Preferred Return Podcast

OnboardingBridge: Bridging the Gaps of Investor Onboarding


Welcome back to Altvia’s Preferred Return Podcast! Following the launch of OnboardingBridge, Tim Flannery, co-founder and CEO of Passthrough, returns to discuss investor onboarding integrations with private equity CRMs, AI’s use in sourcing lookalike investors, and the new SEC regulations.

This is a must-listen episode introduces, OnboardingBridge, the first solution to fully integrate a CRM with an investor onboarding solution — leveraging the power of Passthrough and Altvia combined.


Welcome back to Altvia’s Preferred Return Podcast! Following the launch of OnboardingBridge, Tim Flannery, co-founder and CEO of Passthrough, returns to discuss investor onboarding integrations with private equity CRMs, AI’s use in sourcing lookalike investors, and the new SEC regulations.

This is a must-listen episode introduces, OnboardingBridge, the first solution to fully integrate a CRM with an investor onboarding solution — leveraging the power of Passthrough and Altvia combined.


Jeff Williams: Tim Flannery, welcome back, man. You are, as far as I know, the, the first return guest, hopefully of many. And I realize right as I say that it’s a bad look that I don’t like, have something to tell you about— you know, it was like this reward for that. But I appreciate you coming back on, man.

Tim Flannery: That’s okay. I’ll put this on my lifetime accomplishments. Thanks for having me on.

Jeff Williams: 2x Preferred Return Guest, the only one. Big news yesterday, man, we introduced OnboardingBridge, and for any of the listeners that don’t, you know, automatically connect the dots here. The first time you were on Preferred Return was God— probably about two years or so ago. Right?

Tim Flannery: Yep. Yep.

Jeff Williams: I think it was early days. It was earlier days than I think I understood at the times, but I now know of Passthrough. But , you know, I think the magic you had reached out, , we got to know each other a little bit and I was obsessed with the idea of— you know, investor onboarding and here we are now two years later or so, and a day removed from Altvia having announced OnboardingBridge, which is the formal launch of our integration with Passthrough. We’ll talk all, all about that, but pretty exciting man.

Tim Flannery: Yeah, it’s pretty crazy that, the first time we spoke, it was my two co-founders and I, with a dream of making it easy for investors to invest. And we knew that it was gonna be a part of a broader way for making it easier to manage investors outside of just things on Passthrough. But with OnboardingBridge, it’s great to see it realized in our partnership with Altvia.

Jeff Williams: I think that, , for the most part, what OnboardingBridge does, what it looks like and stuff is in large part, kind of how I imagined it would be two years or so ago. But it’s totally different to see it, and of course we’re talking about it in a medium that you can’t see right now on a podcast. So I’ll just go ahead and fill in a few gaps here.

The basic gist is that Altvia CRM — AIM — now has the capability of pre-populating certain parts of the sub doc with information you already have in your CRM that’s heavily requested by, , customers of ours. Also allows the IR user, if you will, to sort of kick off, , you know, the sub doc process, right?

So like we’ve done a lot of talking about this over the two years. They’re the IR users working this person through their pipeline. And then this sort of sub doc process creates its own, you know, kind of pipeline. The closing process, and you’ve heard me refer to it now a million times so sorry for one more, as the pipeline in the pipeline at the bottom of the pipeline. 

But the IR user now is taking them through that pipeline, and can now kick that off, maintain the visibility of kind of what’s going on. I was thinking a lot about this just by total kind of happenstance the other day. There probably aren’t necessarily a lot of Passthrough users that are IR folks or a lot of kind of kicking that process off, but like for not really any good reason, right?

It’s like the actual button click sends an email to somebody, right? It could be like this super scary thing and lawyers are like, “Well, you know, we gotta…” But I mean, obviously. This is all planned. You know that the sub docs are all onboarded with Passthrough. Everything’s good to go. Lawyers have signed off.

IR users now can push that button and maintain the visibility of what, you know, what’s going on in that little pipeline. So the pipeline is now closing.

Tim Flannery: Yeah. Well, I mean, this is a process that’s existed without technology to support this last mile piece for a while, right? And so, the past state of the world is you had the groups of people that were using Altvia as an investor portal. Were using it as a data room. Were using it as a CRM to manage all these relationships. And that’s the way that it was two years ago when we first met. And, we also had a group of people that needed to go coordinate around how do I actually handle this problem of, yes, somebody’s coming into the fund, but now I actually have signed docents. I’ve got completed compliance, I’ve got all these different things to actually admit them as an investor. 

And so these two processes were happening, but by— actually with— OnboardingBridge and being able to connect Passthrough and Altvia together, we’ve been able to get the pieces to talk to each other. And so it means greater fidelity of data. It means faster time to close. And I think what everybody’s pretty familiar with today is time to close matters. Because the longer you keep your raise open, the longer that you keep an LP in the wind. Anything can happen, anything can happen. 

