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Covercy

Covercy’s FinOps Hub Unifies Real Estate Investment Management, Enables Disciplined Growth for GPs

CRE investment is picking up steam after a few slow years.

Covercy saw more fundraising among its real estate investment customers in the last eight weeks than in the entire year leading up to that time period. Whether this uptick is due to lowering interest rates or general industry tailwinds going into 2025, GPs are in growth mode, and Covercy’s new FinOps Hub is the perfect tool to enable disciplined growth in a market that’s destined to become even more competitive. We spoke with the Covercy team about how their FinOps Hub gives users an edge.

A Proliferation of Systems

One of the biggest challenges that GPs face today is the overwhelming number of new fintech tools, each of which solve a single problem without taking into account the overall investor relations and banking ecosystem.

“There are thousands of different tech options out there,” says Colin Rau, Director of U.S. Sales & Customer Success at Covercy. “When you have a group that’s so used to doing things on spreadsheets and sending out checks, it’s really tough to get a grasp on the right solutions.”

GPs might be looking at different solutions for accounting, banking, investor relations and property management. Even focusing on a single task such as fundraising, a GP might be using one tool for marketing emails, a second to qualify investors, a third to get documents signed and a fourth to bring in payments. Add all of these to the spreadsheets a GP uses to handle their reconciliation work, their payment system for vendors, and of course their accounting, distributions, and property management systems, and one can create an “overwhelming” tangle of systems with a massive potential for errors.

Last time we spoke with Doron Cohen, Founder and CEO of Covercy, he told us how the company evolved from a payment system into an investment management solution. Now, Covercy is bringing all these various systems together into one cohesive whole. 

“The true appetite is for consolidation,” he explains. “We took this new technology that enabled the access to banks and to automated payments and to the data and we connected it into our investment management platform.”

Creating Efficiency With FinOps Automation

The key innovation that made financial operations automation possible was open banking. Simply put, open banking gives APIs access to bank data and transaction execution, giving mid-size GPs access to solutions that were previously reserved for large enterprises that could dedicate resources to creating bespoke in-house solutions.

“What we’re seeing in real estate, and across all industries, is this really fast move into what’s called an embedded finance model,” says Cohen. For example, Quickbooks evolved from a simple accounting platform for small businesses into an embedded financial services platform where users can not only record an invoice, but pay that invoice and borrow money to cover that payment.

Traditionally, it has been incredibly difficult for GPs to manage dozens or hundreds of bank accounts across different properties while ensuring that all their books are balanced and that accounting is handled correctly, all while providing a good experience for investors. To address those issues, Covercy built a new financial operating system for real estate investment management that integrates their investment management system with the banking and payment services that they use, creating one interconnected platform.

“Where it becomes interesting is when the banking connects to all the other tools you’re using, and that’s where Covercy can be very helpful,” says Rau. “What was important to us is that it is faster, more automated and, ultimately, really easy to use. Of course, we also have to make sure that it is as secure as possible, so investors are confident that their funds are being managed safely and efficiently.”

How Covercy is Leading the Way

Covercy’s FinOps Hub lives at the heart of all the various processes and systems that a GPs uses to get their deals done, from banking to fundraising to investor management to property management and accounting to distributions. If a GP needs to open a bank account for a new deal, they can open it in minutes within the portal. As added security, the accounts opened through Covercy’s platform benefit from $3 million of FDIC coverage per legal entity, which is $2.75 million more than the standard.

“Covercy’s FinOps Hub has been transformative for our business. By streamlining fundraising, banking, and investor management into a single platform, we’ve been able to provide a more efficient closing process for our investors while also increasing the accuracy of capital reporting. Covercy is leading the market in providing innovative solutions by listening to real estate developers and investors, and our business is benefiting from that collaborative partnership.” Jim Boland, Partner, Chief Operating Officer at PCP.

“We also speed up the process of actually taking in funds significantly by allowing GPs to receive capital through the platform,” says Rau. Because every dollar is tracked across the platform, the traditionally lengthy reconciliation process is completely eliminated. “We’ve got everything matched and time-stamped, so we know who paid how much and when.”

GPs can use Covercy to drive investors through the entire fundraising process, which means generating engagement, qualifying investors and setting up e-signs for signature. Covercy also enables GPs to link all of their external bank accounts, so they have complete insight into all of their transactions and account balances. The main goal of this system is that anybody on the GP side, whether it’s someone in management, accounting or investor relations, can look at the platform and easily see what has happened or what needs to be done.

Every step is tracked and accounted for, and it’s an easy button-click process, which is increasingly important in a competitive fundraising market where people expect technology to make the investment process fast, efficient and frictionless.

“The better the experience GPs can provide their investors, then the more successful they’ll be in their fundraising efforts and, in general, in their Investment,” says Rau. “You could have the best deal in the world, but if the investors are not confident in the process and if you can’t get them from point A to point B, then it doesn’t matter how good the deal is.”

FinOps offers clear benefits in lower costs, higher returns, the ability to act more quickly and make better decisions with fewer mistakes. 

“Once you have this single system in place, then you get a secondary benefit from having centralized data, which creates more control, and again, more automation,” says Cohen. “You can give better service and better overall experience to your investors.”

Always Evolving

Covercy is continuing to find ways to leverage new technologies to further improve on connectivity, integration and automation within its FinOps Hub. For example, the company is planning to add another major dimension to its platform next year that enhances connectivity between property management, investor relations and investor management. Covercy also plans to introduce same-day ACH payments and better banking dashboards.

“Our vision is that anything a GP is going to do will either be on Covercy or integrated with Covercy,” concludes Cohen.

To learn more about how Covercy’s FinOps Hub can streamline your real estate investor business, click here.