Tag Archives: hedge fund marketing

Hedge Fund Advertising After SEC JOBS Act Vote

One of the most anticipated votes for the hedge fund industry is happening today when the SEC votes on the JOBS Act implementing regulations (for information on the proposed changes, please click here).  Presumably the SEC will allow certain private fund managers to generally solicit which means that managers will have expanded options when it comes to advertising.  This is expected to create a new category of service providers to fund managers seeking to maximize visibility.

We will of course continue to provide information on the new regulations as soon as they are released.  Below is a guest post from Mark Macias which highlights certain marketing strategies that managers might want to consider after the JOBS Act vote.


How to Prepare for the Anticipated SEC Changes on Hedge Fund Advertising
By Mark M. Macias

Most hedge funds, private equity groups and venture capitalists will be at a disadvantage when the SEC lifts the prohibition on general solicitation, which is expected to occur in 2013. The decades-old marketing ban has prevented many financial groups from developing an online infrastructure that is crucial to marketing a service to investors.

Marketing a fund with the media is drastically different than marketing a product to the public. Credibility must be established from the start before the media will even consider putting your portfolio manager on TV or quoting him as a financial expert. He may manage a $100 million portfolio, but the media is not going to take his word for it without seeing evidence of his expertise. This is why it’s so crucial for all funds to establish credibility now with a strong online presence before the new proposed SEC rules on advertising go into effect.

Here are some marketing strategies your fund should consider as it undergoes an online marketing and media campaign to reach new investors.

First – the media. Credibility matters in life, but it especially matters for journalists. Whenever a portfolio manager is pitched as an expert to the media, journalists will quietly and overtly measure his expertise, integrity and experience in the financial industry. Journalists will want to see proof on why this portfolio manager should be the best expert to add color to the market.

This is why your fund needs to establish a website now to start building credibility in the online world. If a reporter doesn’t see an online presence on your fund, credibility questions will be raised. This doesn’t mean you won’t succeed with a media placement, but it will be a much harder story sell to the media if you can’t support or show why your fund manager is an expert. You can establish credibility quickly by writing editorials on the market and submitting them to influential business news sites, like the Huffington Post, Business Insider, trade magazines, etc. Writing a book on your industry will also give you another avenue to position yourself as an expert.  Here are a few credibility questions you should be able to address and answer before your fund pursues media placements.

  • What makes you qualified to speak on this topic?
  • How many years of experience have you spent in the industry?
  • How big is your fund in comparison to others?
  • What part of your daily routine is spent reinforcing your expertise?
  • What do you know as an insider that other investors would want to know?

Once you establish credibility, how do you get the media’s attention? How do the news producers and newspaper editors decide what to print and publish? Most people ask this question like there is a magical formula that scientifically reveals whether a story should be pursed or scrapped. If it were this easy to identify news stories, you can bet the formula would have been hacked and posted on the Internet by now. The fact is news selection is an art and just like any other profession, involving creativity, opinions and experiences, it is subjective to where you stand.

News is a public service, which means your story must provide a service to the public. It sounds simplistic, but many people don’t grasp that concept. They assume the media is entitled to do feature stories on the public in the name of public service. No, the media is entitled to do stories that benefit and help the public with information that is relevant today. And in today’s saturated media market where ratings and unique viewers drive advertising rates, a story idea will have a better chance of getting picked up by the media if it has an inherent tease value. In essence, this is a story that draws readers in because they are intrigued.

One of the biggest factors that will decide whether a story makes the evening news or morning newspapers involves timeliness. News is from the root “new,” which means you must find a new and unique element to pitch if you expect the media to pursue a story on you or your fund. If your story is old news, then you need to find a new way to spin it by finding an angle that is tied to a timely matter. For example, if you are a Middle East fund, trying to get publicity in the US, tie your fund to a current event. Currently, there are protests throughout Turkey and Egypt. What are these protests doing to the stock market in those countries? How will a new leader in those countries impact the economic stability? How is the (local) currency market reacting on the international stage? Those are all questions you can pose to position your portfolio manager as an expert and in a timely manner. Here are a few questions to help you discover a newsworthy angle for your fund.