And so not only does it give you greater clarity and insight in what’s going on with your pipeline, but it also gives you a greater ability to go close it. And so it, it’s— these things have always existed. How do I actually go get somebody to go sign sub docs? How do I manage the relationship that I have with all of my investors? The simple act of connecting these two means that all of the different teams are all looking at the same set of information, whether they’re looking at it in Passthrough, or they’re looking at it in Altvia so that, okay, let’s just close quicker and let’s get back to the job.

Jeff Williams: Yeah. Yeah. You know, it’s fascinating. We literally launched OnboardingBridge yesterday, and as I sit here, you know, , today, the day after, I actually like, inundated with all these new thoughts about it, you know, and, and many of them are not necessarily like . , you know, things that haven’t been thought before, but new angles of it or like new questions I have, and probably more importantly, new possibilities that I’m already sort of imagining.

Like as you were talking there, I was thinking about how it’s probably the case that like when the sort of close is centrally managed via Passthrough by lawyers there. I know the features Passthrough has for interacting with the LP user are tremendous, right? It’s sort of like, “Hey, you answered this question wrong. Could you revisit it?” I think all that stuff’s awesome, but there’s probably still a lot of times where the, let’s say that sort of lawyer, user lawyer persona of Passthrough might go to the relationship manager. To ask them to communicate something maybe with the LP or, maybe not necessarily directly, but they have questions of the sort of IR capital raiser sort of relationship manager user that are, that, that. Maybe sort of cut out just a little bit here, right? Where it’s kind of like the IR user now not only has the visibility, but also has the ability to just sort of shortcut that and be like, yeah, yeah, no, like I’m actually now sort of, kind of holding your hand a little bit through, through some of the closing process anyway.

Interesting that now at the morning after having launched, all these things are coming. I think that’s good. I think we’ll, We’re bound to come up with some interesting stuff, and it is just the start on that note, right? We do have, some other things planned and, we aren’t in a public company, but, and I won’t give a safe harbor statement, but we aren’t gonna get too much into those things just yet.

Let’s talk, I want to just hear a little bit more here and for our listeners, what, what’s going on at Passthrough you guys have grown a ton since we last talked on the podcast.

Tim Flannery: Yeah, so let’s see. When we spoke about two years ago, the product had been in market for a little bit over a year, and really the first year in change was just bootstrapped with my partners. I joined in May and then we really quickly grew from— we had around 10, 15 customers at the time. Around the time when we actually had talked, we probably had closer to 30 and we quickly grew it after that. 

Today we’ve got nearly 400 fund managers as clients, and those clients look like. You know, your a hundred million dollars venture fund to your $300 billion global asset managers and, and everybody in between. And our vision from the very beginning was that we wanted to do one thing and do it incredibly well. And, that was investor onboarding. Be a technology solution that allows you to solve some of the things that you highlighted earlier really tricky coordination challenges for how do you actually get IR and front office and fund admin and legal and everybody coordinated around this, this one thing. And we knew that it would happen on Passthrough, but we also knew that it existed outside of Passthrough. 

So clearly from then till now, we’ve made a major investment into our API capabilities. So how can we actually exchange information? How can we change together events? How can we surface statuses back and forth? And that’s the thing that underlays, what we’re doing with OnboardingBridge. There’s a lot that we’ve also built around how Passthrough’s embeddable, how we can automate all of these different things and make it simple so that people can lessen the amount of coordination work that they need to do because it’s just bound by software. 

And so we’ve grown that business tremendously. And then a little under a year ago, we actually launched our second offering, which is available as a part of our investor onboarding electric— electronic sub doc tool, but also available as a standalone. And that is Know Your Customer and Anti-Money Laundering. And so, , originally actually our, our first, our first, iteration of it was a self-service tool. And so what we would do there, there’s a similar problem in KYC/AML is there is to, sub docs of coordination of going back and forth iteratively to get the right answers because there’s not enough known information upfront. And so tends to fall more on the fund admin than it does on legal. But still, I as an investor and serve a list of KYC/AML requirements. And I provide information about my trust and I send over a bunch of different docents and the team’s gonna come back and say, well, thanks for telling me about your five beneficial owners now, giving me information about all five of them. And we just keep going back and forth and back and forth and, it takes me forever as an LP. It’s a nightmare of an experience. I have to do this every single time that I invest with a new manager. 

And we’re seeing, by the way, KYC/AML requirements are just getting more and more stringent. The SEC actually just issued a risk alert to broker dealers about a week or two ago, and there’s just gonna be more focus on this. It— it’s not getting easier, so really difficult for the investors, but then it’s difficult for people to actually review everything. Then ultimately review sanctions, matches, review politically exposed person matches, determine whether or not this investor’s appropriate for our fund. Is this the level of risk that we wanna be able to take on? 

