Are You Ready For Distribution?
The Gemini Companies (Gemini) distributor believes successful marketing strategies require a thorough self-assessment during the distribution planning phase and frequent reviews to adjust accordingly. During strategy planning, investment advisers should seek to understand how to access their desired target client with focus on product placement requirements and expected activity. Gaining such understanding will help determine the best course of action to implement your distribution strategy and focus your time and resources in markets that are open to your fund opportunity.
Gemini developed the distribution growth cycle model to assist investment advisers in matching their current distribution characteristics with potential opportunities, allowing managers to tactically develop their distribution plan to match. Gemini’s distributor identified four distribution phases: Raising Capital, Emerging Manager, Growing Manager, and Established Partners. Each distribution phase has distinct characteristics, challenges, and opportunities. The phases are defined as:
FOUR DISTRIBUTION PHASES
Raising Capital – Investment advisers that have less than $250 million in firm assets under management and a fund with less than $100 million in assets. Fund may have less than a 1 year track record.
- OBJECTIVE – Funds at this phase are seeking to raise capital and raise awareness of their strategy
- CHALLENGES – Short track record, no Morningstar rating, conservative sales and marketing budget
- OPPORTUNITIES –Tactical, geographic sales activity within platforms, that are open to listening to a new story
Emerging Manager – Investment advisers with approximately $250 million to $1 billion in firm assets under management and a fund with less than $200 million in assets. Fund may have a 1 to 3 year track record.
- OBJECTIVE – Firms at this phase have garnered success raising assets and capitalize on that success to elevate awareness of their strategy
- CHALLENGES – Less than three year track record, at the cusp of Morningstar rating, moderate sales and marketing budget
- OPPORTUNITIES – With a young track record, broaden product placement within existing platforms and potentially expand to additional platforms. Increase activity in preexisting platforms through meeting participation and creating value add (i.e. intellectual capital)
Growing Manager – Investment advisers with over $1 to $5 billion in firm assets under management and a fund with more than $200 million in assets. Fund track record is 3 to 5 years.
- OBJECTIVE – Firms at this phase have garnered success and are seeking deeper and broader platform placement opportunities
- CHALLENGES – Established competition, strategic sales and marketing budget
- OPPORTUNITIES – Broaden product placement within preexisting platforms, seek new distribution markets, and increase sales and marketing activity at the local, regional and national levels
Established Partners – Investment advisers with over $5 billion in firm assets and with a 5 plus year track record.
- OBJECTIVE – Firms at this phase have a solid footprint in the investment community, may be seen as a market leader in their space. They are seeking to deepen relationships and product penetration across programs and platforms
- CHALLENGES – Established competition
- OPPORTUNITIES – Increase activity in preexisting platforms, create new strategies, seek allocations within recommended programs and seek new platforms open to a proven story
Northern Lights Distributors, LLC