Capitalizing On The JOBS Act: How To Market Hedge Funds To UHNW And Family Offices

Capitalizing on the JOBS Act: How to Market Hedge Funds to

UHNW Investors and Family Offices

with

April J Rudin and Hannah Shaw Grove

August 21, 2013

Wealth Marketing Experts

• Intended to create jobs, alleviate tight credit markets and create access to capital

• Instead it lifted the general solicitation ban for private placements

– Advertising and other marketing activities– Crowd-funding– Third-party accreditation portals

• Hedge funds can engage with clients and potential investors in new, more effective ways

What is the JOBS Act? Is It a Law?

UHNW

Inner Circle

Family Offices

Advisors

Strategies for Breaking through to the Ultra-Affluent

MFOs

SFOs

How Funds Market Today Doesn’t Address Range of Accredited Investors

TOOLS•Track record•Pitch books•LP communications•Offering documents•Fund/Market commentary

Employees(salaried or equity)

Third-Party Marketers

Cap IntroProfessionals

Investment Consultants

Referrals

MFOs

One-to-One Introductions vs. Newer, Amplified Platforms for Visibility

74.6%YES

Source: Beyond Performance, N=68

25.4%NO

Marketing Specialists say their networks are exhausted in < 1 year

• Brand awareness• Advertising• Media relations• Websites and digital media• Social media• Thought leadership• Conferences and events• Newsletters and communications

Generalized Solicitation Opens Opportunity for Marketing Activities

Accredited Investors are a Broad Market

They Think Differently From Each Other…

Referential Group

… and Rely on Different Resources for Guidance

Third-PartyMarketers

Primary Intermediaries

Media Personal Research

History

Source: The Sky’s the Limit

Opportunistic Credit

Generating alpha…King Street Capital Management

Renaissance Technologies

Event Driven

Goldman Sachs Asset Management

We will use this period of higher volatility…

Baupost Group

Long-Short Equity

Paulson & Co

Soros Fund Management

Our sector expertise and understanding of financial markets…

Och-Zif Capital Management

Bridgewater Associates Equity Special Situations

Ways to identify and mitigate risk exposure…

We focus on risk analytics…

Millennium Partners

We identify smaller, undervalued companies…

Moore Capital

We have a unique, proprietary process…

DE Shaw Group

Global Macro

Convertible Arbitrage

Multi-Strategy

Market Neutral

JP Morgan Asset Management

Wellington Management

BlackRock

Corporate Website

Pitch Books & Client Presentations

Reports & Updates

Newsletters

Thought Leadership

Press Release

Online Trade Journal

Print Publication

Twitter

LinkedIn Profile

Blog

Conferences

Client Events

• Transparency & authenticity• Smaller is better• All mobile, all the time• Doing well by doing good• Don’t trust “suits”• Impact & affinity investing• Globally networked• Diminishing value of track records

Next Gen Wealth Has Its Own ValuesA different process with different messaging

Branding X X X

Advertising X X

Websites/Digital X X

Media Relations X X X

Social Media X

Thought Leadership X X X

Conferences X X

Events X X X

Newsletters X X

Communications X X X X

What Is the Right Mix for Your Fund?

Business Decisions AheadOne of three scenarios face hedge fund firms

Maintain Reallocate Invest

Common Objections & QuestionsPerceived obstacles to proactive marketing by hedge funds

• The fund is already closed (or at capacity)• Our company is very small, no marketing and sales people on

staff• We don’t have a marketing budget• Won’t advertising and PR attract the attention of the wrong

people?• How can my marketing efforts focus on accredited investors

only?

Seek Professional Advice to Reverse Public Perception

HNW Advisory BoardEducational Support

HFA Marketing Survey

Answers and Insights for HFA members

April: [email protected]

@therudingroup

Hannah: [email protected]

www.hsgrove.comwww.pw-mag.com