So initially we launched a self-service offering, and then we launched a full service offering because it turned out even if you were talking to those many, many, many billions of dollars global asset managers, or you were talking to that small venture fund or real estate fund— nobody wants to do the work. So we actually launched a full service offering. People don’t want this in-house. It’s not core to the way that they make money. It’s not core to anything that they’re doing as a firm. And so we’ll actually review the matches, we’ll review the underlying information and provide a recommendation that was, that was built in large part with our, , our partner. Our partner is Julius, who’s our Chief Legal and Compliance Officer. He is the Chief Compliance Officer, JP Morgan. Goldman Sachs, MUFG. He is the head of the SEC Bank, Examination Division. And then also, our PM Justin, he helped build up Blackstone’s AML program, and so we just have a really deep bench on this. But it’s taking a similar set of information that we’ve had from the sub doc process. It’s a pending new information. Then it’s just repurposing it. And so that’s our really key thing is how can we take this investor information, which is kinda like this golden key, and use it to unlock different things for these investors in their transactions. And so, yes, an investor can take information that sits in Altvia and use it in a prefilled manner to go invest in their first fund on Passthrough.

Second time they come and Passthrough. They have the information from Altvia on there. They also have all of their information that they’ve had from their previous investments. They can then reuse that across any fund manager that they want. That extends beyond sub docs into KYC/AML. And really the goal is how can we just shrink this transaction time, which in the private markets is days or weeks or, or longer to just minutes. And so if we can do that, that means that all of these people that actually want to invest into the privates, well it turns out the reason that they can’t is many of them from regulatory to whatever. But there’s demand on both sides of the market. And without the kind of technology and interactions that. , that we’re building and, and frankly, that we’re facilitating together with Altvia and Passthrough, it’s not going to be possible. And so this is the infrastructure that the markets need to evolve to where they need to get to, because right now they’re just not ready for it.

Jeff Williams: Yeah. It’s amazing. It’s a lot. One of the things that occurred to me while you were saying that is that since the last time we spoke, Russia invaded Ukraine and the world proceeded to sanction a whole bunch of Russian Bureaucrats. And then also, the markets generally are in a pretty different place than they were two years ago, including having had many regional bank failures.

They’re well talked about. So it feels like the relevance and the importance of all of what you were just talking about where, where Passthrough has made big strides is, I don’t even know that I, that I had considered how, how relevant that that stuff is against the timeline, but it’s pretty significant.

Tim Flannery: Yeah, it definitely pushed us forward on KYC perhaps a little bit earlier than we wanted. We got pulled into it by a number of banks. One of the, one of the challenges with the, the, we see a lot in fund formation. Whether it’s sub docs, whether it is, the compliance aspect of it is there’s no one size fits all solutions.

There’s no standard for how you do KYC/AML there. There’s a set of guidelines for what you’re supposed to do, but there’s no standard on it. There’s no standard for what a sub doc should look like within a given firm, let alone within a jurisdiction. 

And so what we do is we need to make sure that there’s custom processes to be able to go meet whatever people’s requirements are. but then we’re standardizing all the information on the backend so that we can make it interoperable because this is not a world where there is a standard that’s going to emerge. This isn’t, I’m not the IRS telling everybody that you need to fill out a W-8 or W-9. That authority doesn’t exist on this market, and I just don’t see it on the horizon. 

And so when you consider how complex the world is today, do you think it’s gonna simplify or do you think it’s gonna get more complex? It’s only gonna get more complex and so be it KYC, be it the. I mean, the SEC is finalizing comment on what to do for venture firms right now on how private funds should be regulated. The world’s only gonna get more complex, and so you’re going to need these kinds of tools to be able to go solve these problems for you because it’s not getting easier. And how can you really solve with the headcount?

Jeff Williams: Yeah. Well, and I think that, you know, one of the things that’s super key to OnboardingBridge, as you say that, is that like we don’t, you know, we aren’t— A lot of this complexity is implied and it’s sort of inherent, and I’m aware of it. We also don’t get into this level that you do because it’s like somebody else’s problem, right?

I mean in this case, it’s like the lawyers and the compliance folks from the GP or it’s your problem to solve and all that stuff, but it becomes our problem for our customers when they need that information. Right. So like, and I’ve described this to you and to many people many times, and again, it’s this visual thing in a sort of audio format, but this sort of cycle of the information, right?

It’s like a traditional circle, you get the information from the LP when they come into your fund. You know, you check it, all that, you reconcile it, and then a lot. So a lot of that information now is relevant to the ongoing management of that relationship for 7 to 20 years. Until you come back around and 1, 2, 3 years later and it’s time to do it all over again.

And you know, certain things have changed now for us, like being focused on managing the relationship with LPs, obviously to your point, you have to know the investing entities and you have to know that they’re not on sanction list and all those sorts of things. So, you know, that’s somebody else’s problem.

Passthrough’s solving that problem, it’s a lawyer problem, all that stuff. What our users need is like, okay, well how are we going to, you know, communicate with these folks? We, Altvia, provides a suite of tools that helps you manage that relationship by automating some of the communications, the issuance of capital calls, distribution notices, delivery of all sorts of docents, delivery of data and side of a portal, all that relationship management stuff.

Knowing who to send the capital call out to is oftentimes like something that’s asked for, you know, in the sub doc. So you get that and then it starts changing and all that stuff over, you know, years. Like maybe some people at these institutions leave and others take their spot, so you need to add them to start receiving, you know, quarterly reports and things like that.

