Dynamic Custom Indexing Company OpenInvest Raises $10.5 Million

By Noah Long ● April 16, 2020
  • OpenInvest, a tech-enabled asset manager that provides customization, direct indexing, and ESG investing at scale, announced it raised $10.5 million

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

This round of investment brings OpenInvest’s total funding since launching in 2015 to $23.8 million. And the funding is expected to help accelerate their mission to power impact investing globally.

The Series A1 funding round builds on a momentous year for the company — which included the expansion of its partnerships, leadership team, engineering capacity, and product suite.

Last year, 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.

One of the key differentiators for OpenInvest is its Dynamic Custom Indexing (DCI) capabilities. And 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 personalize strategies to the unique situations of their clients, driving differentiation, retention, and pricing while maintaining firm-level discipline.

Resolute Investment Managers, a diversified, multi-affiliate asset management platform with over 40 affiliated and independent relationships, is partnering with OpenInvest to make OpenInvest’s Dynamic Custom Indexing (DCI) platform available across Resolute’s extensive distribution network of investment managers.

Key Quotes:

“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. Our new round of funding helps us expand engineering capacity to meet rapidly growing demand across wealth and asset management platforms.”-Josh Levin, Chief Strategy Officer and Co-founder at OpenInvest

“Our investment in OpenInvest is well-timed to help us meet accelerated demand for impact investing solutions at scale.” 

-Gene Needles, CEO at Resolute

“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. 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.”

-Hugo Bongers, Managing Director at ABN AMRO Ventures