New York City-based alternative investments platform Arch has raised $52 million in a Series B funding. Venture capital firm Oak HC/FT, which is a new investor in the platform, led the round. It also included Menlo Ventures, Craft Ventures, Quiet Capital and others.
The funding will support Arch’s ongoing expansion and development, with a focus on meeting the needs of institutional investors, private wealth teams and family offices.
Arch is among the fintechs seeking to streamline and automate the investment process for private market investments with the goal of eventually making it a “one-click” experience. Currently, the tool automates collecting and structuring financial data from documents, including K-1s and statements, from various portals and emails into one location. Features like Arch Pay automate capital calls.
According to Arch co-founder and CEO Ryan Eisenman, a typical placement in a drawdown vehicle takes up to 5,500 clicks between navigating different portals, sub docs, interlinks, acquiring K-1s, capital calls and reporting. He estimates that Arch has now automated 84% of that process and is striving to address the remaining 16%.
“Some of the things we haven’t done that are some of pain points around fully completing capital calls, digitizing the wiring process and some things around sub docs and how we can manage at scale and work with some of the other platforms out there,” Eisenman said.
Arch said its platform assets have grown from $100 billion to over $250 billion over the last 14 months. It now serves over 450 allocators globally, including four large private banks, seven of the 25 largest accounting firms and institutional investment and wealth management firms.
In terms of navigating the competitive landscape, which includes other firms specializing in private markets and more traditional TAMPs looking to add alternative investment functionality, Eisenman said Arch has an open API that allows for integration with other platforms. For example, Envestnet is integrating Arch into its platform, and Eisenman said similar integrations are in development with other platforms.
“I think this industry needs stable systems around alts, high-quality data and great client experiences,” he said. “We belive in a ‘best-in-class’ ecosystem of great providers working with other great providers. … That’s why we’re API first, to make it easy for other firms to write to our API and allow for native integration with third-party providers.”
The Series B funding is Arch’s largest funding round to date by a large degree. It initially raised $5.5 million in a seed round in 2021 and then $20 million in its Series A round in 2023. Early investors in the platform included founders from Aduro Advisors, Altruist, Sydecar, and Vanilla. Other investors include Carta, Citi Ventures, GPS Investment Partners and Focus Financial Partners.
Oak HC/FT is a venture and growth equity firm specializing in investments in fintech and healthcare. Founded in 2014, Oak HC/FT has invested in more than 100 portfolio companies and has over $5.3 billion in assets under management.
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