Arch is a company that solves many of the problems facing active Investors / LPs: collecting K-1s; logging into the various web portals; and tracking performance, cash flows, and metrics across their investments. Pulse 2.0 interviewed Arch co-founder and CEO Ryan Eisenman to learn more about the company.
Ryan Eisenman’s Background
What is Ryan Eisenman’s background? Eisenman said:
“I grew up in Houston, Texas, and was interested in investing and the markets since I was young. I went to Vanderbilt University, where I studied Human and Organizational Development (i.e. how people and organizations function and evolve), along with economics and business. I live in New York City now, where Arch is based and where I met Jason and Joel (the other two Arch co-founders).”
Formation Of Arch
How did the idea for Arch come together? Eisenman shared:
“In mid-2017, I was chewing on the larger question of ‘How do people make investment decisions and choose asset manager A over asset manager B?’ Around this time, I met an investor who was equally passionate about private markets and especially fired up about how painful it was to be an LP.”
“This investor was chatting about this idea with two very smart software engineers from MIT (Jason Trigg and Joel Stein), and he introduced the three of us together. Once we decided to build Arch (after a couple of months of research and three days of figuring out our name), the original investor and a family office became our two initial design clients, the investor’s Venture Capital firm, Quiet Capital, wrote the pre-Seed check into Arch, and we were officially in business.”
Favorite Memory
What has been your favorite memory working for the company so far? Eisenman reflected:
“My favorite thing is unsolicited feedback from our clients, which makes our product better every day. Arch began as a platform for collecting K-1s and it is because of constant client feedback that we have evolved our product into an operating system for investors to manage and understand their alternatives portfolio.”
Core Products
What are the company’s core products and features? Eisenman explained:
“Although we started out as a K-1 tax document aggregator, our clients today use Arch as a way to report on and understand their private market investments on a deeper level. We have built out a sophisticated task management system for investment teams to track cash inflows and outflows, and are proud of our open data program that allows users to export any data from Arch to share with end clients or insert to their own modeling.”
“Our original tax document offering has also expanded to include expected delivery dates and automated follow-ups to funds that have not delivered their documents as expected so that accountants can get their clients’ tax documents directly through Arch.”
Challenges Faced
What challenges have Eisenman and the team faced in building the company? Eisenman acknowledged:
“It was hard when we started the company six years ago, as 20-somethings with a big dream to get the industry to take us seriously. It wasn’t until we started signing large family offices, RIAs with thousands of investments and global banks that these questions went away.”
“Immeasurably – when we launched, all we had was a solution for automatically collecting K-1s, giving access to the end accountant along with the advisor and client. Based on feedback since inception, Arch is now more of an operating system for managing private investments, solving several of the top pain points for clients, while giving them access to documents, data, and insights in a single digital platform. We’ve raised $25m, grown our headcount from 3 to 90 people, and went from subleasing a few desks from a friend’s company to opening a new 40,000-square-foot headquarters at 225 Park Ave. South, formerly The New York Times building..”
Significant Milestones
What have been some of the company’s most significant milestones? Eisenman cited:
“To date, Arch has more than $100 billion in client alternative investments on the platform and currently serves more than 270 investment firms, families, and institutions, including one of the largest U.S. banks.”
“We’re excited about our continued enhancements to the Arch solution, including artificial intelligence smart summaries, data insights, tax tools and a modern user interface. However, we’re most proud of our organic client referral rate. More than half of our clients refer Arch to another potential client. To us, customer success is success at Arch.”
Customer Success Stories
When asking Eisenman about customer success stories, he highlighted:
“During our bi-weekly All Hands meetings, we vote as a company on the best customer quotes from the last two weeks. Some of my favorite quotes from recent memory are that Arch ‘is an employee that you don’t have to manage, and it’s half the cost, and does the work of 6’ or that it is ‘going to save my marriage.’”
Funding
When asking Eisenman about the company’s funding details, he revealed:
“Our $20 million Series A in November brings Arch’s total funding to $25.5 million. Many of our Series A investors started out as customers who wanted to fund our growth.”
Total Addressable Market
What total addressable market (TAM) size is the company pursuing? Eisenman assessed:
“When we first set out on a mission to modernize private investment management 6 years ago, we understood there were various challenges and hurdles to overcome. The rise in investor demand coupled with the application of technology to this sector has supported strong private markets growth. According to recent research from CAIA, alternative investments are sitting at $22 trillion in assets under management, or 15% of global assets under management.”
Differentiation From The Competition
What differentiates the company from its competition? Eisenman affirmed:
“Beyond how fast we build new products based on direct feedback from clients, we take great pride in a high level of client service. Each new customer is introduced to a dedicated member of our Operations team to walk them through the process of onboarding their investments, and has direct contact in our New York office even after their investments are receiving data.”
“Arch is populated by data provided directly from the funds and requires no input from the LP. We also have built sophisticated integrations with other performance reporting providers to expand the capabilities of the data we are collecting for our clients.”
Future Company Goals
What are some of the company’s future company goals? Eisenman concluded:
“There are a ton of workflows that are still painful for LPs (and GPs, accountants, and advisors). Our mission is to automate the management of private investments, giving people decision-altering insights along the way. Come visit us in our New York office, and we’ll show you some of the (secret new) things we’re working on.”