But then like a year or two later comes around and it’s time to raise again and knowing, you know, who the entities, who the relationships are to be talking to in terms of people. And then, starting the closing process again. That’s this circle right now. You’re right back. But, but the thing that’s kind of shifting all throughout that cycle is the information and, and it’s a little partitioned inherently because of the sort of groups of folks here.

OnboardingBridge brings that together into a single place, makes it, you know, easy for the relationship managers to have it, to reuse it, to have visibility, stuff like that. But yeah, I mean, I guess the other major thing that I’m sort of thinking about here in that lifecycle is the other part, excuse me, of Passthrough’s vision, which I’ve been fascinated all along.

You guys also on your own, by yourselves, make information reusable across. Sub docs by investing entities. And so that to be super clear, is like if I am the head of, you know, a family office and I’m the one that fills out the sub docs, I fill them out on Passthrough for, ’cause I’m committing to so-and-so GP and then, which is a Passthrough customer, do that on Passthrough and then I come and, you know, I don’t know it, but turns out some other GP that we’re committing to also uses Passthrough.

And now I, I actually can, can reuse a lot of — that sort of very detailed stuff about the investing entity. , and I don’t have to necessarily go back and fill that out. So that’s a huge benefit to the user. Obviously it’s a huge benefit to the GP. It’s a huge benefit to maintaining like the sort of data integrity throughout this cycle that I’m talking about.

And I think that while it’s a practical feature and it’s helpful and all that, the vision behind it is also one that I’m fascinated by.

Tim Flannery: I think there’s a couple things happening. So let’s start on the investor who actually comes into multiple funds. And so we touched on this a little bit earlier. There’s no standard for what a sub doc should look like. There’s no standard for how a question should be asked. And so one of the things that you pay your lawyer to do is to help you understand, your fund its risks in relation to the current regulations in your industry. And so they’ve written out a subscription docent, they’ve written out all the other governing docents of your firm, of your fund, and it’s based on their interpretation of it and their interpretation. 

Everybody’s look, their interpretation is gonna be a little bit different from somebody else’s interpretation. But it’s all got the same rules because it’s all got the same rules. Everybody’s looking for the same answers, but there’s different ways that they want to cover it. And so the first fund manager that you invest in asks you a question like, what’s the investor’s name? All right, great, easy. Second fund manager that you invest in says, what’s the subscriber’s name? They just use different terminology. There’s different answers that they’re trying to get to at the bottom of this. And so yes, you can help investors reuse information when the same questions are asked. That’s really easy. The tricky thing that we’re solving is how do you help investors reuse information when there’s different questions that are being asked? 

And so when I talked earlier about like our golden key, the thing that really matters to us is this investor identity information. We can help tag all these different answers so that they’re reusable no matter how the question’s asked. So it doesn’t matter if somebody’s using the same council or a different council from one fund manager to the next. 

And I think that’s why LPs love us. That and the user experience, we’ve got a 96% approval rate and satisfaction rating from our investors, and it turns out 4% of LPs just don’t like setback. Okay. There’s only so much I can do on that, but like, so that, that’s really the key thing that we’re we’re doing on. The other thing that I think is happening is, You talked about Altvia is really focused on the investor relationship. And so, you know, in, in the world 15 years ago, 20 years ago, the investor relationship was still a part of software. It was a part of a broader stack of software though. so that investor relationship was captured somewhere next to a general ledger.

It was captured somewhere next to it was somewhere next to portfolio level reporting. Portfolio monitoring. And today, now it’s captured next to investor onboarding like we’re doing today. And so we’ve, we’ve lived in this world where everything is all integrated together directly. It’s vertically integrated and it actually reminds me a lot of computers in, in the 1980s and, and 1990s. This is a little, this might feel a little strange to try to tie like private equity software to like what IBM was doing in

Jeff Williams: I am here for it. Yeah, I’m, I live for analogies, metaphors, let’s go.

Tim Flannery: If you wanted to go buy a computer in the 80s, you’d buy it from IBM. It was their retail channel. It would be their operating system, it would be their applications on their chips, on their computers. And it was awesome for IBM, it was pretty bad for customers though. So a couple things happened. Customers would get locked into deals. If they had an application that they wanted that didn’t work on that OS, then okay, you’re outta luck. You either rip everything else out. Or else you just had to make do without. And so as the industry got more and more sophisticated, as there was more and more demands on it, we moved into a world where people went from being generalists that did everything to, they became specialists and all the information became standardized and interoperable, and all the pieces became plug and play.

So you could buy a computer from whoever you wanted. You could use Windows, you could use Mac, you can get Excel on any of them. You can choose your chip, you can get whatever. And so that’s the way the world worked in computers and the same thing’s happening now. 

And so everybody that did all the different pieces of what you do and what we do and what everybody, everybody’s been doing it together in one spot. I think the way the world is moving is actually, you can choose the best relationship management tool. You can choose the best way to go onboard investors. And the key thing that you need to think about is what is the investor experience that you want? What’s your internal team’s experience that you want? 

And it doesn’t matter what tools you choose, because there’s gonna be winners in each of these spaces. It’s about how the information just moves back and forth across ’em. And so, moving to this horizontally integrated space instead where yeah, like, great, you need to make the information reusable. But, but what I think we’re both leaning into is, okay. Sure. 