  • What is different about my fund? How does this personally relate to investors reading this publication? The more you can define it, the better your chances for a successful media placement.
  • How does my fund impacted by international events?
  • What is the timely element with my fund?
  • Is there a personal story to tell about my fund, like maybe the portfolio manager has overcome a personal obstacle or has survived through several decades of difficult financial times? What can we learn from this portfolio manager?
  • Is there a new trend arising in my field that will affect the pocket books of consumers? For example, is the rising cost of wheat starting to put a damper on profits for bagel shop or Italian restaurant owners? Will my business soon be forced to raise prices on the menus because the price of wheat keeps rising?
  • Does your fund have a direct impact on technology, materials or energy, reshaping the future? If so, what is that innovation and how will it change lives? What trend is it leading?

Finding a unique angle is not as difficult as it may sound. You just need to open your mind to timely events that impact and influence your fund. If your fund is geared towards a niche audience, like cyber security, scan the headlines in the business sections of various newspapers for possible tie-ins to current events.

The founder of MACIASPR, Mark M. Macias, has worked inside the newsrooms of NBC, CBS, KTVK, the Arizona Republic and King World Productions. As the Executive Producer with WNBC in New York, Macias approved and vetted story ideas from publicists, reporters, producers and viewers. He was also Executive Producer for a national business show that was syndicated by NBC. You can read more on his PR Firm at www.MaciasPR.com.


Cole-Frieman & Mallon LLP is a boutique law firm focused on the investment management industry.  Bart Mallon can be reached directly at 415-868-5345.

SEC Focusing on Marketing Misrepresentations

SEC v. Kapur Highlights Increased Focused of Examination

On November 10, 2011, the SEC filed in action in the US District Court for the Southern District of New York against Chetan Kapur (“Kapur”) and Lilaboc, LLC (“Lilaboc” or “t

he firm”). The SEC alleged that Kapur and Lilaboc overstated the performance, longevity, and assets of funds they managed as well as Kapur’s credentials as a manager and the due diligence procedures in place to safeguard investments.

The SEC’s complaint claims that Kapur and the firm made numerous misrepresentations in mailings, emails, postings on hedge fund websites, and marketing materials distributed to prospective investors.

The SEC asserted causes of action under Section 17(a) of the Securities Act (prohibiting fraudulent interstate transactions), Section 10(b) of the Exchange Act and related rules (prohibiting the use of manipulative and deceptive devices); Section 206(4) of the Advisers Act (prohibiting acts, practices or courses of business that are fraudulent, deceptive or manipulative), and for equitable relief.

The SEC’s complaint is available here: SEC v. Kapur.

Takeaways for Managers

The alleged misrepresentations included the following:

  • Overstating the performances of funds the firm managed, giving investors the false impression that the funds’ track records were consistently positive and minimally volatile;
  • Statements of the true inception dates of funds, routinely providing information about funds’ performances for years prior to the true creation of said funds;
  • Statements that certain individuals were involved as part of the

    firm’s management team, when in fact they were not affiliated with the firm in any way;

  • Statements that Kapur had an MBA from Wharton and had 15 years of experience in investing. In fact, Kapur only had an undergraduate degree from Wharton, and his claim of 15 years of experience in investing would have meant he began his career when he was 14 years old; and
  • Statements that the firm conducted high levels of due diligence, when in actuality the firm repeatedly failed to conduct due diligence resulting in investments in Ponzi schemes and other fraudulent offerings.

This action highlights several points for managers:

  • The SEC takes a broad approach to enforcing anti-fraud provisions of the securities laws, and managers should pay careful attention to the accuracy of the information provided in their marketing materials;
  • Do not lie in materials provided to prospective investors, including exaggerations about management qualifications, experience and funds’ performances;
  • Be sure to adhere to the procedures and policies you claim to follow; and
  • Maintain files of backup materials to document every factual statement made in your marketing materials.


