The top 5 challenges of investor onboarding and the need for digitization


Wednesday, May 19, 2021 | By Jonathan Marr, Sr. Director, e-Investor

The top 5 challenges of investor onboarding and the need for digitization

Investor onboarding in today’s environment is crucial; organizations are choosing to digitize their investor onboarding experience to create a solid, long-term, mutually profitable relationship with investors.

Today, if an investor wants to invest in a fund, they have to manually complete a subscription document. These documents are usually 50-80 pages long, full of legal language, with complex forms embedded within them. Investors are then left to decipher the forms to complete them correctly. 

SS&C’s analysis finds that only about 20%of subscription documents are completed successfully on the first pass using traditional manual methods. This low success rate can be traced to five key challenges or obstacles that are inherent in the process:

The common challenges to increasing the life cycle of investor onboarding are:

  • Document complexity—Increases time to complete and chances of mistakes.
  • Data completeness—Slows down process, requires back and forth.
  • AML collection—Slows down process, increases back and forth requests.
  • Signature collection—Entity investors with multiple authorized signatories can delay processing.
  • Process transparency—Monitor investor progress without manual follow-ups.

While these challenges do exist in today’s digital ecosystems, these challenges can be overcome and firms can reduce the risk around data collection and transaction management while adding transparency to your capital raising process. With technology at the core of the subscription process, it is not performance in isolation, but rather, becomes streamlined into a systematized process, improving the experience for the investor and reducing the cycle time to receive funding. It also creates flexibility and accessibility for investors.

To realize these benefits the technology must meet exacting criteria. Specifically, it needs to map to and address five key challenges to successful document completion outlined earlier.

  • It must minimize document complexity.
  • It must ensure complete data at the time of submission.
  • AML requirements must be built into the subscription document.
  • The solution needs electronic signature capabilities.
  • Managers should have sufficient transparency to track document status at any time.

By making the experience as seamless as possible for the investor, a fund manager stands a better chance of leveraging that first impression into a long-term relationship with repeat engagements.

To learn more about how you can streamline your investor onboarding experience and add transparency to your capital raising process, and how your firm could benefit from a web-based tool that provides a logic-based approach to your complex subscription documents and AML/KYC requirements, download our recent webinar Streamlining your investor onboarding experience and adding transparency to your capital raising process

Download our new whitepaper, Mastering the Top Five Challenges in Investor Onboarding, for step-by-step guidance on creating an onboarding experience that secures the investment and lays the foundation for a solid, long-term, mutually profitable GP-LP relationship.

SS&C’s e-Investor is an end-to-end processing platform that automates the delivery, completion, submission, and tracking of all investor transactions, starting with initial onboarding. When combined with SS&C’s e-Fulfillment, it can distribute targeted marketing material and subscription documents to potential investors through a secure web interface with detailed activity tracking. e-Investor enables fund managers to validate and verify entered data before submitting documents for processing and subsequent transactions for existing investors, including redemptions, transfers, and changes.



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