Mastering Investor Onboarding in 3 Steps

Mastering Investor Onboarding in 3 Steps

Whether you run a private equity fund, a wealth management firm, or a cutting-edge investment platform, you'll need to do KYC to bring in new investors and comply with AML regulations. In this guide, we'll explore what this involves and how to make your processes simpler and more efficient.

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What is investor onboarding?

Investor onboarding often moves at a snail's pace. It involves lots of back-and-forth, manual verifications, multiple spreadsheets, and heaps of paperwork.

These slow methods can cause significant delays, frustration, and potential churn. Plus, the high level of human involvement makes it prone to errors, increasing the risk of non-compliance.

After collecting investor info, fund managers manually input it into various systems for checks and record-keeping. Luckily, there's a way to speed up the process and free up valuable time for everyone.

Go digital for onboarding

Instead of sending fillable-PDF, or worse paper forms, consider making your investor onboarding process fully digital. This comes with a lot of benefits that will help you make the process more efficient.

Pre-fill: One key strategy to accelerate onboarding is implementing pre-fill. By automatically populating known data fields, investors are spared redundant tasks, reducing time and effort on their end.

Only ask for necessary documents: Request only the essential documents that cannot be obtained through alternative sources. This not only expedites the onboarding process but also enhances the overall user experience.

Use conditional forms: Implement conditional questions to ensure that they are relevant to the unique circumstances of each investor. This customization streamlines the process and minimizes unnecessary steps.

Allow resume-later and avoid back-and-forth: Enable investors to resume the onboarding process later if needed, and strive to automate communication to reduce back-and-forth exchanges. This ensures a smoother, more user-friendly experience.

Implement e-signatures: Embrace e-signatures to facilitate the completion of necessary documents, eliminating the need for physical paperwork and accelerating the onboarding timeline.

Automate back-office reviews

Now that your investor has submitted all its information, your team needs to review it. This is usually when things get complex and the compliance team must navigate between multiple tools and conduct manual and error-prone verifications.

Use automated risk assessment: Does your risk matrix still live in a spreadsheet causing you to enter investor information manually? Not only this is time-consuming, but you also run the risk of making mistakes, and running processes like periodic KYC based on risk level becomes a nightmare. Having your risk matrix directly embedded in your compliance tool will help you forget about it completely while making sure that it is always up to date.

Embed sanctions and PEP screening: Choose a platform that integrates sanctions and politically exposed persons (PEP) screening capabilities rather than relying on a standalone tool that would require you to copy-paste information. This will give you a unified audit trail and using ongoing monitoring to be notified if new alerts come up will be easier.

Implement automated ID and document verification: While automated identity verification technologies have become more common, they are still under-used by investment firms who don’t always have a tech team to integrate those solutions properly. Your compliance teams have already plenty of urgent tasks. Avoiding manual verification of identity documents will save them precious time.

Improve communications: You should avoid using emails to request documents from investors. Should an additional document be needed, simply request it with a single click instead of having to manually write an email and receive it as an attachment. Streamlining this process will save you a huge amount of time, improve data security, and make a more pleasant investor experience.

Efficiently collaborate with other stakeholders

The investor onboarding process usually requires collaboration between the front office and the back office, between investor relations and legal or compliance. Making sure everyone has access to an up-to-date source of truth can go a long way to speed up the process.

Make sure everything is logged: One of the benefits of using a single platform for your compliance and onboarding is that all interactions between team members can be tracked. The ability to add notes to an investigation, tag a colleague, and share comments ensures prompt verification.

Integrate with your other tools: Take into account a potential integration with your CRM or other tools you might use. It helps to ensure a smooth flow of information.

Have a 360 view of your investor portfolio: Use analytics to monitor the effectiveness of your investor onboarding process and have a comprehensive view of the risk distribution.

Plan for third-party access: Your firm might need to share KYC results with an auditor or a fund manager. It is important to make sure that you can provide third parties with secure access with limited permissions to avoid sharing sensitive information over email.


Automated investor onboarding and compliance is the next efficiency frontier for a lot of funds and platforms. Solutions like Dotfile make it possible, even without dedicated tech resources. Having an all-in-one solution, instead of having to negotiate with different vendors, drastically simplifies KYC automation deployment.

For more information on how Dotfile can help your firm, read our case study with Roundtable, the leading investment platform for Private Equity.

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