Though Kapur encompasses a deeply troubling pattern of fraud and misrepresentation, the message from the SEC to managers is clear: managers should take care that the material they provide to prospective clients is accurate and avoid making claims that do not truly reflect the nature of their operations. We recommend that your attorney, in-house counsel or compliance consultant review all marketing materials prior to distributing them, and that you retain these materials and backup information in your files.


Bart Mallon is a partner with Cole-Frieman Mallon & Hunt LLP, an investment management law firm. Bart can be reached directly at 415-868-5345.

Hedge Fund Marketing – Building a Strong Brand Identity

Importance of Brand Identity Emphasized in Recent White Paper

There has been a clear trend over the last 12-18 months for hedge funds to focus on a number of operational issues in order to become more attractive to institutional investors.  While much of focus has been on the risk management side, I have seen more recent emphasis placed on brand building and image refinement.  This can take many forms of course, including making sure that your hedge fund marketing pieces look professional. However, it is becoming evident managers will need to go further and make sure their entire product offering is designed for the needs of their target investors.

In a recent white paper, produced BK Communications Group, this argument was expanded upon and discussed in depth.  The following are the overview highlights of the white paper:

  • Performance alone isn’t enough to get allocations.  Recent surveys of institutional investors find reputation has become a primary consideration when choosing a hedge fund manager.  And with institutions now representing up to 70% of hedge fund investors, the demand has increased for high-level communications that speak to a sophisticated audience.
  • A step-by-step program to build a strong brand identity – the sum total of associations people have with an organization – can help a fund manager heighten name recognition and credibility.  Professional-level materials that reflect the brand identity can position a fund to take advantage of opportunities in the institutional space and beyond.
  • A strong brand identity can also help fund managers weather severe setbacks by allowing them to draw on a reservoir of good associations already in place.
  • Managers often underestimate the importance of marketing communications, and can be misinformed about what they are allowed to communicate.  Many lack the internal resources or capability to effectively build a brand identity and get their message out across a spectrum of materials and media.

While many in the industry understand that performance is not everything, many managers do not believe this (…for some managers, growth is an offshoot of fantastic performance, see David Einhorn, but this is not always the case).  I think that this paper presents important information for such managers.  As the industry continues to become more instiutionalized, I believe we will see a greater emphasis placed on brandbuilding and I believe consultants will play a larger part in the investment process (including helping the manager to complete the due diligence process).

For the full white paper, please see: BKCG White Paper: Brand Identity for Hedge Funds


Please contact us if you have a question on this issue or if you would like to start a hedge fund.  Other related hedge fund law articles include:

Bart Mallon, Esq. of Cole-Frieman & Mallon LLP runs the Hedge Fund Law Blog.  He can be reached directly at 415-868-5345.

Raising Hedge Fund Assets | New Market Requires New Strategies


As part of our ongoing discussion on how to raise assets for hedge funds, today we have another guest post from Karl Cole-Frieman who specializes in providing legal advice to hedge funds and other alternative asset managers.  Mr. Cole-Frieman specializes in Loan Trading and Distressed Debt Transactions, ISDAs, Soft Dollars and Commission Management arrangements, and Wage and Hour Law Matters among other legal matters which hedge fund managers face on a day to day basis.

The article below details the strategies which hedge fund managers should consider when creating a marketing strategy for their fund.


AWAI Panel: How Growing Funds Can Beat the Odds in the “New” Market

By Karl Cole-Frieman, www.colefrieman.com

On September 24, 2009, we attended a panel organized by the Association of Women in Alternative Investing, and sponsored by Pillsbury Winthrop at Pillsbury’s offices in San Francisco.  The panel consisted of several extremely experienced hedge fund professionals and was moderated by Angela Osborne, Senior Director of Global Cash & Derivatives Operations at BGI.  Prior to joining BGI, Angela was Head of West Coast Client Service at Morgan Stanley Prime Brokerage.

