3 Customer Success Ideas for Improving Hedge Fund Investor Relations

Lindsey Perez wrote this on June 13, 2018

You may be asking yourself, “What does customer success have to do with investor relations?” From my experience as someone who has worked in one function helping those in the other, they have more in common than you might think.

On the surface, it may not seem like these roles are much akin to one another at all - one is usually associated with technology companies and the other with financial services. To be sure, there are obviously some differences. Namely, I don’t know too many customer success professionals that require a working knowledge of financial products, such as Securitized Fixed Income or Global Convertibles.

Yet, if you examine responsibilities and traits required by people in these two roles, you start to see how similar the roles of hedge fund investor relations associate and customer success manager are. Let’s take a closer look.

So, what can we learn by making this comparison? Well, we’ve seen the tidal wave of customer success roll through the technology sector to great...uh...success. And now we’re seeing many of those customer success principles brought to other non-tech organizations.

With so many similarities between these two functions, it seems wise to ponder: What CS concepts can IR teams apply? Here are a few ideas:


Use this role as a differentiator

Yes, the asset management space is a performance-driven environment. But, smart private fund managers are working to elevate their IR practice from the administrative toward the strategic. Gone are the days of simply distributing a quarterly letter and waiting for investors to reach out to you for things.

With the growing importance of institutional investors, anticipating client needs before they do and fulfilling them can make all the difference. Investor relations teams that look for ways not only to satisfy investor requests but also to continually enhance the investor experience are those that get ahead.

Investors will be much more likely to stick around through dips in performance if they 1) are having a good overall experience, and 2) have a solid understanding of the value of the investment, even if the short-term returns aren’t great. Both of these situations are more likely to exist with a strong investor relations function.

In the fiercely competitive fundraising environment of today, a track record of excellence and innovation in this role can lead to more subscriptions.

Actively manage your investor portfolio

Just as the fund manager carefully builds out her portfolio of companies, view your investors through that same lens and manage them strategically. Segment your investors by capturing and tracking the qualitative and quantitative data that helps you better understand them and their needs and then craft tailored engagement programs for those segments.

Viewing your investors as a portfolio also can help you develop strategies to grow and retain capital. Keeping track of things like the level of effort it takes to serve particular clients and whether an investor has referred new business

your way or acted as a referral, along with noting their investing preferences and desired outcomes aids in assessing your own ROI, Return on Investor. We’ve discussed this concept in terms of calculating your ROC, Return on Customer; but the concept could be applied to investors as well.

Leverage technology to increase your impact

The right mix of tools can help you do more with less. Start by standardizing processes and practices to deliver consistent and dependable service. Then, move on to find innovative ways to use technology that allow you to offer additional services that help you stand out from other funds.

Some processes that are particularly well-suited for being improved with technology are those around communications and processes at critical points in an investor’s journey with you, such as onboarding or investor meetings. Some tools to consider are marketing automation platforms and CRM systems, like Clienteer.

These tools can be used to automate processes like sending your regular performance and risk reporting, aggregating email communications with your investors from across your team to better collaborate, and tracking the steps you need to complete when certain processes are kicked off.

All-in-all, I see a lot of alignment between these two functions. These are a just a few of many good practices and ideas that can be adapted from the customer success world to that of investor relations (and likely vice versa!).

Drop me a note if you have more thoughts on the topic. I would love to hear them. And if you're interested in learning how a solution like Clienteer might fit into your evolution: Request a demo!