Caliber: Making the Most Out of Marketing and Public Relations

Oct 5 2016 | 7:09pm ET

Editor’s note: It has likely never been harder for small to medium-sized alternative investment firms to grow their assets, given perceptions of poor performance, high fees and a propensity for investors to place ever-increasing amounts of capital in the hands of a narrow group of colossal money managers. This environment is forcing many funds to rethink the marketing, communications and PR aspects of their business – areas that have traditionally been downplayed, if not outright ignored, by the vast majority of hedge funds and PE companies. Harvey Hudes and Grace Keith of Caliber Corporate Advisers are at the forefront of this transformation, utilizing decades of PR, communications and finance experience to help alternative investment managers understand the need for a more proactive approach. FINalternatives caught up with Harvey and Grace to learn why an articulated, on-message communications and marketing strategy is increasingly paramount to winning allocations and scoring exits. 

Q: Are certain types of financial firms focusing more on public relations and marketing today versus a few years ago?

Harvey: Yes, absolutely. With more attention being paid to emerging startups and the pressure of finding the next unicorn, we’re seeing PE and VC firms increasingly playing a role across the marketing and public relations (PR) functions within their portfolio companies. A similar trend is happening within smaller hedge funds as they are coming around to the realization that days of conveying exclusivity and secrecy through an address-only landing page are essentially over. In both cases, ignoring marketing and PR is to the firm’s detriment given the increasingly competitive environment. 

Within private equity and VC, investors are feeling  and often times applying  more pressure for companies to be more visible and present in relevant media outlets. The value of the megaphone that comes along with a CEO comment or company data being featured in mainstream and industry trade media outlets is becoming more obvious to these firms. At the same time, the media is stepping up its focus on the private company space as huge, high profile companies like Uber and Airbnb choose to remain private longer. This has created a larger appetite amongst journalists to hear from and about these companies, as they could be the next big thing or – on the contrary - the next big bubble to burst. 

Q: ‘Marketing’ means something different in the hedge fund space than other industries? Can you explain?

Harvey: In the hedge fund space, when you see marketing in someone’s title, it signifies that they are tasked with raising money for the fund. They essentially serve in an investor relations capacity. 

However, in any other industry, the term marketing typically means that a person is tasked with promoting the brand, values and message of the company more broadly. Traditional marketing tactics can range from creating & distributing regular content – think quarterly newsletters or blog pieces – to interviews with media outlets like CNBC on-air or quotes in The Wall Street Journal. 

While the definition of “marketing” may mean two different things for hedge funds, it’s important to have both marketing functions working in sync with each other. Astute hedge funds are driving new investor interest while also using content and traditional marketing tactics to raise awareness about the fund’s brand, strategy, approach and leadership. 

One trend gaining momentum in “traditional marketing” is the development of a robust content strategy and calendar to help capture the expertise and essence of an investment manager through written form – things like articles, blogs or newsletters. While this used to be relatively rare, today many funds publish monthly or quarterly “letters”, often under the guise of communications intended specifically for their investors, that find their way to the general public. Managers such as Doubleline’s Jeff Gundlach and Third Point’s Dan Loeb are good examples of managers who have embraced the philosophy of proactively getting their information and opinions out there. 

Q: What are some of the emerging topics that attract financial media coverage today?

Grace: With the regulatory environment around the globe continuing to evolve – both on a regional and international scale – journalists are showing interest in exploring the regulatory implications for financial firms. They’re looking to find out how firms are adapting to the changing market and increasingly complex regulatory environments, and where technology can or should play a role. “RegTech” (regulatory technology) and how financial firms are using it to streamline processes and resources has become one recent area of interest for financial journalists.

Q: What are some of the primary reasons asset managers would rely on outside advisers for PR and marketing support and guidance? 

Grace: We believe investment managers have their hands full just taking care of portfolios and minimizing risk. They’re experts in that area of the business, but often have little experience in what we do – marketing and communications strategy. Just as an equity manager would typically not start trading credit derivatives without bringing in a person with knowledge and experience in that area, so too should they rely on experts in this area. 

A few examples can help illustrate our point. In one instance, we were able to use PR to help a mid-size asset manager go from being a subsidiary of a parent company to a standalone brand following the financial crisis. By leveraging our network with the media and telling their story in new, innovative ways, we ensured their CEO was regularly quoted in influential business publications and featured as a frequent guest on CNBC. With this approach, we were able to help them establish a separate brand from their parent company, which resulted in increased awareness among clients and potential acquirers. 

In a different scenario, we were brought in to help launch a new hedge fund in the U.S. With this client, we advised on everything from brand messaging to their go-to-market media outreach. By introducing the fund’s leadership as experts in their market niche (private lending), we were able to take advantage of journalist interest in this developing space and got the firm’s name visible in the press. This strategy was effective in ensuring that when they walked in the door of a new prospective investor, they were one step closer to educating him or her about who they were and what they did. 

Whenever you can walk into an investor’s office and have them immediately recognize your company’s name, you’re a major step ahead of the game – especially as an early stage fund trying to grow assets.

Q: What do you think is the primary driver behind the increased interest in PR and marketing strategies?

Harvey: There was a time when hedge funds in particular perpetuated an air of secrecy around what they did. It was touted as a way to keep prying eyes from a fund’s strategies and techniques, but it also helped with the mystique of the alternative investment industry and partly justified, in our view, the sector’s relatively high fees. However, those days are fading fast; since the financial crisis, a new generation of investors simply expects greater transparency. These investors are now much more familiar with the basic structure and approach of hedge funds, so there is less to be mysterious about. At the same time, weak performance has led many investors to play it safe and stick with huge funds with billions in AUM, which in turn means the competition to raise capital is more intense than ever. 

Add it all up, and fund managers are realizing that an underutilized weapon at their disposal is marketing and PR, and the ones that get it right are ultimately the ones that will grow.

In Depth

Fundraising for Mid-Sized PE Funds: Should You Use a Registered B/D?

Dec 6 2016 | 7:18pm ET

When does a fund sponsor need to use a registered broker/dealer when raising capital...


Trump Attends 'Villains and Heroes' Costume Party Dressed As...Himself

Dec 5 2016 | 11:16pm ET

U.S. President-elect Donald Trump attended a "Villains and Heroes" costume party...

Guest Contributor

Investor and Warehouse Lender Confidence Key to Fueling Marketplace Lending Growth

Dec 16 2016 | 4:44pm ET

Marketplace lending activity has ballooned in recent years as investors have sought...


From the current issue of

Barron’s ran an intriguing feature in an August issue titled: “Options Funds for a Nowhere Market.”