Looking for other CTAs/money managers to exchange marketing ideas with. I am a CTA with a little over $3m under management with just over a year of track record. My AUM have appreciated steadily over the past year from $250K, but it is getting to the point where I think it may be running out of steam. I just wanted to find someone who has been there and may have some ideas for on going marketing. I know that returns are my best marketing tool, but I'm certain that there are more ways to get my name in front of people. I do report my performance to 11 different manager tracking databases. If there are any other managers out there who may have some advice I would enjoy talking to you about it. Feel free to PM me.
Interesting topic. One I ponder about frequently. You have done well so far in running from .25M to 3M in less than one year. How did you do it? Did you raise all the money from people who CAME TO YOU in response to your database listings? Finally, I didn't know there were up to 11 databases. I'm aware of hedgeworld/lipper, hedgefund.net, msci, morningstar, iasg, cogenthedge, barclay, marhedge, autumngold Which ones am I missing? I hope we can get some good dialogue here. Thanks for starting the thread.
CP, I am quite happy with the amount that has flowed in over the past year. Here is where it came from, myself, family and friends, the firm I used to trade at, a new fund which found me on a database, and a brokerage where I won a trading contest last year. So only one of those investors came from a database. If they weren't free they wouldn't be worth it in my opinion. You showed me some that I don't post on I appreciate it. Here is my list of databases that I submit to monthly and I apologize it is only 10 not 11: Managedfutures.com Barclays IASG Stark Autumngold Hedgefund.net Cogenthedge Tremont Hedgefund Research Alternative Asset Center There are other databases which get their information from some of the one listed above so I could be on more than I know about. I want to start submitting to MAR Hedge, but when I went to the site I couldn't figure it out. I know they require you to have at least a year of track record. Anyhow, that is all I do in the way of marketing right now. I have gotten calls from people who sell lead sources, but I am not interested in cold calling people. I am really looking for someone to partner with that will take care of my marketing for me. Problem is when I tell them that this particular strategy is limited in size they turn me down. It can handle a descent amount of money but not enough to entice a 3rd party marketer. I have other strategies that could potentially handle significantly more assets but I don't even bother telling them about them because they are still in their infancy. So that's where I'm at as far as marketing goes. I know that if I keep doing what I am doing eventually the money will come in. I just want to figure out a way to get my name infront of as many people as possible in the mean time.
fitrol, Where you are located is an issue. I am in Florida right now, but I am headed up to Chicago hopefully by mid summer. I am making this move not so that people can come see me, but rather because I believe I will make much better business contacts being up there. I am in the same boat as you. I wrote an article for Futures which was published in the August issue. That month I also received the highest number of hits to my web site but I did not receive any investors. The article was about trading crude oil, which is something I do on a proprietary level but it is not relevant to my current strategy. I have also thought about teaming up with a brokerage. It is something I am kind of doing through the FCM where I won that trading contest, but it is by no means a binding agreement. It is basically, "Who ever you bring me I will pay you x% of my fees as long as you don't over charge them commissions." My problem with brokerages is that I am not heavy on the trading. They cannot make much money off of my rounds, but I have not fully explored this option with any kind of serious agreement. Ideally I would like to find a small TPM with a roladex of high net worths like you mentioned. I have yet to find one though. As far as my drawdowns go there haven't been any yet. A problem is that my returns aren't huge. Annualized my returns are around 15% net of fees. This isn't great, but month to month my returns have been very consistent, my annualized standard deviation is 1.3%. One thing I have thought is that with returns like that people are going to want to see much more track record before they make a decision. This is very understandable.
Thanks LongView & fitrol, my comrades in the struggle! The money raising game is full of ironies/paradoxes. I do believe the keys to successful money raising are providence (luck) and great performance. Not one or the other BUT BOTH! I have seen funds go from under 1M to over 100M in 12/18 months and others with "better" performance just stagnate. I also know that it seems until you cross the $10M barrier no matter how good your performance not many take you seriously. So that embryonic stage (i.e. sub-10M) is the key are...but it's so difficult raising money in that zone EVEN with great performance. Ideally I think the best route would be to find an angel/true seed investor who could invest $10M or more at a clip and thus give you instant visibility/validation. With this you are propelled out of the embryonic zone and if you have the good performance, some marketing savvy the money will find you. Again getting from 0 - 10 is the problem. Also investors HATE volatility or drawdowns. Naive in my opinion, but that's the reality. So it's a harder sell even if you have more than 10M but have volatile returns. But now that I think of thereâs aguy on his list who has quite volatile returns but now has over 35M AUM. Iâm not sure how he did it. Well these are some of my thoughts,. Please keep sharing. Fitrol, I am OK, had a though Dec & Jan..but we're still kicking forward. You and Long View should both be managing in excess of 10-20M given your returns....but the buyers are so fickle.
CP, Thanks for the compliment. Just thought I'd post this really quick. It's a list of TPMs specifically for money managers that I just found. Hopefully something will come of one of these companies for one of us struggling managers. www.3pm.org/directory.html Got get back to work. Interesting action in the spooz today.
I don't believe in 3pms....most of them are charlatans. They can't provide any true service. What do I need a 3pm for if i have AUM of 75M. What jokers they are.
It is nice to see a CTA/HF thread last on the site w/out a prop guy posting the anti-fund rant. The TPM guys can be very helpful or hurtful, they are much like the headhunters, some paper the street w/ your deck, others have in-depth knowledge of client needs and try to make proper matches. I think time is what helps all marketing efforts. My partner and I are launching on 4/3, with about 3 million. We come from a highly respected house so we get a bunch of meetings. The standard response is come back in 6 months when your fund is up and running. So, my point is get on as many people's radars as possible. When people ask to be kept up, keep them up aggressively. Put your head down and work to put up returns, and the money will find you. Also, if your record is great and your problems are on the business side (raising funds, office work, etc), you can take your results and goto either the seeders or an existing fund to trade a carve out. The houses on Wall Street will always be there, and so will the safe living, but nobody ever gets really rich w/out putting his ass on the line. I would like to keep in touch w/ the other CTA/HF managers, drop me a PM if you need anything.
i recently met someone with a good institutional capital network who suggested partnering as a marketer or potentially helping me make the leap to opm. i'm trying to assess my ability to scale, deal with legal and reporting, etc. i was hoping to get an idea of what a standard compensation structure is for an effective marketer of a small upstart. is it a % of what he raises, an ongoing % of mgmt fee, or even % of the performance fee? is there a standard for someone with a good 3 yr retail record, but unproven ability to scale do you ever consider that AUM could saturate specific strategies to the point that opm isn't worthwhile, or that it's actually better to stay small and protect consistent systematic systems trading them with retail leverage, slower, but more consistently? i guess in that situation the work isn't sufficient to justify real opm. you guys sound very far past that point, but i was just wondering what effective marketing is worth. i assume if you understand your ability to scale, the growth payoff is much more clear thx and sorry if this is off topic
Another issue is that so many of the so-called incubators/seed capital providers don't truly want early stage investors like ourselves. They want the guy who left a bank's "prop-desk" or another marquee name fund and has already raised 20/50M. Again, my question is, if I worked on a bank's prop-desk or for a marqueee hdge fund why do I need a seed deal?