Over the next few weeks, I’ll be posting a number of thought pieces entitled Manager Perspectives. The aim of this first series will be to express a view on what managers are thinking or should be thinking as they make critical strategic decisions (especially at this time of year) about their business and how to take it forward.
Today, however, I’ll be talking about the Reframe Capital proposition for fund managers at different stages of the lifecycle, the unique challenges they each face, and how we can offer a new approach, valuable tools, expertise and support to overcome them.
This week, Reframe Capital was launched with the opening line: We see the world from your perspective, then align with it to effectively serve your business.
Those words aren’t intended to be a carefully crafted strapline, they reflect the very core of our value proposition.
Why is that?
Well, because we have a deep understanding of a manager’s needs, and have the background, the knowledge, the experience, the ability, the network and, critically, the vision to meet them.
The best way to illustrate this is through a widely-known rule of organisational theory – the S-curve of business.
For those who may not be familiar with it, in one sentence, the curve reflects the cycle of growth and maturity that every business, including managers, will go through.
As each manager navigates the cycle, it encounters a set of problems that will be unique to its business. Having been on a journey through each stage of the curve with different firms, we have the ability to guide you successfully to the next growth phase for your business.
Let’s look at the three main reference points along the curve, the profile of managers at the relevant stage of the lifecycle and how Reframe Capital can tailor its offering to help:
Early Business
Manager Profile
Here, we’re talking about new entrant or emerging managers. Challenges they face are many and varied, but all feed into one objective – bringing their capability to market.
Most such managers have identified a gap, an opportunity, a new strategy, but lack the platform and strategic roadmap to launch the offering.
Naturally, there’s a requirement to compress the go-to-market timeframe, given initial set-up expenditure with no revenue stream.
Reframe Value Proposition
We can support the manager’s core team by:
- Facilitating initial regulatory approvals and business plan for the new manager entity.
- Assisting with internal team, organisational and operating model build-out.
- Funding and financing solutions.
- Guiding decisions on systems infrastructure, internal governance and controls, policies and procedural framework.
- Business and product p/l modelling.
- Mapping advisor, service provider and other vendor requirements, identifying firms and partners, negotiating relationship pricing and (once approved) coordinating onboarding process, account opening and connectivity build.
- Product strategy roadmap – Market opportunity assessment and entry points, product positioning, peer group review, product domicile and structure determination, initial product development plan (including tax considerations).
- Distribution strategy roadmap – Marketing literature, target market assessments (with client segment mapping), eligibility requirements, market intelligence reporting, access to marketing passports, third party fundraising support, strategic partnership opportunities, go-to-market plan.
- Establishing client service and reporting framework, data management platform, technical and regulatory reporting (EMEA eg.: Annex IV, Solvency II, DAC 6).
- Internal team training and BAU transition.
Transform Business
Manager Profile
This stage of the cycle refers to those managers who have developed their business, proven the viability of their investment thesis and demonstrated an ability to secure AUM and scale. They will have overcome early business challenges, and turned attention to the next growth phase.
Typically, this is in one of three main areas:
- New geographical markets
- New products or asset classes
- New client segments
Growth may be contemplated as organic, through strategic partnerships or inorganic (by way of acquisition or merger).
Reframe Value Proposition
We can support the manager’s plans through:
- New market strategy – Hiring local talent, advisor and vendor selection, identifying regulatory requirements and securing approvals, office space sourcing, business support mapping, tax impact, operational and reputational risk assessment.
- Opportunity assessment by market, product or client type, including addressable asset determination, competitor positioning and distribution modelling.
- As with Early Business (above), creation of business and product p/l models, product and distribution strategy roadmaps, development of market, product, asset class or client specific policies and procedures, establishment of internal systems and controls, client engagement and service platform, internal team training.
Decline Business
Manager Profile
A place no manager wishes to find itself, but one which is common in the current market (particularly in the midst of a global pandemic).
A position characterised by all or any of the following: falling revenues and squeezed margins, increasing cost, headcount pressure, attritional decline in AUM, loss of competitive place, operational burden and inefficiency, a lack of strategic direction with limited product differentiation.
It takes courage to accept such a position, recognise the need for change and be prepared to act, but those that do can, with conviction and a clear roadmap, extend the S-curve and return to a position of strength with potential for growth.
Reframe Value Proposition
- Conducting full business review, performing SWOT analysis, business goal reset.
- Making recommendations across organisational change and functional group alignment, cost saving requirements, business line closure, merger or re-positioning, operating model efficiency initiatives, vendor management and relationship optimisation, product opportunities or rationalisation, capital redeployment, competitor mapping, distribution strategy review.
- Exploring prospects for strategic partnerships, business consolidation, acquisitions, positioning for buy-out opportunities and capital release.
- Creating and analysing business case for outsourced solutions.
Wrap-Up
Last week The Drawdown published an article about the launch of Reframe Capital. That article included the following quote from me:
“My aim is to help managers set a clear strategic direction and grow their business, from whatever position they’re currently in. Many managers, especially as a result of the pandemic, may need to re-assess their business and determine what their competitive position is. I can work with them to define their strengths and weaknesses and then create a strategic roadmap, which may involve repositioning their business, developing a new strategy or products or targeting new client segments.”
We’re an investment solutions boutique. That means we’re in the business of achieving outcomes for our clients. If you can identify with any of the above topics, if they in any way reflect where you currently stand, it would be a pleasure to speak with you and see how we might help your business to move forward with confidence and clear direction.