April 17

Press Release: OpenInvest Closes $10.5 Million Series A1 Strategic Financing Round

OpenInvest, the tech-enabled asset manager that provides customization, direct indexing, and ESG investing at scale, announced it has completed a $10.5 million Series A1 round of strategic financing. QED Investors led the investment round with participation from existing investor SystemIQ and two additional investors: Resolute Investment Managers and ABN AMRO Ventures.

The new strategic round of investment brings OpenInvest’s total funding since launching in 2015 to $23.8 million and is expected to help accelerate their mission to power impact investing globally. According to estimates from The Forum for Sustainable and Responsible Investment, ESG  investing has grown 38% in the last four years, with every major asset manager entering the market.

The Series A1 financing builds on a terrific year for OpenInvest, which included expanding its partnerships, leadership team, engineering capacity, and product suite. In 2019, OpenInvest announced partnerships with Legal and General Investment Management America and Bank of the West, expanded impact reporting and tax optimization capabilities, and added investing categories targeting Disability Inclusion, Racial Justice, and Heart Healthy investing. So far this year, OpenInvest was recognized by Fast Company on their 2020 Most Innovative Companies list, won “Best Retail Investment Platform” in the annual FinTech Breakthrough Awards, and launched their commercial partnership with Resolute.

“OpenInvest is disrupting traditional asset management and ushering in the post-fund world. Our software enables financial advisors to seamlessly personalize products for clients according to their values and tax situations,” said Josh Levin, Chief Strategy Officer and Co-founder, OpenInvest. “Our new round of funding helps us expand engineering capacity to meet rapidly growing demand across wealth and asset management platforms.”

A key differentiator for OpenInvest is its Dynamic Custom Indexing (DCI) capabilities. DCIs replicate strategies by directly purchasing the underlying stocks. By bypassing the fund manager, DCIs allow direct indexing, personalized ESG investing, and enhanced tax efficiency. As a result, financial advisors are able to tailor strategies to the unique situations of their clients, driving differentiation, retention, and pricing while maintaining firm-level discipline.

According to Gene Needles, CEO of Resolute, “Our investment in OpenInvest is well-timed to help us meet accelerated demand for impact investing solutions at scale.” Resolute Investment Managers, a diversified, multi-affiliate asset management platform with more than 40 affiliated and independent relationships, is collaborating with OpenInvest to make OpenInvest’s Dynamic Custom Indexing (DCI) platform available across Resolute’s extensive distribution network of investment managers.

“OpenInvest is powering tech-enabled impact investing that is flexible enough to account for investors’ preferences without sacrificing the rigor that asset managers must adhere to as fiduciaries,” Hugo Bongers, Managing Director, ABN AMRO Ventures. “ESG investing and sustainable investing, combined with the OpenInvest approach, are at the core of our purpose and strategy of banking for better for generations to come.”

Photo courtesy of GotCredit.

Source: Press Release (link opens in a new window)

Investing, Technology
ESG, impact investing