The time will be upon you before you know it. It’s a scenario that likely sounds all too familiar.

The calendar flips to the new year… and within weeks, if you’re lucky (or days if you’re not), your inbox and phone lines light up with investors clamoring to access their K1 Distribution tax forms. You know you still have weeks or months ahead, juggling between your financial systems, internal teams, and accountants to get the required information in hand. Only then is it time to begin distributing the documents to your investors.

For many CRE investment firms, the process is laborious. It involves a patchwork of spreadsheets, file-sharing applications, even snail mail. Lack of automation and integration with these disparate systems adds unnecessary complexity to what is already a formidable task.

While this is a common headache, there is a cure for what ails you. Welcome to the simplicity of online tax document distribution via CrowdStreet’s investment management software.

Encore Enterprises Takes the Upper Hand on K1s (and Investor Management)

Encore Enterprises, Inc. is a commercial real estate investment firm with a portfolio of multifamily, hospitality, office, and retail single assets and funds. Since 1999, Encore has completed over $2.4 billion in transaction volume.

Given its need to manage more than 1500 investor positions, the company was already evaluating online investment management solutions–one of which was CrowdStreet’s investment management software Having made lackluster forays into online fundraising as a source for new capital streams, they were attracted to the one-two punch of investment management software and CrowdStreet’s online investment marketplace. Once the new tax season loomed near, they decided it was time to take action.

In addition to raising $10.5M for their first offering inside the platform, Encore improved internal efficiencies and customer satisfaction around K1 distributions. They also enjoyed the one-stop repository of historical documentation for investors and transparency across the organization for internal use. With some positions going back as far as 10 years, having materials available on-demand during scenarios such as audits was a big bonus.

“Thanks to investors’ experiences investing online through companies like E*TRADE and Vanguard, the bar is high for expectations around online financial management,” said Ben Zang, Head of Client Success, CrowdStreet. “Investors expect quarterly financial reporting and timely delivery of tax documents each year. As such, sponsors need solutions that are turnkey and integrated. We feel proud to provide an overall technology platform that customers tell us hits on all cylinders.”

The Benefits of Digital Distributions via CrowdStreet software

  • Flexibility: Common solutions for K1 preparation vary as greatly as the types and sizes of CRE investment firms. These include shuffling data between spreadsheets and QuickBooks or Enterprise solutions like Yardi or MRI. CrowdStreet meets a variety of needs with document management options that match your financial and accounting back-end. You can also provide your CPA with log in to complete the document fulfillment process.
  • Improved Communication: Provide investors with an estimated date for K1 completion right inside their profile for each investment and reduce incoming inquiries out of the gate. Once completed, you can distribute documents via emails with secure links, and investors can download all tax documents into .zip files or other options.
  • Eliminating Redundancies: You may choose to use CrowdStreet as your record of note for all investments. Manage the entire investment management life cycle, from initial investment through the final return of capital for all investor positions.
  • Security: K1s contain sensitive data you must guard for your investors at all costs. Sending files via snail mail, email attachments, ShareFile or Dropbox, and other platforms all create exposure you can’t afford. Instead, choose a fully secure, private investor portal which includes the IRS-required Electronic Consent built directly into the platform. Investors can also provide their tax advisors direct access to their documents to further secure their personal data.

Customer Delight: When you evolve from stuffing envelopes and filling Dropbox folders one-by-one to a quicker, turnkey online solution for K1 distribution, the outcome is simple: satisfied investors. It’s yet another way the CrowdStreet platform allows you to show your investor community that their needs and success are priority number one.

Tax season is just around the corner. But it’s not too late! The CrowdStreet team can get you up-and-running with an end-to-end solution for investor management and K1 distribution in time to beat the buzzer.

So, why not keep your investors happy, and yourself out of the hot seat, with K1 distribution through CrowdStreet’s investment management software? Ask us how.