How SignalFire streamlined investor onboarding with Passthrough

May 18, 2023

Venture capital engineered to ignite growth

What started as a stealth, artificial intelligence recruiting platform has evolved into a new venture model.

SignalFire began its journey in 2013 as a bootstrapped data science firm with the goal of disrupting how talent management is done. SignalFire now uses this AI tool to address pain points in its portfolio companies in order to help them supercharge their growth.

Since launching its first fund in 2015, SignalFire has scaled quickly to over $1.8b AUM and continues to be a leader in innovation across the VC space.

Spencer Ackermann, CFO at SignalFire, has a deep background in investing operations from helping build out and systematize finance and compliance functions at other top-tier venture capital firms, including Social Capital and Morgenthaler Ventures.

Innovation needs to be an inside job

He realized the SignalFire’s investor onboarding process wasn’t living up to the firm’s ethos of innovation.

“My goal at SignalFire is to do things more efficiently with software and systems, not with time,” says Spencer. “One of the things that takes a load of time is wrangling LPs’ subscription documents, making sure that they’re signed, making sure that they’re right. The back-and-forth was just a big waste.”

Prior to implementing Passthrough, the investor onboarding process could be complex: documents were sent to LPs who would download them, sign them, and send them back via the fund’s law firm. The law firm would review them and come back with any questions or comments that the SignalFire team would have to comb through.

“There’s a lot of manual lift to onboarding new investors,” says Rebecca Hayen, Investor Relations Associate at SignalFire. “In the conventional subscription document process, our lawyers would have up to 10 comments or edits in the documents for our investors, making the back and forth between all the parties difficult to manage. In some previous cases, we would have almost a 12-hour lag in communication between all the parties, making closing on time challenging.”

"Passthrough has given us a much more standardized and simple’s so streamlined and fast now."

A tailored solution for success

While looking for a solution, Spencer found that Passthrough had answers that other solutions didn’t have.

“We have a degree of complexity in the way that we manage our subscriptions into our funds,” says Spencer. “We have funds that have investor commitments split based on our predetermined percentage. So if they’re subscribing $1m, $350k goes here and $650k goes there, and I want that to just happen. The other vendors we spoke to told us that we’d just have to do two different sets of documents. Passthrough’s answer was ‘sure, we can do that’, and they did. It was this flexibility to make the software do what we needed it to do that put Passthrough ahead of the others we looked at.”

The implementation was fast and pain-free, in Spencer’s view. “I really enjoyed working with the Passthrough team,” he says. “Any question I had or issue that I needed to solve, they would come back to me with an answer within the business day. We were on deadlines with closing dates and they were very mindful of that as well. They quickly implemented everything we needed.”

"Having a solution for both [individual and institutional investors] is really difficult, and we got that with Passthrough. It was seamless and very intuitive."

Time well spent: SignalFire’s gains

The impact of using Passthrough was immediate. “The most noticeable benefit of Passthrough is the seamless communication and collaboration with our law firm, investors, and our team.” says Rebecca. “All parties can see comments and edits within one platform. Investors appreciated having a centralized location to view their status.”

For the team at SignalFire, time saved has been a measurable benefit of implementing Passthrough.

“Moving quickly and efficiently is our goal,” says Rebecca. “We have investors all over the globe. Passthrough has given us a standardized and simple process to notify through the platform without relying on our law firm. With Passthrough, our process is streamlined and efficient.”

“My favorite part of the process now is checking in on the status of the raise on Passthrough.” she says.

A big part of Passthrough’s appeal to SignalFire is the radical improvement to the onboarding experience for its broad range of investors. “When it comes to our LPs, we have both ends of the spectrum,” says Spencer. “We have some people who are true world leaders in innovation, and we have people whose money is from some of the oldest sources on planet Earth. Having a solution for both is really difficult, and we got that with Passthrough. It was seamless and very intuitive.”

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