For decades, the private funds industry has delivered market-beating returns and taken an increasingly greater share of global assets. Aggregate industry deal value, transaction volume, and assets under management set new records almost every year. Most firms continue to target larger and larger funds while meeting or exceeding their goals. Despite all that success, a crisis has been slowly brewing under the surface for asset managers.
The cost and complexity of managing a fund have been growing substantially faster than AUM. Asset managers are operating in more jurisdictions, investing in more types of assets, creating innovative fund structures, and utilizing new, creative forms of financing across transactions and funds. Counterparties, such as limited partners, are becoming more sophisticated, demanding more complex terms and liquidy of once illiquid investments. Regulators are continually changing the rules of the game, while new threats such as cyberattacks and political instability grow in number and size. So while AUM grows linearly, the cost and complexity of managing those assets are compounding. This is especially true as it relates to legal work.
The unfortunate reality is that asset managers just aren’t able to keep up. While firms have been racing to hire to meet the mounting administrative pressures, there is more work to do than can be done. And continuing down the same path of more people and longer hours is not going to yield a different result. If asset managers can’t identify a better, scalable way to address this compounding complexity, important work will slip through the cracks. The result will be more frequent and material negative impacts on performance, compliance, and relationships.
Asset managers have three critical dimensions to their business — raising funds, investing capital, and operating assets. Each of these areas involves a high volume of routine legal work. As this work has grown, legacy tools and manual efforts are breaking. Asset managers need a centralized, digital platform to streamline and organize these legal workflows.
That’s why I’m thrilled to introduce Ontra’s legal operating system for the private markets — a revolutionary innovation for our industry that will transform our customers’ businesses across all aspects of their operations. Most importantly, Ontra’s legal operating system will enable our customers to catch up with the complexity of their operations, confidently tackle their work, and get back to focusing on performance and growth.
Ontra developed this suite of products through close collaboration with the top minds in the technology and private markets spaces. We tapped leading artificial intelligence experts, aggregated best practices from the world’s largest asset managers, and consulted experts across the legal and compliance arenas to develop the best way to revolutionize workflows for private markets.
Ontra’s legal operating system allows asset managers to digitally transform their legal workflows across all critical areas of their business with three purpose-built products: FundFormer, Contract Automation, and Insight.
- FundFormer streamlines the fundraising process by providing a seamless digital subscription experience. The solution allows funds to manage critical aspects of investor onboarding, including collecting subscription and AML/KYC documentation and tracking the investor pipeline.
- Contract Automation combines AI and an experienced global network of lawyers to streamline the negotiation and management of routine contracts.
- Insight translates the fund obligations buried in legal documents into actionable data that asset managers can use to drive contract compliance and better inform negotiations.
We’re committed to helping our customers successfully transform their legal workflows. To that end, in the coming weeks, we’ll be releasing a number of resources to help them through that digital transformation. These include curated industry commentary, best practices gleaned from leading asset managers, forums in which leaders can gather to network and exchange ideas, and, of course, groundbreaking technology to put these ideas into action.
Keep an eye out and don’t hesitate to reach out to me via LinkedIn with questions or suggestions. We’re on an exciting journey together with much more innovation to come!