Capital Allocators – Inside the Institutional Investment Industry Erik Serrano Berntsen – Backing Alternative Founders at Stable Asset Management (Capital Allocators, EP.218)
13 snips
Oct 18, 2021 In this insightful conversation, Erik Serrano Berntsen, Founder and CEO of Stable Asset Management, shares his journey in building a $3 billion asset venture. He discusses the vital qualities of successful founders and the importance of early engagement and relationship building in the investment community. Erik highlights the competitive edge smaller investment firms hold and how technology can streamline decision-making processes. He emphasizes the challenges emerging managers face and the critical role of strategic partnerships in securing funding.
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Risk Mitigation
- Mitigate allocator risk by setting proper expectations, emphasizing the higher failure rate of emerging managers.
- Build diversified portfolios of emerging managers to offset losses with outsized wins.
Diligence Focus
- Due diligence on emerging managers must consider investment skills, organizational alpha, and operational and commercial viability.
- Evaluate if the manager can replicate their previous success independently and build a sustainable business.
Long-Term Thinking
- Encourage a long-term strategic view over short-term monetary gains.
- Accept fee discounts from large, long-term institutional investors for the strategic benefits of a lasting relationship.
