Speed up investor onboarding with digital subscription documents

March 20, 2023

Speed — or lack thereof — is a common challenge in the traditional investor onboarding process. Despite asset managers’, fund administrators’, and outside counsels’ best efforts, it often takes weeks or months for managers to clear investors to close. The result is delayed access to the capital managers need to move forward with deals.

For years, there was little managers could do to speed up the subscription process other than to pull in more staffing resources, constantly ask their counsel for status updates, or work late nights and weekends. Now, however, there’s a clear solution: Firms can digitally transform the subscription process. They need FundFormer, a digital solution within Insight, specifically built to optimize and accelerate investor onboarding.

FundFormer is a digital investor onboarding platform for asset management firms.

What slows down the traditional subscription process

There’s no mystery as to why the traditional subscription process, which relies on 100+ page PDF subscription books, is slow.

The typical subscription process requires investors to manually identify relevant forms and questions since sub-books aren’t tailored to investor type. Investors then ask firms numerous questions and often end up in back-and-forth email threads. In the end, investors still submit sub-books with incomplete or inaccurate information.

What follows is weeks of review and multiple rounds of corrections by the asset manager, its administrator, and outside counsel. Managers have to confirm they have complete and accurate information for their internal purposes as well as regulatory requirements, such as AML/KYC regulations.

Unfortunately, mistakes slip through, and it’s possible for firms to move forward without all the information they need. In the best of circumstances, the parties can correct the errors when they spot them. However, there could be serious legal and financial consequences if managers lack the correct information to meet regulatory requirements.

The subscription process also lacks a quick, efficient way for managers to see investor status and determine the next best steps. Throughout the process of onboarding dozens, if not hundreds, of investors into a fund, firms must repeatedly ask their counsel to review and update investor status. Without that information, the investor relations team can’t proactively encourage and help investors submit their sub-books.

Overall, while traditional sub-books technically get the job done, they often don’t onboard investors efficiently, quickly, or even accurately.

Top 10 Terms in Subscription Documents

Why a digital subscription process is faster

How can asset managers move investors through onboarding faster? By digitizing documents and offering investors access to a white-label online portal. FundFormer, available with Insight, provides firms with a fully digital and efficient process that can drastically speed up the time to close.

FundFormer uses conditional logic to limit the forms investors must navigate based on investor type. Investors move through a guided process to complete the questionnaires, including with visual cues regarding missing or incomplete information. Ultimately, the FundFormer solution won’t let investors submit their sub-books until they’re complete

If investors have questions, they can communicate directly in the portal. This offers more organized, effective, and secure communication compared to email.

Managers also benefit from real-time investor status on their fundraising dashboard. All parties can immediately see where investors are in the pipeline, and there’s no longer extra work for outside counsel to dig up specific investors’ statuses.

Once investors complete all the necessary fields, they can use an electronic subscription integration to sign their sub-books and deliver them to the firm. FundFormer can simultaneously deliver signature-ready contracts to all parties, eliminating lags caused by sequential signing. It also can prompt signatories to take immediate action through automated reminders.

Investor profiles accelerate future fundraises

An innovative feature of FundFormer is the ability for investors to create profiles and save their information. In future fundraises with the same firm, investors can auto-populate forms based on their saved investor profile. This speeds up the process and ensures the investor’s information is consistent across funds.

Clear investors to close in days, not weeks

Asset managers are intimately familiar with the challenges posed by antiquated subscription methods. Now they have the opportunity to digitally transform this process and address those challenges. Instead of bogging down internal legal, accounting, and investor relations teams with manual, error-prone work, firms can adopt a better way to move forward.

Interested in learning more about a digital fundraising workflow?

Additional Reading