Panel Discussion Roundup: Building an Infrastructure & Service Provider Selection Under Increasing Cost Pressure for Emerging Managers

Eze Castle’s Director of International Technology, Jamie Smith, shared expert advice for emerging managers looking to build an infrastructure and select service providers under increasing cost pressures in the current climate, on a recent panel discussion at the Emerging Manager’s Forum: Europe.

The discussion covered key considerations to guide new fund managers around building an infrastructure that can grow with the fund, and on best outsourcing practices. Follow along for a roundup of key takeaways in this blog article. You can also the watch the panel replay embedded below to listen in on the full discussion.

Tips for Building an Infrastructure that Can Grow with your Fund

Since remote working has become the new norm, and indefinitely so due COVID-19, new fund managers are at an advantage to save on the premium costs associated with renting/purchasing office space in a central location. 

Therefore, the key infrastructure essentials we recommend for funds launching this year, and perhaps even next year (as we wait to see how things unfold), for productive and efficient remote working include:
 

• Strong network connectivity at user remote locations. Ensure your users have sufficient connectivity and bandwidth to support your fund’s day-to-day operations and use of programs. 

 

• Adopt a cloud first strategy. Funds are strongly advised to build their infrastructure in the cloud for cost effectiveness, to support remote working and any future expansions in your growth plan seamlessly. Microsoft Office 365 is highly recommended for emails and to support instant messaging and file sharing in real time, powering collaboration and workforce productivity from anywhere. It is also wise to opt for as many software-as-a-service deployments (SAAS) as possible, which can be scaled up/down in line with your business requirements. With this pay-per-use model, you will avoid any upfront costs and only pay for what you use, per user. For more on leveraging Microsoft O365 for remote collaboration, you may find our recent article helpful:
  • Top collaboration Tools with Microsoft: Teams, SharePoint and OneDrive

 

• Comprehensive security defenses. With all your new fund’s assets online and at risk, ensuring you have a bulletproof security strategy and sufficient practices and technologies in place is vital. Our recent blog articles cover this area in detail:
  • Maintaining Your Security Posture While Working Remotely
  • Securing Your Home Network

What Should a New Manager Outsource? 

Whilst each fund launch is unique with specific business requirements to make you stand out from the crowd, the panelists agree on outsourcing of the two areas listed below - right from the start, to help you focus on planting the seeds of success needed to hit the ground running. 
 

Infrastructure and Technology Build-Out 

Seek a trusted managed IT services provider to help you build-out and maintain a secure cloud infrastructure, so you are prepared for a continued period of remote working with guaranteed, hassle-free connectivity. As mentioned earlier, an important element of technology is the security of your overall firm and employees. This is important to not only protect your assets, but your overall security stance, as this is what determines how attractive you are to potential investors, and thus a huge element of the investor DDQ process.

Tips for Choosing a Technology Provider:

• Partner with a trusted IT provider who can handle all your needs; from the deployment of file services, infrastructure, email, portfolio management systems and security, if possible. An IT provider experienced in and dedicated to the needs of the Investment sector is recommended here to guide you on all things technology and compliance. And, with bundle services you will able to be operate more cost effectively, with a pay-per-month, per user model (which can be scaled as needed).

 

• Think ahead to future expansion/growth goals and assess if shortlisted IT providers will be able to support your fund as it grows both geographically and in head count.  

 

Finance

As with every new business, the financial element of launching a new fund can be overwhelming to someone who is launching a new business for the first time. Especially, as you are accountable for all other departments too, which can come as a shock if you have never previously been self-employed. So, to help you manage this crucial element of your business effectively, ensuring you are on top of all important deadlines such as tax, salaries etc. (which if missed can become an administrative nightmare), the panelists suggest outsourcing the finance element to an experienced provider, especially well-versed in new fund launches. 

A Friendly Word of Advice on Outsourcing

The panelists encourage emerging managers to outsource but remind you that the outsourced function is still your responsibility. The outsourced provider should act as an extension to your business, and thus you should be involved at all stages, at least initially whilst you are in the setup phase and are determining practices and procedures around everything.

New funds are specifically reminded to be clear on where information is being stored and ensure adequate data loss protections are in place. It is also good practice to ensure you are checking in with service providers frequently, to ensuring any monthly, annual and bi-annual testing and/or renewals are taking place as required. 

We hope you found this article informative. Watch the video below to listen in on the full discussion to hear the seasoned experts share tips for emerging managers.

 

If you’re looking to launch a new fund and would like to seek the advice of one of our experts, please reach out here.