Agecroft Partners specialises in consulting and third-party marketing for the alternative investment industry, with a particular focus on hedge funds. The firm raises assets globally for institutional-quality managers by utilising a consultative approach within the institutional investor community. Its approach is to develop in-depth product knowledge of the funds the firm represents and to be able to articulate their investment processes as well as the hedge fund managers.
Agecroft was founded by Don Steinbrugge (pictured), who has 27 years of experience in the institutional investment management sales industry, including serving as head of sales for one of the world’s largest hedge fund firms as well as for a leading global institutional investment manager.
Overall, the firm’s partners have strong investment and industry knowledge, which gives them credibility with major institutional investors. They average more than 15 years of industry experience, and a majority have previously worked for multi-billion dollar alternative investment firms.
Agecroft is highly selective in choosing the firms it represents – around half a dozen at any one time – and uses an institutional-quality due diligence process to sift through the thousands of managers in the marketplace. It develops client relationships through 1) direct contact from hedge fund managers, 2) referrals from institutional investors, prime brokers and other service providers, 3) research using industry publications and conference attendance, and 4) screening of multiple hedge fund databases.
Agecroft Partners can raise assets for its clients either on a global basis or as a complement to a hedge fund firm’s existing marketing strategy, focusing on a particular geographic region or investor segment. The senior partners typically are in contact with more than 1,000 investors and hold face-to-face meetings with up to 100 every month.
The thoroughness of Agecroft’s screening process not only helps it stand out from the competition but boosts the credibility of its clients among investors. Says Steinbrugge: “We use quantitative screens to narrow the universe of hedge funds and prioritise further research efforts.
“We look for at least USD75m in assets within the strategy, performance near the top of the strategy’s peer group, high relative Sharp and Sortino ratios and low historical performance drawdowns, low correlation to a major market index, and performance characterised by quantifiable alpha and its repetitiveness.”
Agecroft’s qualitative screening reflects the questions asked by investors, including a top-down analysis of the strategy and assessment of whether it is likely to be successful in the current economic environment. It will also assess the quality of the investment team in terms of pedigree, industry knowledge, experience and reputation, the management firm’s infrastructure and commitment to ongoing reinvestment in operational resources, risk controls, service providers and fund terms.
The screening processes are complemented by on-site visits and conference calls involving the potential client’s portfolio manager and senior members of the Agecroft team, as well as the checking of references and other sources, including service provides, to confirm good standing and reputation.
The process does not stop when the manager becomes a client. “Once they join our platform we receive constant feedback from the many investors we reach out to each month,” Steinbrugge says. “This feedback is communicated to managers to help improve their offering, but we also review this information constantly for any sign of potential issues with a manager.”
He adds: “We’re continuously focused on ensuring that our brand remains strong, which is why we are honoured to have won this award and to have earned the votes of industry members both in the USA and worldwide.”