The other panelists were:

  • Nicole Civitello, Capital Introduction at BNP Paribas.  Nicole was formerly at Bank of America Prime Brokerage in New York and San Francisco (BofA Prime Brokerage was sold to BNP in 2008).
  • Ildiko Duckor, Counsel at Pillsbury Winthrop.  Ildi had previously been Counsel at Howard Rice, and has represented hedge fund managers for many years.
  • Robin Fink, Head of Prime Brokerage Sales at Jefferies & Company, Inc. Jefferies has been aggressively increasing its market share in prime brokerage, and Robin has been leading that effort on the West Coast.

The panel began with an overview by Ildi Duckor regarding proposed regulatory changes relating to the hedge fund industry.

Develop a Strategic Marketing Plan

The discussion then moved to ideas for successful marketing, and we thought the panel’s insights were useful.

Nicole Civitello emphasized developing a strategic marketing plan.  She made the following points about developing a plan:

  1. Targeting the right investors.  For example, start up managers should not target corporate pensions and other investors that will require a lengthy track record.  Instead, start up managers should look to friends and family investors and family offices for initial capital.
  2. Understanding the investors.  Managers should research potential investors the same way they research investment ideas.  They can use their personal network or capital introduction resources for help with this.  Robin Fink added that managers should do their homework to understand an investor’s strategy.
  3. Invest in CRM software.  Managers should invest in customer relationship management software to track investor communications, feedback and follow-up actions.
  4. Increase dialogue with investors.  This could be face to face meeting, conference calls, quarterly or monthly letters.  Panelists indicated that this is a trend in the industry.  Ildi Duckor suggested that conference calls are optimal because they can be well scripted to keep on message.
  5. Dedicated Investor Relations function.  Firms that lost assets in the last year often did not have a dedicated investor relations function to communicate with investors.

Portfolio Managers and Marketing

There also was a discussion about whether Portfolio Managers should be the main marketing face to investors.  Ildi Duckor emphasized that whoever is before investors should be familiar with both the strategy and the documents.  Nicole Civitello noted that many investors want to see the Portfolio Managers early because inevitably there are questions that a marketing person will be unable to answer and, if the Portfolio Manager is not available, the investor will need to have a second meeting.  Robin Fink noted that marketing professionals in 2009 need to have an intimate knowledge of the portfolio and a granular understanding of the business.  They need to be more than executive secretaries planning trips and meetings.

Due Diligence in the Post-Madoff Environment

Another topic addressed by the panel that is of interest to hedge fund managers is due diligence in the post-Madoff envornment.  Nicole Civitello laid out the landscape in 2009:

  1. Longer review period.  In the past, investors often made investments after looking at a fund for three to six months.  Now the timeline has shifted to six months to a year or longer.
  2. Flows to managers in 2009.  Flows in 2009 have generally gone to the following: (a)Funds that outperformed on a relative basis in 2008; (b) Funds previously closed to new investments; and (c) Funds tracked by an investor for several years.
  3. Transparency.  It was emphasized by all of the panelists that investors are demanding more transparency.

Ildi Duckor noted a focus on operations by investors, and a movement away from self-administration.  The practical effect of this for startup managers is that they will not be able to give management fee concessions because they will need the management fees for increased operational costs.

Angela Osborne also noted that successful hedge fund managers have cohesion between the front and the back offices.  Great stock pickers are not necessarily great business managers, and they should be thoughtful in bringing in talent to run the business.

To find out more about marketing issues for hedge fund managers and other topics impacting hedge fund managers, please contact Karl Cole-Frieman of Cole-Frieman & Mallon LLP (www.colefrieman.com) at 415-352-2300 or [email protected]


Bart Mallon, Esq. of Cole-Frieman & Mallon LLP runs Hedge Fund Law Blog.  Mr. Mallon’s legal practice is devoted to helping emerging and start up hedge fund managers successfully launch a hedge fund.  If you are a hedge fund manager who is looking to start a hedge fund or if you are a current hedge fund manager with questions about the laws regarding raising hedge fund assets, please contact us or call Mr. Mallon directly at 415-868-5345.  Other related hedge fund law articles include:

Raising Hedge Fund Capital is Not Easy

I have written before that the biggest issue start-up and emerging hedge fund managers face is raising capital for their funds.  I seem to have the same conversation on a weekly basis – the “how to do I grow my fund” conversation.  Unfortunately I do not have the guaranteed step-by-step guide to raising boatloads of capital, but that is not to say that smaller managers cannot raise capital.  I have seen plenty of groups who have made it over the proverbial hump by working ridiculously hard.