We wanna make sure that all these things are connected, but you wanna build the best piece of relationship management software. And I wanna build the best way to onboard investors, and it’s incumbent upon both of us to make sure that our solutions talk to each other.

Jeff Williams: Yeah, for sure. Yeah. And the practical impact is that, you know, I was having this conversation the other day, different form with a customer and you know, the practical impact of that sort of vertical integration is that, at least somebody, if not many people across, many groups, end up on the margin and because of the user experience or the functionality or whatever it may be, and then that becomes this sort of dark spot.

Where it’s like, oh, well, you know? So if we were to actually continue the sort of visual of a circle or a cycle of some sort, you actually lose connectivity because people are like, “Things unusable. I can’t, you know, I can’t, I. Use that to do my job.” And so somebody, you know, basically goes offline and the information is no longer flowing as a result.

And so that’s important. You know, I mean, I think that this idea that, Oh, it just, we do it all,” that’s like this big red flag. You know, it ought to be, because what it really says is there’s stuff we do really well, and then there’s stuff we don’t. And when there is this option as an alternative to have, you know, kind of best of breed, like the horizontal approach you’re describing, I think that offers very practical benefits.

I wanna switch gears a little bit. Passthrough. Done a lot, winning awards, very proud of you guys, all those things. But also becoming a sort of thought leader in fundraising and logically. So it’s almost like a proxy, right? I mean, you’re growing so much that you couldn’t take absolute data, but in a way, the sub docs and the completion of them at some point can be normalized as a proxy for fundraising activity. 

So you guys just published a thought leadership piece on the state of fundraising and want to hear what some of the conclusions were. Well, I know what they are ’cause I’ve read it and we’ve talked about it, but I want you to describe to some others what, what’s some of the conclusions and takeaways there were, what’s going on in the fundraising market?

Tim Flannery: So we went out and we ran this state of the fundraising survey for the first time, and it’s something that we’re continue continuing to do annually, and the, the results were in some ways really not surprising because when you ask fund managers, is it easy or is it hard to raise right now? Four out of five say it’s really hard to raise.

Okay, great. That meets the narrative. But when you ask them, Were they going to hit their fundraising target somehow four out of five also thought they were going going to go hit their fundraising targets. And so I was trying to square that circle and understand why that’s the case. So first of all, the majority of fund managers believe that the macro environment’s gonna get better in the next 12 months.

It’s about 70% of them. Perhaps it’s hubris or perhaps it’s scrappiness or whatever it might be. We’re also seeing that there’s way more creativity from these fund managers for how they’re actually attracting LPs. So first of all, you’re seeing managers going into new regions for the first time. You’re seeing them reevaluate their placement agent strategy.

So maybe adding the first one or maybe adding somebody with a specific strategic focus. And essentially everybody is taking a look at how do we go change. This probably doesn’t mean it changed my investor composition. And so great. Everybody’s pulling out all the stops. We asked a question that when we initially designed the survey, I was like, I don’t know, should we actually include this question or not? And it was about fund managers adopting AI for their fundraising efforts.

Jeff Williams: Hmm.

Tim Flannery: It turns out they are. I was actually really surprised by the outcome on this. I knew that we experimented with it, and I know that when I talked to other companies and other executive teams, like everybody’s experimenting within their business. But traditionally what I’ve seen with fund managers is they can sometimes be laggards the things that they expect their portfolio companies to do from a technology perspective. It doesn’t mean that they’re immediately ready to go do that for their own firm. But with AI, that’s proven not to be the case. About 50% of fund managers we’re using AI to do data-driven analytics. They’re using it for operational due diligence, outreach, and building PitchBook, and that’s 50% for each of them. And so cumulatively, the effect is going to be greater than that. And so when we talk to them, it doesn’t sound like it’s become something that’s something that today is an integral part to their process.

It sounds like it’s a little bit more of an experimentation and, and my experience matches that too. Like how, how do we use AI today? We don’t use it to go create finished products, but we use it as kind of a creative partner. How can we go develop some of the content, but we talk to people, they’re using it to find lookalike investors.

They’re using it to take the thesis, take the deck, take the whatever, and figure out how to go customize it at some scale to this audience. Like they’re doing these things that give them just these little bits and pieces of leverage. And so, you know, what’s the actual impact of that? I’m, I’m not sure yet. So one thing is maybe it means I can reduce my headcount, if I can reduce my headcount by like one or two people, or even if I can reduce it by like some percent in a certain department, is that really gonna have an impact on my, on my fund, on my firm? It’s gonna be at the margins. And so I think the interesting opportunity on AI is gonna be, okay, how can I actually use it to get better returns, which our survey did not look at. But also, how can I use it to find new pools of capital? Because ultimately that’s one of the big things right now. Everybody’s looking for pools of capital in the, like constantly shifting market between GPS of power and LPs of power today. LPs of power. It’s a buyer’s market.

