PENSCO, an alternative asset custodian for self-directed IRA investors, announced its new paperless deal funding technology — PENSCO Alt-Nav.
The dubbed “first-of-its-kind” technology has been designed to help retirement investors who would like to invest in non-traded alternative assets using their retirement accounts, as well as those trying to raise capital – including entrepreneurs, private fund managers or private businesses – who want to work with these individual investors. The proprietary technology is the latest innovation by PENSCO that streamlines and simplifies the deal-funding process, providing benefits to both capital raisers and IRA investors alike.
There is currently more than $7.3 trillion held in IRAs and of that, the self-directed IRA market is estimated to custody about $146 billion. Since 2013 the IRA category has grown by 12% while assets in self-directed IRAs have grown 21% as investors increasingly look to diversify their retirement portfolios away from traditional stocks and bonds.
Kelly Rodriques, CEO, PENSCO, stated:
“Self-directed IRA investors can invest in a wide range of non-traded alternative assets, from real estate and private equity, to commodities and equity crowdfunding, however the administrative process has been onerous given every unique investment requires different documentation. Given this, we saw an opportunity to be the first custodian to offer a solution for entrepreneurs and retirement investors that makes it as straightforward to make investments with alternative assets in an IRA as it is to buy stocks or bonds with your IRA. This is a win for IRA investors as well as for investment sponsors.”
Whether it is a private fund manager or an entrepreneur who is looking to raise funds from IRA investors, or an investor who has already identified an opportunity and is ready to invest using their IRA funds, PENSCO Alt-Nav takes the previously complex and paper intensive process and has made it entirely web-based, simple and guided, including drag/drop features for uploading investment documents and e-signature capabilities.
While the first release of the technology primarily supports investments in private funds, LLCs, and LPs for individual investors, PENSCO is committed to further developing the technology to support equity crowdfunding sites, peer to peer lenders, real estate, notes and other non-exchange traded investments with another release very soon.
“Financial technologies are driving change in every corner of the investing world. You need look no further than the news coming out of Finovatethis week to appreciate the breadth of offerings out there. We are very proud to launch PENSCO Alt-Nav because it redefines the entire investment process and clears the way for IRA investors to diversify their portfolio with alternative assets without the existing paper intensive burden.”
How Does It Work?
- Individual investors with a private placement opportunity can go directly the company’s website and follow a step-by-step guided process to open, fund and invest in the opportunity.
- Capital raisers who work with PENSCO will receive a unique link to a portal where they candrag and drop the documents required to get their investment reviewed by PENSCO. Investors in their offering will then use the Alt-Nav technology to open and fund their account and electronically complete an investment authorization pre-populated with all the capital raiser’s deal information, eliminating the need for the investor to provide repetitive information and avoid the complexity of obtaining investment documents. They will simply review and affirm to fund the deal.