The article below (written by Richard Wilson of Hedge Fund Blogger) discusses some ideas that managers will want to consider when developing a program to raise hedge fund capital.  Richard’s group provides consulting services and helps managers to raise money for their hedge funds.


This is Bad News: There is NO Magic Bullet
Richard Wilson

The bad news is there is no magic bullet to raising capital. I spoke with at least a dozen managers this past week at our Hedge Fund Premium networking event in Chicago. Most were looking for capital raising help of some type and we discussed many roadblocks that managers are seeing between them and the AUM levels they are trying to achieve.

Our firm provides some capital raising tools, but I believe that daily action and discipline is the best thing that a fund can do to raise capital. They must take responsibility for marketing their fund and have someone reaching out to new investors on a daily basis, if they do not they will forever remain in the bottom 20% of the industry in terms of assets. Very few funds gain their initial assets through a super powerful third party marketing firms, third party marketers like to typically work with managers which have some AUM momentum or foundation underneath them.

To raise capital I believe that managers need to have superior tools and processes when compared to their competitors. This means superior investor cultivation processes in place, superior investor relationships management, superior marketing materials, superior outreach efforts, superior email marketing, and superior focus on investors which actually have the potential of making an investment. Each of those topics mentioned above could be discussed for a whole conference and all of these moving parts need to be in place to compete in today’s industry. While this does not mean you need to out-spend others you do need to strategically plan your marketing campaign.

There is a good quote that I heard which goes something like “If you want to have what others don’t you have to do what others won’t” In other words if you want to grow assets you must put in the extra work, planning, and strategy that others skip over.

Every morning I try to listen to a 45 minute custom MP3 audio session of business lessons, marketing tips and positive thinking notes. One great quote I hear every morning by our friend Brian Tracy, “Successful people dislike to do the same things that unsuccessful people dislike to do, but successful people get them done anyways because that is what they know is the price of success.” This is connected to an interview Brian conducts in which a multi-millionaire says that success is easy, “you must decide exactly what it is you want, and then pay the price to get to that point.”

All of this may sound wishy washy or non-exact but I think it is very important to realize that there is no one single magic bullet for raising capital. It takes hard work, trial and a superior effort on all fronts to stand out from your competition.

Read dozens of additional articles like this within our Marketing & Sales Guide.

– Richard


Please contact us if you have any questions or would like to start a hedge fund. Other related hedge fund law articles include:

Bart Mallon, Esq. runs hedge fund law blog and has written most all of the articles which appear on this website.  Mr. Mallon’s legal practice is devoted to helping emerging and start up hedge fund managers successfully launch a hedge fund.  If you are a hedge fund manager who is looking to start a hedge fund, or if you have questions about investment adviser registration with the SEC or state securities commission, please call Mr. Mallon directly at 415-296-8510.

GIPS Compliance Information For Hedge Funds

Hedge Funds and GIPS Compliance

The Chartered Financial Analysts (CFA) Institute has spearheaded and implemented the Global Investment Performance Standards (GIPS) for investment managers as a means of establishing a higher standard for compliance with measurement and reporting of hedge fund performance.  GIPS standards set forth a universal set of guidelines and standards for measuring, calculating, and presenting aggregate gain and loss percentages in discretionary, managed investment accounts. Compliance with GIPS standards is voluntary, but it helps investment managers to attract and retain institutional investors who may require a higher standard for disclosure and accurate reporting.

What is GIPS?