Jeff Williams: Yeah. Yeah. I’m just gonna out save on headcount. Everybody else said, no private equity firm ever. Right? I mean like manufacturing at like global scale. Sure. Those are things to look to to improve margins. But, yeah, you know, I think the most helpful thing I’ve heard a couple weeks back on, I think it was like a CNBC interview or something about AI was, it was very pragmatic way to profile it, which is like, think about it as something that matches up with the qualifications of like a junior professional of some sort.

 Like could you hand it like a 50 page report and be like, can you summarize this for me? You know, yeah. Like, AI’s gonna be really good at that. You know, could you go out and find something that. Like a, a junior professional of some sort would need a lot of guidance for, you know, that’s like this frontier that’s different, right?

It’s like go find a pony in a data set with very little guidance. I think that’s what everybody’s so excited about is there’s no question that that is on the horizon is a possibility. It’s just, you know, is it, is it there yet? I love that people are thinking about that, right? I mean, I think that that’s sort of early cycles like this.

Where are those opportunities? There are people doing that as well, right? It might not be quite as mainstream as the— do you remember when, when we were working on kind of preparing for the OnboardingBridge launch? You asked ChatGPT to write a poem. Describing the Altvia Passthrough integration.

And that was a moment. There were, you know, I have maybe five moments where I was, where like light bulbs went off as it relates to the current state of AI. That was one of the five and that was, , a cute little thing. So, yeah. Super interesting. I wanna talk too, just quickly on the kind of theme of what’s going on in the market.

So in, I guess it was April, you and me and a crew of folks from Altvia attended and sponsored, co-sponsored, IR and fundraising professionals event put on by PEI. Great event in New York. That was one coming up in San Francisco in September. We’ll be at that one together as well with Passthrough.

But going back to this New York one, so, you know great stuff, right? I think you and I, we’ve talked a lot about this and we won’t bore the listener with, with all the details, but. The story that I’ve told many times I think is relevant here. Is that one of the sessions, well, well first off, the, the conference overall to me was like, wow, investor onboarding is like the

You know, new cool kid, like, it’s like the hot topic at this event, right? I’ve been to this event 10, 12 years now, and, you know, there were, by the way, five or six years early on where like data and technology were never mentioned really, you know at all. And then all of a sudden the keynote was on data and it was like, well, and now, you know, a couple years later, like— investor onboarding is like the hot topic. 

Anyway, there’s a whole breakout session, an hour long on this topic. You and I step into it as listeners just to observe and— fascinating. So Passthrough came up among, you know, some of your peers in the onboarding space in the conversation, just sort of organically and I think for the most part everybody was like, yeah, investor onboarding’s great.

Like the electronic sub docs. All that stuff’s really awesome. Everybody’s super pleased with it. And then, but it just sort of felt like there was like something that was kind of left to be desired and I didn’t totally know, like reading the room, what exactly what that was. And I think, you know, maybe as, as we were standing up to leave that session, somebody just sort of blurted out like this light bulb moment where it was like, yeah, I guess the thing that is sort of left to be desired is like, how do we get that stuff in and out of our CRM?

It was sort of like it was almost this onboarding thing is happening in a vacuum and we were sitting in a room full of, you know, relationship managers who have like a sort of degree of separation from onboarding experience themselves. Hear that it’s great, everybody loves it, but we’re almost literally sort of like thinking out loud, but, but like, how do we get, you know, take advantage of that or solve the problem we have today of like manual back and forth in and out from CRM to onboarding and then back out and I was left with no choice but to be shameless to say, “Oh, by the way, you know, we’re just about to announce this, or we did just announce it.”

At that time that we were working on the integration, we’ve now, as of yesterday announced that is live and, and ready for people and customers have been using it stuff. So that was this really cool moment. I’ve told that story. I can see that you’re— it brings you joy to recall that moment too.

But I think like, and, and we, as we talk about the state of fundraising, that that event. Was big on onboarding. It was big on communications and marketing and all those things. And so I think these are all the result of the point you made, which is it’s a buyer’s market right now. And, and GPs are— yes being forced to, I think that’s okay to say, but, but even if they aren’t, they’re being proactive about like finding ways to go be smart, be strategic, find ways to build relationships, find partners that, that maybe others aren’t, and use technology to their advantage. And it was front and center at that event.

It was really cool to see that.

Tim Flannery: I agree. It did bring a smile to my face thinking about it because you and I were sitting next to each other. Looking at each other saying, 

Jeff Williams: Yeah, who’s gonna say something?

Tim Flannery: You very quickly stood up and said something and I was very happy for that. So, I don’t know, like the, there’s always changing dynamics with LPs on economics. In some cases. Everybody has demand to get into certain funds. In other cases, everybody’s trying to convince LPs, here’s how, here’s how and why you should allocate part of your 2023, 2024 number to us. So look, that’s always going to be in flux. What, what that highlighted to me, and I think it’s just a, a general trend I’ve seen in this space though, is the, the relationship between fund managers and LPs is just changing right now.

It’s just fundamentally changing and so, One of the areas that you and I are both maniacally focused on is the digital experience, right? You’re seeing fund managers for the first time actually trying to understand what are all of the different touch points that I have with my investors? How can I track them? How can I make sure that when they’re actually working with my fund and interfacing with it online? Then it’s a positive experience. 

