The contract automation and intelligence platform Ontra has made an acquisition designed to help its clients in the financial services industry more easily and efficiently raise funds.
Ontra’s purchase of FundFormer will also provide more opportunities for the lawyers in the company’s freelance network to work with Ontra’s asset management customers across North America, Asia and Europe, Ontra said.
FundFormer helps investment funds digitize their subscription documents and aids investors in filling out those forms.
Troy Pospisil, Ontra’s founder and CEO, says FundFormer’s product will pair well with his company’s Insight platform launched last year that assists fund managers in complying with the legal obligations owed to their limited partners.
“The next most obvious area that we wanted to extend into was subscription documents,” Pospisil tells Legal Dive. “And from a strategic perspective, instead of waiting the 12 or 18 months it would have taken us to build a good product, we're in the market immediately with a great solution in partnership with a great team.”
Greater Efficiency
Subscription documents are a purchase contract whereby a prospective investor outlines their interest in a fund.
Pospisil says these forms are frequently handled in a manual fashion that involves a lot of inefficient back and forth between parties on both sides of a transaction.
FundFormer claims to address these pain points in part by converting existing subscription documents to “smart webforms with conditional logic,” and it guides investors through key parts of the process.
Additionally, the technology provides funds with each investor’s real-time status in the subscription process and purports to make it easier for fund managers to coordinate with the different parties involved, including legal counsel.
Pospisil says the technology helps investment funds “close funds faster, provide a much better experience for their investors and ultimately save a lot of money.”
Combined Platform
Pospisil also highlights that once the subscription documents are finalized, data in FundFormer can then be exported for use in fund administration, investor onboarding and regulatory compliance.
These features working in concert with Ontra’s Insight platform will allow investment funds to raise money and manage investor obligations on a single platform.
Pospisil says his company has received positive feedback to the new purchase from customers who also already use FundFormer, including The Raine Group.
“We view the Ontra acquisition of FundFormer as a natural partnership to deliver solutions to fund managers at various points of a previously manual process,” said A.J. Chianese, The Raine Group’s general counsel.
Important role for lawyers
In addition to its contracting software, Ontra possesses a network of more than 500 freelance lawyers that assist the company’s clients with their contracting needs. Another Ontra official previously told Legal Dive the company calls its approach the “lawyer in the loop” model.
Pospisil says the company’s network of attorneys will have a key role to play in helping clients use FundFormer. He anticipates they will be instrumental in assisting with the digitization of subscription documents during client onboarding, as well as ensuring a smooth digital workflow.
Pospisil also expects the legal network will be instrumental to helping FundFormer, which has a small team compared to Ontra, accelerate its growth.
“By having the power of that lawyer platform, they'll be able to onboard many more customers much more quickly,” he says.
FundFormer team
As part of the acquisition, the FundFormer team will join Ontra, including FundFormer CEO Allen Pan and co-founders Jing Sun and Aaron Barnet.
Pan is a former private funds attorney at Simpson Thacher & Bartlett, a law firm well-known for its work in the financial services sector.
Pan co-founded FundFormer “as a way to solve the problems with subscription documents he consistently encountered as a fund formation attorney,” according to the company’s website.
Pospisil says he was not only very impressed by the product the FundFormer leaders built, but also by their professional backgrounds.
“With legal tech in particular, when you're trying to solve complex problems, it's really hard to crack the nut on solving the problem if you haven't lived it and understand all the unique nuances and corners of that problem,” Pospisil says. “So one of the things that really attracted us to this team is their experience, their deep understanding of the problem and their passion for solving it.”