The reporting and measuring standards from which GIPS originated were developed by CFA Institute beginning in the late 1980’s and have been gradually modified and reevaluated over the years.  While the CFA Institute initiated and funded the development of GIPS, the GIPS Executive Committee is responsible for maintaining the standards.  The key provision of GIPS is the requirement to include all of a firm’s fee-paying, discretionary amounts in a ‘composite’, or an aggregate of portfolios that share common investment objectives or strategies. The goal of using composites is to ensure ease of comparability between firms due to enhanced consistency.  To further aid the comparison of fund performance, the standards specifically disallow ‘nondiscretionary’ accounts from being included in the composites (where certain client restrictions render the fund’s performance more reflective of the clients’ decisions than the managers’ decisions).  Understanding and adhering to strict composite construction requirements is critical to GIPS compliance.

When should a Manager use GIPS?

There are several advantages to complying with GIPS and getting third-party verification. First and foremost is the added credibility of your hedge fund brought on by the claim of compliance (to be used in presentations, marketing materials, advertising, service agreements, etc.).  This credibility can help reinforce investor trust and create new relationships with new prospective clients.  Secondly, the level of consistency brought on by adherence to GIPS creates a more cohesive set of procedures regarding the calculation and presentation of performance. Thirdly, compliance with GIPS can assist firms with keeping up with the requirements of the SEC and avoid encountering claims of fraudulent conduct.  This is especially important for managers who may have had a prior track record with such claims or have had any actions brought against them by the SEC – incorporating GIPS compliance standards into the hedge fund practice will vindicate these managers of their past and help rebuild investor trust.

Twelve Steps to GIPS Compliance

The following procedure has been recommended by GIPS Execute Committee members in order to establish an effective compliance program for your firm.

  1. Management support. Management must make a commitment of time and resources to bring the firm into compliance.
  2. Know the Standards. Assign individuals or teams to review and familiarize themselves with the Standards and to complete each subsequent step.
  3. Define the firm. The definition should accurately reflect how the entity is held out to the public and will determine the scope of firm wide assets under management.
  4. Define investment discretion. The Standards use the term “discretion” more broadly than just whether or not a manager can place trades for a client. Defining investment discretion is an important step in determining whether or not accounts must be included in a composite.
  5. Identify all accounts under management within the defined firm over the past five years, or since firm inception if less than five years. This should include all discretionary and nondiscretionary accounts, including terminated relationships.
  6. Determine if your firm has the appropriate books and records to support historical discretionary account performance.
  7. Separate the list of accounts into groups based on discretionary status, investment mandate, and/or other criteria. These groups will be the foundation for your composites.
  8. List and define the composites that will be constructed.
  9. Document your firm’s policies and procedures for establishing and maintaining compliance with the Standards.
  10. Document reasons for composite membership changes throughout each account’s history and reasons for nondiscretionary status, if applicable.
  11. Calculate composite performance and required annual statistics.
  12. Develop fully compliant marketing materials.

How to Get Started

As of 2007, 28 countries have adopted the GIPS standards or have had their local performance reporting standards endorsed by the GIPS Executive Committee.  Formally recognized in 29 major financial markets, GIPS compliances enables investment firms to fairly compete throughout the world and provides a standard framework to ensure that funds’ performance figures are directly comparable. Although it is in the best interest of any investment firm that wants to compete effectively and fairly to adhere to the GIPS standards, the issue for most firms is how to accomplish this successfully and cost-efficiently. For many firms, this may require adding GIPS experts to staff or turning to outside professionals, depending on the firm’s size, available resources, and overall business strategy. There are many GIPS service providers, including software vendors and verification/consulting firms, that can help investments firms become and remain GIPS compliant.

To help you select a service provider to help your firm get started with compliance efforts, you can refer to the list of GIPS Service Providers. You can also find the full text of the GIPS standards here.


