Translating Opto into English (for engineering types)
Our website is designed for consumption by our clients, who are sophisticated financiers (and the occasional wayward soul seeking a snowboarding excursion). So, we frequently hear from engineering candidates that they don’t really understand what we do.
What about this don’t you understand </snark>?
You can ask ChatGPT for a summary of what Opto Investments does, but you’ll be parsing apart more jargon. So let’s give you some help!
Who our customers are
Our primary customers are investing on behalf of their own customers as:
Registered Investment Advisors (RIAs):
Firms that provide financial advice and investment management services. They are registered with regulatory bodies, such as the SEC (Securities and Exchange Commission) and are legally obligated to act in the best interests of their clients (“fiduciaries”).
Family offices:
Private organizations that manage investments and financial affairs for high-net-worth families. They offer a range of services, including investment management, estate planning, and tax services.
We assist them in investing in private markets - which simply means dealing in securities that are not listed on public exchanges. We’ll ignore the nuances for now, but they’re investing in, among other things:
Private markets attract investors for several reasons:
Risk management:
Private markets assets typically have low correlation with public markets, offering diversification that can help mitigate risk in an investment portfolio by spreading exposure across asset classes and economic cycles.
Access to unique opportunities:
Investors can gain exposure to exclusive deals and niche markets that are not available in public markets - often more direct influence over the management and strategic direction. Examples include: startups (venture capital), distressed assets (private credit), large infrastructure projects with government backing.
Higher potential returns:
Because of the uniqueness of private markets deals, combined with active management, managers in private markets have the opportunity to generate returns in excess of passive public market indices. Private markets investments provide a wider distribution of potential outcomes, commonly referred to as “dispersion.”
What Opto does
Private markets are complex, and there are some inherent challenges that we can’t address with technology:
- The potential for higher returns usually comes with higher risk
- You typically can’t access your capital for years (illiquidity)
Fortunately, we’re a tech startup and there are many challenges we can address, such as:
Improving investment selection and management
Private markets investment selection benefits from specialized knowledge, rigorous due diligence, and access to deals via your network of connections. This presents a significant barrier to entry that dissuades investors from finding opportunities that are worthwhile for their clients’ portfolios.
Opto improvements include:
- Pre-vetted funds and analysis tools to reduce research time for advisors
- Extracting data from unstructured and semi-structured sources, such as PDFs and Powerpoint decks, to enhance what is otherwise a sparse and/or poor quality datasets. This helps investors make more informed decisions
- An extensive network and ability to aggregate capital to help investors potentially access otherwise hard-to-access funds
- A user-friendly, client-branded platform that organizes information and helps tell a story about investment performance and opportunities to people with a wide range of private markets sophistication
Reducing the administrative burden aka paperwork
Investing in private markets involves a heap of intricate paperwork, and right now the only option if you want scale is to hire a legion of (fallible) humans to do it. These onerous tasks include document management, executing massive legal documents (subscription documents) that are signed when clients invest in a fund, regulatory compliance tracking, and tax reporting.
Opto automates and centralizes administrative tasks across the entire lifecycle of an investment, shifting the operations burden to machines (who love rules, consistency, and scale endlessly) while allowing humans to do creative tasks (e.g. strategic decision-making, client relationships) more fitting for an organic species.
Favourable business model for partners
In addition to the tech-centric benefits enumerated above, we made the alignment of Opto’s interests with our clients a core part of our value proposition.
- Our fees are typically structured so that Opto does well when investors do well on their investments
- We also frequently invest our own capital alongside clients
The opportunity
If you’re excited about using your technical skills to make a dent in a $15 trillion industry, we’d love to hear from you. Visit our careers page to learn more about current opportunities.
For disclaimers, please visit our disclaimers page.