Today on the Alt Goes Mainstream podcast we have a guest who is making alts go mainstream by streamlining the process of investing into funds.
Carta and fund manager veteran Tim Flannery is the Co-Founder of Passthrough, a fund workflow automation tool that digitizes and automates the fund subscription process.
We had a fascinating discussion about how Passthrough is providing critical market infrastructure to the alts space and what the future of investing into funds looks like with Passthrough.
* Why there needs to be innovation around fund closings.
* How data matters in the fund closing process.
* How creating an investor passport can lead to efficiencies across the alts space.
* How Passthrough is the “narrow waist” of the alts space — building the connective tissue for funds and LPs to complete closings and then use that data in all sorts of places and sit on top of platforms like iCapital, CartaX, AngelList, Republic, and others. In a sense, Passthrough is a solution for the alts space in a similar manner to how WalletConnect is the connective tissue between wallets and DApps in the crypto ecosystem.
Fund closing is generally a painful process for everyone involved — LPs have to manually input data into subscription documents, which means they often miss questions or err in their answers. Much of this data is unstructured, hidden within PDFs, meaning that funds can’t use this when LPs re-up to following funds or to other funds. Fund managers have little visibility into the raise and timing for closings.
Tim is building a product with Passthrough that gives fund managers one of their most valuable assets — time — back and provides for a great user experience with fund closings. Passthrough automates the fund closing process by digitizing subscription agreements, turning them into a custom, TurboTax style workflow.
We were lucky enough to use Passthrough for our investment into Lowercarbon Capital and we never knew how easy a fund closing could be after using Passthrough. Passthrough’s fastest sub doc completion on record is said to be 6 minutes and mine wasn’t that far off.
The process is simple, automated, and efficient since Passthrough collects relevant data on LPs so that it's easier and quicker to subscribe for the next fund.
Tim has a great background to be building Passthrough. He was previously the Head of Go-To-Market for Investor Services at Carta and also worked on a number of large strategic accounts. He also spent time as a Partner at Pilot Mountain Ventures and started his career at JP Morgan in PE fund services, so he's seen the lifecycle of a fund investment from all angles.
He's a sharp, thoughtful, and focused founder who is building a product that many GPs and LPs already love.
This was a fascinating conversation about bringing technology to automate the alts space that I’m excited to see play out over the coming years in the space.