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  • McGladrey Alliance

    McGladrey Alliance

Strategic, Management & “Best Practice” Assistance

The “COO Center” is sponsored by Investment Business Advisors LLC (IBA) in cooperation with FTS. IBA provides private equity, real estate, hedge fund and fund of hedge fund general partner firms with strategic, management and “Best Practice” advice as they seek to enhance the effectiveness of their investment and support business processes, undertake growth initiatives and continue to implement lessons learned from the 2008-09 global financial crisis.   

For more information visit Investment Business Advisors LLC.  Paul Ehrhardt Managing Member Email: pae@investbizadvisors.com


Governance

  • Overall Policies and Principles:
  • FIRM
    • Board/Advisory Board
    • Management Committee
    • Investment Committee
    • Investment Functions:
      • Portfolio Management
      • Research
      • Risk Management
      • Trading
    • Supporting Business Functions:
      • Legal
      • Compliance
      • Technology
      • Operations
      • Marketing
      • Client Service
      • Finance
      • Human Resources
      • Communications
      • 3rd Party Service Providers
  • FUND
    • Fund Terms
    • Outside Directors
    • Limited Partners Committee
    • Fund Operations
      • Administrator/Custodian
      • Investors
      • Manager
    • “Alignment of Interests”
      • Investors
      • Firm Management
      • Investment Professionals
      • Supporting Business Professionals
      • See: www.alignmentofinterests.org

Manager Firm Stage

Manager Firm Status/Stage:
  • Start-up
  • Spin-off
  • Emerging
  • Established
  • Subsidiary/Affiliate of Bank/Insurance Company
  • Listed/Privately Held
  • Shrinking
  • Mix of Internal and Outsourced Functions

Organization Structure

  • Overall Firm
  • Investment Team(s)
  • Supporting Business Functions
  • Third Party Providers
  • Single HQ Location/Regulatory Regime
  • Establishing New International Office(s)/Regulatory Regimes
  • Roles, Responsibilities & Processes Across Multiple Offices
  • Reporting Relationships: Functional/ Geographic/ Matrix
  • Assuring Integrity & Consistency of Investment Process Across Multiple Locations

Strategic Planning

  • Investment Strategy/ Strategies
  • Firm Strategic Business Plan
  • Functional Strategic Plans
  • Alignment/Integration of Investment Strategy and Business Strategy
  • Alignment of Firm and Functional Strategic Plans
  • Ongoing Evaluation and Continuous Improvement
  • Competitor Analysis
  • Investor Expectations

Expansion Initiatives

  • Internal Organic Growth
  • Acquisition/Integration of Manager
  • Acquisition/Integration by Manager
  • Strategic Partner Investment
  • Acquisition of Portfolio(s)
  • "Spin-off" of Portfolio(s)
  • How to Work with Investment Bankers
  • Adding New Investment Strategy or Product
  • Marketing to New Investor Types
    • Private Bank Platform
    • Corporate/Public Pension Plan
    • Sovereign Wealth Fund
    • Endowment, Foundation, Family Office, etc.
  • Marketing to Same Investor Types in New Geography

Due Diligence Readiness

  • Meeting Investor & Regulator Expectations
  • Transparency
  • Investment "Due Diligence"
  • "Operational Due Diligence" ("Ops DD")
  • Firm Due Diligence
  • Fund Due Diligence
  • Investment & Business "Due Diligence"
  • Firm and Fund "Due Diligence Questionnaires (DDQ's)"

Transparency

  • Workflow Documentation: Words & Graphics e.g., "Business Process Mapping"; "Process Excellence" (PEX)
  • Investment Function Workflows:
    • Portfolio Management
    • Research
    • Risk Management
    • Trading
  • Supporting Investment Business Function Workflows
  • Third-Party Provider Workflows
  • Establish & Disclose
    • Fund Capacity
      • Criteria
      • Rationale
    • Fund Closure
      • Criteria
      • Rationale
  • *Note: Workflow Documentation Supports Achievement of:
    • Transparency Objectives
    • Effectiveness & Efficiency Objectives
    • Alignment Objectives, and
    • Development of Succession Planning, Development & Training Programs and Career Path Programs