Please contact us if you have any questions or would like to start a hedge fund.  Other related hedge fund law articles include:

Hedge Fund Tearsheets

Marketing Your Fund with a One-Pager

In addition to hedge fund pitchbooks, managers will market their hedge funds through one page tearsheets.  Hedge fund tearsheets are basically a snapshot of a hedge fund’s performance over time, as of a certain date.   There are a growing number of companies out there which will produce tearsheets for managers, but many managers will be able to produce their own tearsheets internally.  This article will discuss the common items found in most hedge fund tearsheets and will also provide an example of a tearsheet.

Overview of Tearsheets

Like the pitchbook, the tearsheet contains much of the manager’s contact information, as well as information on the terms of the fund and the fund’s performance.  Below are some features which are common to most tearsheets:

Management Company Information – the management company will usually be named on the tearsheet.  Usually the address as well the contact information for the firm will also be included.

Fund Information – the name of the fund is typically displayed near the top of the tearsheet.  Other fund information usually includes: assets under management (AUM), leverage (not strictly necessary), fees (management and performance), and investment objective/strategy discussion.

Logo – many hedge fund management companies, and sometime the fund itself, will have a logo.  In such event the logo is usually incorporated into the tearsheet.

Performance Results – there are a number of charts and graphs which show the fund’s investment returns over a certain period of time.  A fund’s metrics are also discussed (alpha, beta, standard deviation, correlation, sharpe ratio, drawdown information, % of up/ down months, etc.).   It is common for these returns to be compared to a comparable index and/or to the S&P 500.  Performance results are usually shown in a graph figure.  Monthly performance figures, growth charts, statistical analysis, risk-return scattergram, and other visual representations of the performance data may also be utilized.

Written Summary/ Discussion (optional) – sometimes managers will choose to provide a written discussion of the fund’s performance results for the period.  This can be incorporated into the tearsheet or can be provided to investors as a separate document.  Some managers choose to have more frequent tearsheets (e.g. monthly) and less frequently written discussions (e.g. quarterly or yearly).

Legal Disclaimer – a legal disclaimer should be included with all tearsheets.  The tearsheets should also be reviewed by an attorney for legal compliance.  While many tearsheets do not have the legal disclaimer, we do not recommend this practice as a tearsheet is a manager communication which will need to include the appropriate performance disclosures (see Hedge Fund Performance Reporting).

Optional – naming of the individual fund managers and providing biographical information such managers; including famous quotes, news articles, or quotes from news articles, etc.

Sample Hedge Fund Tearsheet

Our firm has prepared a sample hedge fund tearsheet (forthcoming).  [HFLB note: please see the Fairfield Greenwich tearsheets which are great examples of hedge fund tearsheets – please note that these tearsheets have a very long legal disclaimer.]

Preparing Tearsheets

There are a number of firms which provide tearsheet preparation services.  In addition to providing analysis, statistical calculations and graph preparation, these firms help to make the tearsheets aesthetically pleasing.  Normally these arrangements are done on a flat fee basis.

Our firm can help you with the preparation of the tearsheets or can provide advice on the look and feel of a tearsheet which you have prepared.  Please contact us if you have any questions on this or other hedge fund start up issues.  Related articles include:

Hedge Fund Pitchbook

Using a Pitchbook to Market Your Hedge Fund

Marketing a hedge fund is one of the more difficult parts of running and managing a fund.  Many times, managers will discuss investments into a fund through a face-to-face meeting with a potential investor.  During this meeting, a manager will utilize a “pitchbook” as the central way of conveying the most important aspects of an investment in the fund.  This article will provide an overview of the most common parts of a hedge fund pitchbook.  We have also provided a sample pitchbook below. Continue reading

Incubator Hedge Funds

How to Create an Auditable and Marketable Trackrecord

One of the biggest hurdles that start up hedge fund managers face is the issue of having a marketable track record. Many managers do not have an audited marketable trackrecord for any number of reasons. While it is not strictly necessary to have an audited marketable trackrecord, it will help with the marketing efforts when soliciting investors, especially institutional investors. To solve this problem many start up managers establish incubator hedge funds. Continue reading