samadvisory tag:www.samadvisory.com,2008-03-05://1 2011-04-24T19:37:44Z Movable Type Pro 4.32-en iPad for business productivity tag:www.samadvisory.com,2011://1.152 2011-04-24T16:34:41Z 2011-04-24T19:37:44Z Sanem http://samadvisory.com Do you use technology to make your business life richer and more efficient?  

Up until last year, I simply couldn't find enough time to keep up with all tech advances... I didn't have many contacts in the finance world who embraced technologies like smartphones or mobile apps that go with them, let alone guide me.  

All of this changed drastically after I had the opportunity to work on a tech startup and experiment with some amazing new tools myself.  Since the introduction of iPhone on Verizon and the arrival of iPad, I now also have many more friends interested in knowing which apps are worth downloading...
]]> Having used every Apple device over the past two years, I am completely biased towards the iPad when it comes to boosting productivity and a richer, more engaging experience overall.  

As for apps compatible with iPads...

- SoundNote:  I use this app like a notepad.  It records the meeting, and allows you to search by word, recording time, and even lets you quickly save your new docs to a Dropbox folder.
- Dropbox:  Think about a new drive/folder on your computer, which you can drag & drop your favorite documents (be it large recordings or photos or notes).  Dropbox automatically synchronizes all of these docs with the dropbox app on your ipad.  You can open and work on these docs anywhere any time your iPad is connected to the Internet.
- Pulse:  Many newspaper and magazine publishers have launched their own apps, which clearly offer a much better way of enjoying their paper publications.   While I have really enjoyed some newspaper apps like Financial Times or NY Times, I now prefer this Pulse app that lets me create my own custom newspaper/magazine.  
- Flipboard:  Like Pulse, aggregates a lot of interesting content from sites such as TED Talks, Lonely Planet and National Geographic.  I prefer Pulse for news, Flipboard for a richer visual experience.  For magazine lovers, I would also recommend Zinio.
- Bloomberg:  If you need access to the investment world, this app is quite good.
- Kayak:  Great for travel arrangements.
- TomTom:  All you need is a subscription to the maps of the country you will be in, and you can leave the iPad on the car dashboard/seat next to you as TomTom announces all directions with the help of GPS.  You don't even need to look down to see the map.  Who needs Garmin!
- GoodReader:  If you open up documents in Goodreader, the quality is as good as on your screen.  All you need is an HDMI connector TV to start showing your presentation on the TV in the room!
- Printopia:  Installing this on your computer will allow you to print or save to PDF any document or page you are reviewing on your iPad.  A must...
- Instapaper:  This app allows you to save any webpage for offline viewing.  Great for preparing for wifi-free subway rides.   
- YellowBook:  Like yellow pages, but better on your iPad
- Free Translator:  For those who travel and want to say a few words in the countries you are visiting
- Open Table:  Same as the desktop app, for searching for a table at a restaurant
- PingChat:  Free texts wherever you are (receiving or sending)
- IM Pro+:  Combine all Skype, AOL and other text services in one screen
- FaceTime:  Amazing app, with one click, clear video and sound -- as long as the other party is also on FaceTime.  If your friend doesn't have FaceTime, then Skype will do the trick as well.
- AudioVroom:   This app gives access to millions of songs with one single click based on your own preferences. If you never listened to music on your iPad, just listen to the first few tunes offered by this app and rate them, so future playlists are refined to meet your preferences.  Then find another person whose music taste you are curious about or like, bump your devices, and start a brand new playlist.  

Most of the above apps are available on iPod Touch and iPhones.   I would recommend spending a few hours on the AppStore each sunday to browse through all categories and picking a few new apps to try... 

Enjoy!
]]> Regardless of sector, an entrepreneur is always an entrepreneur tag:www.samadvisory.com,2011://1.151 2011-03-26T18:39:44Z 2011-03-26T18:48:56Z Sanem http://samadvisory.com Finance is one of the most lucrative careers post-graduation--an incentive for my own entry into that sector about a decade ago.  The following research report about the finance sector stifling innovation and entrepreneurship got me thinking about my path in finance: www.kauffman.org/newsroom/expanding-financial-sector-depleting-pool-of-potential-high-growth-company-founders.aspx  