How are they accessing sub docs and KYC/AML? Sure. Okay, great. How are they accessing docents? How are they accessing data? How are they analyzing it? How are they doing? Whatever? Because we know that sure, you, you can have all these bits and pieces and they can be effective, but if it doesn’t look right, it doesn’t look right. 

And so, you know, an analogy on this would be, I take my car into the shop, the mechanic fixes it and he leaves the grease spot on somewhere. I see that grease spot and all I can think about is that grease spot. I’m not thinking about “is my car actually in good shape or not.” I’m thinking about a grease spot. And so it is time for like fund managers we’re seeing are actually paying attention to what are all the different ways that I can interact with my LPs. And so great. That’s the digital experience and again, think it’s, that’s why we exist. 

The other thing though, and what really struck me was the changes around communication and brand building. So in communication, communication’s always been something that’s helped firms stand out. Yeah, you need to have great results, but you need to actually be able to build trust with your investors. And those kinds of things happen in the moment. So like you brought up the regional banking crisis earlier when SVB was having its weekend, had fund managers that everybody was trying to figure out, okay, what am I supposed to go do in this moment? And then you had fund managers that were saying, okay, what’s my exact exposure? What’s the exact exposure of everybody in my portfolio? How can I communicate to my LPs what I know and what I don’t know? And let them know when they’ll hear the next update from me, so they’re not just left in the dark. And from those LPs that have a portfolio of fund managers, you can bet that they had a variety of experience with those fund managers for people who were willing to communicate and people who weren’t. 

And so people who are actually willing to prioritize. Yes, like we, we are going to actively communicate with our investors. We’re gonna take time and understand, yes, this is a sales process, this is a relationship. Yes, I need to provide you investment returns. But it, it really is about this like give and take that we have that happens moment to moment. Those are people that are in really good shape today, and it’s not too late for people to do that now. 

But the other thing that was a really big takeaway for me, and I still think it’s fresh, even though this happened in, few months ago. Is the amount of people that are actually spending time investing into their brand right now. Because just the composition of who’s in the private markets is changing today. It’s been so niche, it’s been so alternative, and now it’s becoming more mainstream because retail wants to come in and fund managers wanna bring retail in and look. All the bits and pieces are breaking. 

And that’s again, why we exist and why things like our integrations are so important for those firms so that we can actually facilitate that. Just the way that you distribute to them is totally different. They don’t find out about you through a placement agent that doesn’t make sense. The way that they find out about you is through your brand, and so you’re seeing whether it’s the Blackstones of the world and the Apollos and everybody else investing all of these things, and how can we go build brands, be it through RIAs, be it directly to retail, to how do I express my thought leadership— 

Then, how do I put us out in the market? How can people spend their time learning about us before they even talk to us? And if you take a look at, you know, who are the firms that you can think of in private equity today? I saw a word cloud in some, I think a Bain report. And the number one report was, I don’t know. So like people, there’s this major opportunity to go develop brand today and we’re seeing people that are really focusing on it. And then there’s gonna be some fast follows, and then there’s gonna be people that choose to ignore it. Some of them will do it because they’re happy and satisfied with what they have.

Some of ’em are gonna get left behind in the dust, and so the market is shifting, like in the public markets, it’s an even split between institutional capital and retail capital. That’s not the case today in alternatives, and it’s starting to shift in that direction. And so if that’s the case and like what are fund managers gonna do given that information? And I don’t think  that that’s really settled in for a lot of managers today. It’s happening, but I think that everybody’s learning on the job.

Jeff Williams: Yeah. Yeah. I think it’s funny you say that. I think there maybe two or three features we’ve recently released that were like the direct result of a flood of people who came to us saying like, help us say something about this . You know? And, and it was like, there’s people who can, so we can help people say something and we can help people figure out what to say.

And the people that are well equipped to say something meaningful and to say it fast in these situations, like there’s a big signal in that, you know, it means that they’ve got a lot, they’ve put a lot of work into that. I mean, I think about like the COVID emails or like our response to COVID19, like three, four years ago.

It was like, There was this point where it was like, well, everyone else is. I guess we have to, but it was like, let’s copy the last one that we got from somebody. You know? I like, I was getting these emails from the funniest people, you know? I was like, I just don’t care. But I guess like, thank you. And so it, what’s implied in that is that you, you sort of had to send one, there was a signal or an implied signal in where you were, were you early, were you late?

But then there was also just like, who cares? You actually would’ve prevented a bad signal being late, if you hadn’t sent the email. When the content of the email is meaningless, it’s like, I do not care what your response is to COVID19, but thank you for sending this, because now I know you’re like the last one, six months later, and that you’ve spent six months trying to figure out how to communicate with your customers.

You know, and it’s embarrassing.

Tim Flannery: You, you and I have both spent some, both spent some time in, in, in selling our wares, selling our products. And so you know that when you are in a sales cycle with a prospect that you want to be responsive to their emails. You want to over communicate. You want to actually understand what their problems are and be able to talk to them and talk about how you’re solving it and be honest about where you’re not solving it and, and everything else. Fundraising and investor management is just the

Jeff Williams: Yeah.