Best Practice Assessments

  • Firm Governance "Best Practice"
    • Management Committee
    • Board/ Advisory Board
    • Investment Committee
  • Investment Processes & Professionals
    • Portfolio Managers
    • Research
      • Qualitative
      • Quantitative
    • Risk Managers
    • Traders
  • Investment Support Processes & Professionals
    • Legal/Compliance
    • Technology
    • Operations
    • Marketing
    • Client Services
    • Finance
    • Human Resources
    • Communications
    • 3rd Party Service Providers
  • Alignment/ Integration
    • Investment Strategy
    • Business Strategy
    • Marketing Strategy
    • Compensation Policy & Programs
  • Fund Governance "Best Practice"
    • Fund Terms
    • Subscription/ Redemption Processes
    • Capital Calls
    • "Clawback" Provisions
    • Co-investments of Manager Staff on Same Terms as Investors
    • Performance Calculations
    • Global Investment Performance Standards (GIPS)
    • Performance "Crystallization" Policy & Practice
    • Investor "Side-Letters"
    • Fund "Side Pockets"
    • Fund/Investment Distributions
    • Return of Capital

Lessons Learned

  • Lessons Learned 2008-09 Financial Crisis
  • Private Fund Terms (PPM)
  • "Side Letters"
  • Transparency
  • Liquidity/ Illiquidity
  • Portfolio Diversification
  • Low/ No Correlation
  • Explicit "Downside Protection" Allocations
  • Leverage: Use and Misuse
  • Valuation Issues
  • "Side Pockets"
  • Risk Management Capabilities
  • Credit Facility Issues
  • Firm & Fund Leadership Challenges
  • Management & Governance Standards and Skills
  • "Alignment of Interests"
    • Investor Interests
    • Investment Manager Interests
  • Need for Expanded and Enhanced "Due Diligence" Capabilities
    • Traditional Investment Due Diligence
    • Firm/Manager Due Diligence
    • Fund/Account Due Diligence
    • Traditional "Operational Due Diligence" ("OPS DD")
    • Investment Business Process Due Diligence
  • Need for True "Culture of Compliance"
  • High Quality Ongoing Investor Communications

Compensation & Benefits

  • Compensation & Benefits Programs
    • Levels
    • Structure
      • Base Salary
      • Bonus Opportunity
      • Equity
      • Long Term Incentives
    • Competitiveness
      • By Function
      • By Geography
    • Performance Criteria & Assessment Processes
      • Clear Goals & Objectives
      • Outcome Based Performance Criteria
      • Timely Feedback/ "360" Feedback
    • Alignment of Compensation & Benefit Programs with:
      • Investment Strategy
      • Business Strategy
      • Investor Interests
    • "Apples to Apples" Competitor Analysis
    • Staying Current with Industry Trends & "Best Practice"

Succession Planning etc.

Succession Planning, Development and Training Programs & Career Paths
  • Firm & Function Leadership
  • Investment Professionals
    • Portfolio Managers
    • Research
    • Risk Managers
    • Traders
  • Investment Business Professionals
    • Legal
    • Compliance
    • Technology
    • Marketing & Client Service
    • Finance
    • Human Resources, etc.
  • Assuring Integrity & Effectiveness of Succession Planning and Career Paths for:
    • Investment Functions Across Geographic Locations and Multiple Time Zones
    • Investment Business Support Functions Across Geographic Locations and Multiple Time Zones
  • Note: Directly Link Succession Planning and Career Paths to Workflow "Business Process Mapping" and Process Excellence "PEX" Initiatives (See "Transparency" Section)

Information Request for Services Listed Above