Eric Satz soon realized there was a problem. The year was 2014 and he was trying to use his IRA money to make an equity investment in a private company. He discovered it was legal, but his current custodian couldn’t help him. He went looking for someone who could.
After weeks of research, he found a couple of companies that said they could do it. He chose one. The process was clunky and slow and aggravating. He managed to make the investment, but it took eight weeks, dozens of pages of faxed documents and a lot of expletives. Eric did most of the work himself, but the custodian still ended up with their same asset “management” fees and, for an administrator, they were not that helpful. So, the idea for Alto was born.
I caught up with Eric and his team last week in advance of the big announcement they are making today.
Alto calls itself a next-generation self-directed IRA platform and its focus is on making it quicker and easier for individuals to invest in alternative assets through their IRA. I opened up my own Alto account earlier this year (before I knew they were working with LendingClub) when I decided to make investments in Masterworks and FarmTogether.
I can attest that the process was simple (or as simple as a self-directed IRA can be) and I appreciated the fact that I could do everything online. There was no need for sending PDF documents back and forth, no need for phone conversations, it was an online experience that was the best I have encountered in the self-directed IRA space.