Successful fundraising for alternative asset funds is being challenged by several core issues according to new research.
Alt fund managers say that the current regulatory environment is their biggest concern followed by reporting. Liquidity is also included in the top 3 concerns cited by respondents to the survey in the US, UK, and Europe.
Regulators are increasingly focused on ensuring that alt funds are meeting requirements on sustainability practices and reporting.
“The impact of global reporting burdens, coupled with an evolving regulatory environment, means that alternative fund managers are now facing unprecedented challenges and it’s never been more important to partner with firms that can provide the right assistance and expertise to assist managers to navigate these,” said Paul Spendiff, head of business development, global funds at Ocorian.
The survey also asked about preferred methods of raising capital.
Private placement is the top option among the alt fund managers who are planning to raise capital for funds with 83% planning to use this method in the next 18 months.
Second is alternative investment fund (AIF) marketing with almost half (47%) expecting to use it in the next 18 months, and using a broker is listed as the third most important method, although just 35% of alternative asset managers are planning to do so in the next 18 months.
Most important method to raise capital for funds listed by alternative fund managers planning to raise capital for funds (listed in order of importance) | Percentage of alternative fund managers who will use these methods to raise capital for funds in the next 18 months |
Private placement | Private placement (83%) |
AIF marketing | AIF marketing (47%) |
Broker | Agent driven (46%) |
Agent driven | Platform driven (38%) |
Platform driven | Brokers (35%) |
Seed investment / cornerstone driven | Seed investment / cornerstone driven (4%) |
“There’s a big pull to alternative investments right now because of volatility of the stock market,” Kevin Gannon, CEO of Robert A. Stanger & Co., said.
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