At its best, investor relations offers hedge fund managers a strategic opportunity to
communicate fund performance. Too often, creating investor communications turns into a
bureaucratic burden involving compliance regulations, excessive emails, and context-less
reports floating around.
Here are seven best practices for hedge fund managers ready to innovate their investor
relations.
Optimized Data Room Experience
An well-optimized data room with clear documentation of fund performance compels investors to onboard with your hedge fund. Think of your data room as the last opportunity to market a fund to prospective investors.
Fully Digital Onboarding
To reduce friction, offer e-signature capabilities and digital subscription documents. Investors can perform their due diligence without extra meetings or emails with the fund manager. Most investors use secure financial portals already for banking and other investments, it’s time that all hedge funds offer similar digital processes for investor onboarding.
Strategic Automations
Simplify and automate repetitive communications to ensure that messages are legally compliant and complete with necessary information. Newly onboarded investors or quarterly reporting are excellent areas for automated messaging. As the fund manager, you appreciate streamlined communications that mitigate endless emails while investors still receive appropriately timed information at crucial junctures.
Integrated CRM
A customer relationship management (CRM) database helps organize and track communications so no inquiries or questions from investors are overlooked. The real power
comes from integrating a CRM with other critical systems and administrative processes. By
connecting your CRM with tools like fund administration software, investor portals, and data rooms, you can create a seamless, end-to-end platform for managing fundraising and investor
relations.
Convenient Investor Portals
Having an intuitive investor portal reduces administrative burdens. If you can easily contact
investors through an all-in-one platform and/or investors can easily log in to check their fund performance, then more time can be spent on investment management rather than managing messages. Look for a hedge fund administration platform that allows you to directly track, report, and manage investor communications.
Useful Performance Reports
What do hedge fund investors care most about? Likely details on returns for this quarter – so clearly visualize and provide context for those metrics front and center. Create reports (or live dashboards) that investors want to examine and explore. Clearly outlining information leads to less clarifying emails and an implicit opportunity to market your hedge fund.
Streamlined Comm Flows
Ultimately, fund managers should have their attention on fund performance and strategy, not anendless stream of investor relations tasks and administrative work. Meeting the compliance requirements and keeping investors abreast of major developments should be the primary goals; not pumping out content constantly. Build a communication flow that requires only lighthuman touch and minimal meetings to fully deploy. Investors tend to be busy people too; they do not necessarily want to read messages from their fund manager every week. (Focus your communication efforts on fundraising with new investors instead.)
As the world of hedge funds embraces new fund administration technology, it’s also time to
update your investor relations. Forget the emailed PDFs; streamline your investor communications.
Founder Dinis Guarda
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