built qashqade to follow the actual economics written in LPAs. That means every carry, return of capital, and hurdle is calculated in the correct sequence. It forces diligence, reduces the risk of shortcuts, and ensures the outcome matches the contract.

Yes, it requires more discipline upfront. But it dramatically lowers risk in the long run.

Can you give us a real-world example of how a small Excel error led to a big mistake?

Absolutely. We saw a case where a fund used the IRR formula instead of the XIRR formula. The difference seems tiny, just one letter. But because cashflows were distributed on specific dates, the IRR formula was wrong.

The result? The GP accumulated much more interest than they should have, and LPs ended up paying millions extra. That was hidden inside a single complex formula.

That’s the danger with spreadsheets: you don’t even know you’ve made a mistake until it’s too late.

What about control? What’s the cost of not knowing who changed what, when, and why?

Operational excellence depends on trust, and trust depends on control.

In Excel, you can’t reconstruct last quarter’s results with certainty. Was it the right version? Did someone change a formula? Was something deleted? It’s impossible to prove.

With qashqade, every change is traceable, every result reproducible. That builds the kind of trust auditors, LPs, and CFOs in general need.

What happens when firms try to scale waterfall models in Excel?

Excel “scales” by multiplying spreadsheets. That means more tabs, more links, more hidden errors. Complexity balloons, and every small LP request can take days or weeks.

qashqade scales the opposite way. The more you use it, the simpler it gets. Reusable components, consistent structures, and automation mean scaling reduces effort instead of multiplying it.

Some tools look modern but are still built on Excel logic. What’s the danger there?

If the engine behind the tool is still Excel, you’re still coding formulas yourself and therefore still carrying the risk.

At qashqade, we’ve built everything from scratch. The algorithms are part of the product, tested across thousands of used cases. Clients don’t have to reinvent formulas or hope they didn’t make a mistake. That’s a huge difference in accountability.

It’s 2025. Why are firms still using Excel for waterfalls?

Familiarity. Teams have built confidence in Excel over decades. There’s also fear of change; moving beyond spreadsheets requires not just software, but a new mindset and operating model.

But the real cost of staying with Excel is hidden: inefficiency, risk, and missed opportunities to build investor trust. The industry has moved forward. Sticking with Excel means staying stuck in the past.

Excel was a game-changer in its time. But when millions of dollars and reputations are on the line, “good enough” isn’t fit for purpose anymore.

With qashqade, firms don’t just model waterfalls. They scale, control and trust all allocation calculations. And that’s the real difference.