Fintech organisation OpenInvest has received a substantial investment from fund manager Pinnacle Investment Management as part of its latest capital-raising initiative.
In all, OpenInvest raised a total of $5.5 million in capital, with Pinnacle accounting for $3 million of the total funding received. The investment includes an agreement for OpenInvest to deploy a digital investing solution for Pinnacle.
The decision to make the $3 million investment in OpenIvest was described as a logical progression for the company by Pinnacle founder and managing director Ian Macoun.
“We want to offer an easier and more engaging way for Australia’s retail investors to access our growing network of world-class asset managers,” Macoun said.
“By investing in OpenInvest via this funding round, we are happy to support an exciting Australian financial technology company that we feel has broad application and strong growth potential.”
The capital will ensure the sustained development of OpenInvest, which will involve the hiring of more staff and will allow the organisation to continue the rollout of its investment administration technology platform.
Fund managers currently part of the OpenInvest facility include SG Hiscock, Blackmore Capital, Hamilton Wealth Partners, Wentworth Securities and Collins House Private Wealth.
OpenInvest chief executive Andrew Varlamos described the fact Pinnacle had decided to invest in the business as exciting.
“We have a huge amount of respect for what Ian and his team have built at Pinnacle, with affiliates delivering consistent outperformance and now managing in excess of $90 billion. We look forward to deploying an engaging digital solution for Pinnacle so that they can reach an even broader audience of Australia’s retail investors,” Varlamos said.
According to Pinnacle director and head of retail Rasmin Jajoo, being part of the OpenInvest platform will significantly help consumers in an environment where access to financial advice is becoming more difficult.
“With the introduction of increased regulation post the Hayne royal commission, the exit of the major banks from the wealth management sector and the ongoing reductions in the number of licensed advisers, there is a growing ‘advice gap’ in this country,” Jajoo said.
“There are many Australians who would like to access professional investment assistance but find it too costly to obtain personal financial advice. OpenInvest’s technology will enable us to more readily help these retail consumers access our funds management expertise.”
OpenInvest recently launched its OpenWealth arm specifically designed to bridge the advice gap the Australian market is currently experiencing.