Tim Flannery: And so like when you’re, when you’re talking to investors as a part of a fundraising process, yeah. Be on top of their requests. Be responsive to when they have operational due diligence requests that come out. Okay, cool. Just show that and then show that throughout their time with you. And so, yeah, you have to be thoughtful. If you send somebody a useless me message that was wasting their time during a sales cycle. They’re gonna be like, oh, okay. Like this is what this person’s gonna do then when I invest. 

And so you set the tone early and you set the tone thoughtfully. Like who are, who are all the different groups of people that are here?

What do they care about? How can I track that? How can I actually then manage my communication strategy effectively and not just blow my credibility?

Because ultimately, like you, you build this reputation, you build this brand through a combination of like the actions that you have directly with your. Investors, customers, whatever it might be. But then you also do it in this like megaphone way through your brand, through everything else that you’re doing. And frankly, that’s really important today. The exact stat escapes me, but something like 80% of the research that B2B buyers do on vendors today is done before they even meet them.

Jeff Williams: Yeah. Yeah, I’ve seen that too. Yeah.

Tim Flannery: Same thing for, that’s the same thing for investing. Like it, yes, you’re gonna still have to go through some type of diligence. Yes, you’re still gonna have to do some kind of reporting and like regulatory disclosures. And yes, you’re gonna have to do all this stuff, but people are getting to know you and getting to build trust with you through your day-to-day interactions and your ability to actually  have those interactions, match them where they are, and through the ways that they learn about you without you being in the room.

Jeff Williams: Mm-hmm. Yeah. Yeah. It’s funny you, you draw that parallel ’cause I do it all the time and I, I use the word customer because I, I use it in the context of like telling people they need to think about their investor experience as a customer experience. And sometimes you could clearly see or hear, or people even just explicitly say, that makes them uncomfortable to talk about their investors as customers, right?

It’s like we’d prefer investors or partners or clients and, and excuse me. The thing that I say to that is like, then it’s even more important for you to think about like, like, I don’t care what the semantics are, the terminology. The point is if people are putting this much in this thought and this much investment into creating an experience for customers and billion dollar companies are being created to create, you know offer services and products to help with that.

You know, then it’s even more important if you think that the term you use. Is reflects more sort of prestige, I suppose, than customer does by using client, partner, investor, then you should probably, you know, take the point and multiply it a little bit and it’s even more important for you, you know, and I think that’s super huge.

Well, listen man, this is awesome. You know, I could sit here and, and talk and we often do, just don’t record it for everybody else. Super thrilled to have told the world about OnboardingBridge. In fact, I’ve just been made aware as we sat here and talked for 45 minutes or so, all sorts of responses from people, people I know, people that I don’t— questions, interests.

Super cool to see that. And I think it, you know, it’s, it’s been a lot of work, a lot of, you know, vision, all the things and— Just very grateful, very proud, and, you know, want to shout out to you and the folks at Passthrough a lot of people. It took a lot of people and a lot of work to make this possible, but at the first foundation of it all is, you know, a bunch of love, a big family.

You know, two companies that enjoy working together have similar vision. And so anyway, so thank you for that and, and look forward to kind of continuing that. I’ll use the word family ’cause I think it’s appropriate, but also, you know, gotten to know your family as well. So tell your lovely wife Meg, hello for me.

But yeah, just super exciting time and can’t wait to keep going here. And we’ll, you’ll maybe, well, you’ll probably be the, the third, the first, third time. Preferred return, and then you get like a, maybe a silver badge or something and we’ll, we’ll create an awards program. You’ll start getting double points at some point.

But, just super fun story, super serendipitous that we’re sitting here now, two years later doing it again and still not done, man. It’s exciting.

Tim Flannery: Yeah. Hey Jeff, can I leave you with, you mentioned earlier the ChatGPT poem, so I actually was able to 

Jeff Williams: Yes, yes, please.

Tim Flannery: So it wasn’t a poem. I asked ChatGPT to announce a partnership between Passthrough and Altvia in the style of Earnest Hemmingway.

Jeff Williams: Right. Yes.

Tim Flannery: So ChatGPT said, Passthrough and Altvia have forged a bond, a partnership of the strongest kind. Together, they will traverse the winding paths of private markets, each bringing their unique strengths to the table. Passthrough, with its deft ability to navigate regulatory hurdles will guide the way. Altvia, with its keen sense of strategy and innovation will lead the charge. This partnership promises to be a true force to be reckoned with in the world of private markets.

Jeff Williams: Hmm. Love it. So fitting the regular listeners of the podcast will know that I make all of the music. Originally you asked me what I was gonna record for you, and I am left with no choice but to think that we might just have the first original song with lyrics, for Preferred Return, and those would certainly have to be them in this case.

That’s awesome, and I appreciate you pulling that back up. Love it just as much and totally fitting. So thank you, man. Appreciate you coming back on, appreciate working with you and keeping at it as well. 

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