SAN FRANCISCO--(BUSINESS WIRE)--Flow, a leading provider of private market software solutions, today announced the close of a $20 million Series A round led by SVB Financial Group, the parent company of Silicon Valley Bank. Frontier Ventures, GFR Fund, HOF Capital, L’Attitude Ventures, WOCstar Fund, Mantis VC and several other investors also participated in the oversubscribed round.
Flow simplifies fund formation and management with its transformative infrastructure software, which provides a platform for unrivaled insights, transparency and dialogue between fund managers and the broad ecosystem of investors, law firms, fund administrators, banks, and accounting firms.
“The volume, pace and complexity of fund management is setting new records. By bringing Flow to the multi-trillion dollar asset management market, we aim to reduce barriers to entry, modernize processes and empower all players in the ecosystem to increase the speed of their decisions, capital deployment and growth,” said Brendan Marshall, co-founder and CEO of Flow. “We are thrilled by the response from the private markets. By removing the taxing overhead of today’s archaic infrastructure, Flow will further accelerate the development of more open, inclusive, innovative and efficient market-based economies.”
Capital raises from private markets have outpaced those from public markets in each year since 2009. In 2017 alone, companies raised $3.0 trillion in private markets and $1.5 trillion in public markets. Remarkably, in the short span of three years, total capital raised from private markets more than doubled, surpassing $7.4 trillion in 20201 according to a recent McKinsey & Co. study. This surge of capital has been coupled with a rapid increase of new investors, new fund managers and new fund strategies that show no signs of abating. These trends have overwhelmed the outdated infrastructure supporting funds and become the catalyst for all stakeholders to adopt new technologies, like Flow.
“A key pain point for many of our investment manager clients is the lack of a simplified, flexible platform to connect fund managers, general partners, limited partners, fund admins and law firms to create, raise and manage special purpose vehicles, venture capital and private equity funds,” said Jim Marshall, head of SVB’s Emerging Manager Practice. “Flow’s platform streamlines the complexity of fund infrastructure, and we are proud to support their growth and expansion plans.”
“Flow modernizes and significantly expands an already massive market,” said Kennie Blanco, Managing Partner of L’Attitude Ventures (LAT VC), which invests in early-stage US Latino founders and entrepreneurs. “We share Brendan and Adrian’s philosophy of opening markets to more participants and empowering investors, especially from underrepresented groups, as this leads to more competition and economic expansion.”
With more than $5 billion in assets managed on the platform, Flow’s open platform approach has enabled fund managers to scale from small special purpose vehicles to multi-billion dollar funds. Law firms, fund administrators, auditors and banks are increasingly leveraging Flow to solve for once tedious and error-ridden workflows related to investor onboarding and fund administration. This year, Flow is focused on deepening these relationships to further empower the innovation economy.
Flow’s ARR has grown more than 250% year-over-year, driven by referrals from the 10,000+ investors already on the platform. The company will use the funding to rapidly accelerate product development and integrated services to further empower fund managers and their investment networks of investors, law firms, fund administrators, auditors and banks.
In connection with the investment, SVB’s Jim Marshall will join the Flow Board of Directors.
Flow solves the complexity of private market infrastructure by connecting information and workflows across investors, law firms, fund administrators, banks and related systems. Today, the private markets are encumbered with antiquated systems, fragmented data and siloed processes that hinder bringing decisions to life. Flow catalyzes the capital growth decisions that drive market-based economies, and currently supports 200+ customers, 10,000+ investors and $5+ billion in assets managed on the platform. Flow was founded by Brendan Marshall and Adrian Ortiz, and incubated in collaboration with Quiet Capital and Endurance Companies. Learn more at flowinc.com.
1 Source: Morgan Stanley, Public to Private Equity in the United States: A Long-Term Look (Aug. 4, 2020)