Marketing to RIAs...a few more ques

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Jan 3, 2011 2:05 pm

Hi everyone,

I manage a deep value portfolio through a hedge fund and separately managed accounts for friends/family and want to blow that out a bit more broadly.  Most of my background and prospecting has been towards large institutional investors that generally want succint but somewhat granular presentations.  My investment strategy is mainly deep value (buying stuff below mostly tangible book value), very research oriented, ~25 holdings and tax efficient in that the turnover is low.  It's pretty basic for someone that runs an RIA to "get it" but I realize you guys are bombarded continuously by various investment products and as I retool my presentation for indie RIAs, I want to hit them with the right level of detail without overloading them.

As I refine and retool my investment message to an RIA I was wondering how long the powerpoint (in pdf format) should ideally be and what specifically RIAs are looking for?  My current presentation is about 20 pages but that's for institutional folks that want some more background data that I don't think RIAs would initially want (always available upon requst).  I was thinking to make it 10 pages or so? 

Also, looking through the Advisor Yearbook as a source for potential RIAs to market to but many say that they take no fees/commissions.  So how does a small investment firm get through the door of a smaller RIA?   The only thing off the top of my head that I thought would make sense would be to propose splitting my general fee with them but would that be taken as an insult?  Again, I plead ignorance to this stuff and apologize in advance.

My prior background is CFA, MBA from a top 25 program, stints at investment banks before deciding to run my own fund.  I'm the largest investor, started in Jan 2007, everyone is in the black vs being down in the SP500 from Jan 07-Dec 10.  I started the SMAs this year, they were up on avg about 9% net (need to see te final statements), bulk of the capital came in around April/May as an FYI. 

Jan 5, 2011 10:14 am

You can't really pay to play with an RIA, as far as I am aware.  RIAs can not earn a commission, can't take 12B-1's, etc. 

Hedge funds are clumsy for me, as an RIA.  I'd rather not have investments outside of my custodian.  SMAs are doable, but it would be best for you to establish the relationship with the custodian/BD first (you CAN pay them to get on their platform).

But to ultimately get the RIAs to put their clients dollars in your investment...you face the same challange as any wholesaler.  I generally won't take a call from most marketers, and very unlikely to do so from one I am not familiar with.  I get a barrage of requests from a bunch of established fund families, smaller funds and SMA shops, and I just can't meet or speak with everybody who wants to.  I don't have any good advice on that front, sorry.