Invest Like the Best with Patrick O'Shaughnessy

Tim Flannery - Simplifying Fund Closing - [Founder’s Field Guide, EP. 55]

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Feb 17, 2022

Tim Flannery, co-founder of Passthrough, revolutionizes venture fund administration by simplifying investor onboarding through innovative software. He discusses the transformative power of identity in product design and how his team addresses the often-overlooked complexities of fundraising. Tim also dives into democratizing investment opportunities and reducing friction for emerging fund managers. The conversation showcases how technology is reshaping the financial landscape, enhancing access, efficiency, and transparency in the investment process.

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INSIGHT

Democratization of Investing

Individual investors will soon have access to sophisticated investment strategies like the Yale endowment model.
This democratization is driven by new products and changing regulations.

INSIGHT

Increased Access to Private Markets

Platforms like AngelList and regulatory changes, such as the one allowing IRAs into private funds, are driving the accessibility of private market investments.
This creates opportunities for both new fund managers and individual investors.

INSIGHT

Streamlined Investing

Passthrough aims to streamline investing by centralizing investor information and enabling one-click investments.
This simplifies the process for both investors and fund managers, allowing managers to focus on their core competency: deploying capital.

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My guest today is Tim Flannery, co-founder of venture fund administrator Passthrough. Passthrough is removing friction from the manual, time-consuming fundraising process by making investor onboarding as simple and automatic as possible. Their software helps investors fill out subscription documents in minutes rather than hours and allows GPs to easily track LP subscriptions during a fundraise.

In our conversation, we discuss the power of identity as a feature to build products around, the double-edged sword of solving an unsexy problem, and how Passthrough has thought about pricing their software. Please enjoy my conversation with Tim Flannery.

For the full show notes, transcript, and links to mentioned content, check out the episode page here.

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Show Notes

[00:02:08] - [First question] - The push and pull nature of what Passthrough is trying to solve

[00:04:17] - What the idealized end state 10 years from now looks like

[00:07:33] - A history of friction in investing and what barriers still remain today

[00:12:35] - The spark of insight that led to starting this new venture

[00:17:45] - Lessons learned from Okta and why identity is so powerful

[00:19:39] - Plans to expand this concept deeper into the tech stack

[00:22:24] - Adjacent problems that they plan to tackle as they continue to scale

[00:24:30] - What it feels like to use their product as an LP today

[00:26:10] - Working with service providers without becoming one

[00:28:06] - What great sales and distribution looks like to him at the infrastructure level

[00:31:50] - Defining what “bring your collaborators” means

[00:33:19] - His secret to recruiting talent to help solve an unsexy problem

[00:37:46] - His love for the intersection between process, pipelines, and efficiency

[00:40:12] - Having a process for designing processes

[00:42:11] - How they arrived at their pricing and thoughtful pricing in software

[00:45:08] - Lessons from building Passthrough that other builders could benefit from

[00:47:16] - The kindest thing anyone has ever done for him