According to recent data, firms spend between 20-50% of their operating expenses on investment operations and financial administration. In this volatile market, such an expenditure is a luxury they simply can’t afford.
Now, more than ever, real estate firms are looking for a true software/service combination to enable them to stay lean and cut up to half of these expenses, while maintaining their ability to raise capital, manage investor relations and handle the financial administration that goes with it.
We discussed Agora’s solution to this urgent need in our first interview with Agora’s founders. In the meantime, Agora, now enabling customers to effectively manage a total of over 60B in AUM and 20,000 investors with its software, expanded its service offerings to accommodate the growing demand.
That is why we returned to Agora’s CPO Lior Dolinski and Head of Financial Products Shepsi Berkowitz, for another exclusive interview. They gave us insight into how Agora has been expanding the scope of the platform and augmenting the technology with additional service layers to more holistically support real estate investment managers.
What Challenges Does the Industry Face in 2023?
The real estate landscape is definitely different than it was a year ago. With the change in market conditions, most firms are looking to be as efficient as possible. And many of those desired efficiencies can be found with technology.
Agora’s software solution allows real estate firms to streamline operational processes and avoid wasting time performing those processes manually. And because the software is simple and easy to use, it helps firms rapidly optimize their operations.
Recently, through interacting with clients, another opportunity to add value emerged.
Berkowitz noted, “Through our client conversations, we figured out that most GPs have a strong need for help on the back-office side of their businesses — in the real world, outside of the software.”
So the Agora team created services and financial products that leverage Agora’s technological advantage to deliver back-office support for clients.
“We see Agora as a convenient all-in-one solution that bundles technology and services into an efficient, affordable package,” Dolinski explained. “The software is just a start.”
Agora’s New Suite of Services For Real Estate Investment Managers
Most GPs want to focus on connecting with investors, finding new deals, and generating profits. Unfortunately, they’re often bogged down with manual, tedious operational tasks. Agora has created a full suite of services and technology features to eliminate those tasks from GPs’ to-do lists.
A Better Solution for Taxes and Accounting
Most general partners dread tax season. One of the main reasons is the arduous process of gathering the necessary information for all their investors. They require addresses, social security numbers, investment amounts, and more — and they spend hours upon hours tracking it all down for their CPA.
Because the CPA is in charge of creating and filing the K-1s, the GPs don’t have any transparency into the progress. So when investors ask for a status report, the GP has no idea what to tell them.
The Tax Center
Since half the problem with filing the reports is gathering information, Agora saw an opportunity to streamline the process for clients.
How? Well, most of the investor information that real estate CPAs need is already stored in the Agora platform. With the information at their fingertips, the CPAs can create a file with the information in the exact format needed to file it to the IRSs, thus eliminating 50-60% of the labor and time they would typically spend.
Plus, Agora created a collaboration tool within the platform called the Tax Center that gives investment managers complete transparency into their tax process. GPs, CPAs, bookkeepers, and other team members can all access the Tax Center and communicate, upload documents, and sign forms. The progress bar feature gives a visual progress score (from 0 to 100) to let parties know how close the reports are to completion.
Agora’s K-1 Services
For customers that want total tax support, Agora recently announced its K-1 Services. Instead of collecting information, sending it to your CPA, waiting for K-1s, then sending them to (up to hundreds of) investors or LPs — Agora takes care of everything.
The company works with several hand-picked and vetted CPA firms with real estate expertise to ensure accurate filings and industry-leading service. Investment managers simply communicate with a dedicated CPA, send and sign documents, chart the progress within the platform, then sit back as Agora sends K-1s to investors — all at about half the cost of a typical CPA firm.
Also, because the Tax Center enables streamlined communication, the entire process is complete within 14 days of when Agora’s CPA receives all the documents.
Solving the Bookkeeper Shortage
In addition to accounting assistance for tax season, Agora also identified a need for quality bookkeepers to track finances throughout the year.
Berkowitz said, “Our customers told us that a huge pain point for them is the shortage of bookkeepers with real estate knowledge – especially in the U.S.”
Agora’s bookkeeping service works hand in glove with the tax service and brings clients an in-house team that can handle all necessary functions, such as accounts payable, accounts receivable, and account reconciliation. With various service options, clients get exactly the scope of service they need.
Payments Can Be Easier Than Ever Before
Another pain point for General Partners is managing and distributing quarterly payments across hundreds of investors.
Until now, it’s been a cumbersome process involving: calculating payments for each investor, creating professional reports, sharing documents, and processing payments from the bank, manually or by using a NACHA file.
Convenient Distribution Payments via ACH
With Agora, GPs can distribute payments efficiently and painlessly directly from the investor relationship management software, via ACH transfers.
The platform itself helps investment managers calculate payments, create professional reports, and send the reports to LPs.
Dolinski elaborated, “Investment managers can click one button to calculate payments, another button to create beautiful reports for hundreds of investors, then another button to distribute the reports. That alone saves weeks of hard work every quarter.”
Agora takes it a step further by actually processing the payments directly from the platform. The company’s unique solution allows GPs to initiate payments (via ACH transfer) with the click of a button from the same dashboard.
Plus, Agora is the first investment management software to accomplish seamless bank integration for processing payments, which offers benefits like:
- Bank-level security
- Bank-level risk management
- An error-free environment
- Superior user experience
- Lower fees
- The potential for more complex financial products in the future
It’s the fundamental change in what is possible for software-enabled distribution payments.
International Payments, Too
In addition to domestic distribution payments, Agora also eases the burden on GPs for international payments. Typically, firms run into issues like:
- Complications due to currency exchange
- High bank fees
- Regulatory issues
With the company’s international distributions service, an Agora team member will process the payment, streamlining the arduous process for GPs.
“Done for You” Back-office Operations
Finally, Agora offers a 360° Deal Management service that gives clients the option to be completely hands-off on back-office operations. The service provides an ongoing relationship with Agora’s customer success team, which manages all day-to-day operations.
With this service, real estate professionals can focus on building relationships and closing deals. Agora will handle the rest.
A One-Stop Shop for Real Estate Investment Managers
Eliminating manual processes and allowing investment managers to do more of what they love has always been the inspiration behind Agora.
With this new suite of services, Agora is setting itself up as a one-stop shop for all real estate investment operations and back-office needs. These services enable GPs to cut costs, have leaner operations, and maximize profits.
“Our technological edge, real estate domain expertise, and award-winning support really position us to provide an A-Z service for our real estate customers.”
If you’d like to learn more about Agora’s full suite of software solutions and services, click here.