I have always been quite entrepreneurial even in finance.  Would I have been more impactful and successful had I chosen the start-up route in a different sector?  My take is, impact and success does not depend on the sector;  it is very much a function of who you are and what your ultimate goal is.  
]]> While my career on the surface has revolved around building financial asset management businesses, I have never focused my sole attention on finance.  I helped my family set up a medical practice in a different city, advised a friend on her entertainment venture strategy, and supported another friend with his revolutionary energy-focused project.  At times when I had little time to work on a start-up in an industry other than finance, I stayed current by reading about and observing the growth of start-ups in other areas from software to real estate.  It has been particularly helpful to be surrounded by a network of friends and family with diverse interests and experiences.  I was able to gain a fuller perspective on what is out there beyond financial asset management.  Over a decade, it has therefore not been difficult to develop my own framework around what drives successful businesses.

In hindsight, my extensive work with financial start-ups has actually given me an advantage in working with other sector start-ups.   Clearly, studying business management twice (BBA and MBA) was instrumental in the way I think about start-ups and connect with people around me.  Taking coursework in areas such as operations management or tech marketing has allowed me build solid businesses that are viable and sustainable.  What has been even more crucial, moreover, was the hands-on work experience at financial start-ups:  I had the opportunity to work closely with fourteen teams in a dynamic and new sector (alternative investing), building firms without guidance from any sector textbooks.  I saw several times how a business can grow in three months and fail just as quickly.  I observed how people's reactions change drastically from good to bad times.  And I saw the impact of media on the progress of these firms.  All of that have made me appreciate how important it is to not get blindsided by success and save for a rainy day and strive harder to stay on course.

Regardless of industry, my takeaway is that every start-up needs to raise the capital to hire the best team that can develop its products and business, put in place the most suitable strategic partnerships, and most importantly, have that team execute as efficiently and effectively as possible.  Without a group of hard working entrepreneurs who think big, it is tough/impossible for any start-up to generate great long-term momentum and results.

Unsurprisingly, music technology is no exception.  My start-up experience from the finance world was fully and immediately transferrable, despite a new set of products.  About a year ago, I started working part-time with a tech developer team, initially launching a corporate structure around their basic concept and letting them manage product development with the right funds to operate.  I had full faith in this team's ability to handle every project without micro-management.   By the Fall of 2010, I became fully engaged to build the actual business.  Here, my experience with other start-ups (from legal to operations) played a key role in executing quickly:  Within a month of my involvement, I negotiated three major music licensing and partner contracts, guaranteeing our preferred start-up rates to give our company some additional support during the initial months.  The team and I also connected with several industry experts to design and execute the best business development strategy, including marketing.   

Before the first product hit the market, we had already heard from a number of strategic partners and industry experts (even press) that our new solution for music fans could actually be the long-term winner--with almost everyone giving us thumbs up on the progress we made in a short time.   Not bad for a tiny and young start-up in technology!   However, none of this has made me super-excited about this company's potential to survive.  I know the survival odds are no different than in any other start-up venture.  My whole team and I are still working diligently to make this company stay on its course and prosper in the long run.

So what is so different between financial start-ups and any other start-up?  Not much beyond the product line... Whoever launches the best financial company and acquires most of the customers tends to succeed, earning a lot in the process.  No different than Steve Jobs & team at Apple, or Pfizer with a drug like Viagra.  And whenever a start-up fails, everyone goes down with it.  No milestone is a guarantee of future success.  

Taking all that into consideration, I can confirm that the finance sector did not stifle my entrepreneurial nature or ability to start a new venture in a different sector, even while working full-time on financial ventures.  I happened to choose one sector and tried to make the most of it.  And now I can apply all those skills to new sectors more efficiently.  An entrepreneur is always an entrepreneur, and will always find the highest growth path wherever s/he is.
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]]> Risk Reporting tag:www.samadvisory.com,2010://1.150 2010-11-22T16:40:43Z 2010-11-22T16:55:38Z Sanem http://samadvisory.com There is no formal industry guideline or standard when it comes to hedge fund risk reporting.  Each manager tends to adopt a template s/he likes most.  Often, these documents are sent by a trusted advisor, such as a prime broker or an experienced investor relations professional.  It is really up to the manager to report the fund's data accurately and clearly.  

One of the first projects I get involved with as I start working with a new fund is understanding what the fund managers view as risk and finding better ways of reporting those data.  
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]]> For example, most funds investing in equities long and short have similar ways of evaluating the universe of stocks:  by sector, region, market capitalization and liquidity.  In that case, why not create a standard risk report for all equity long-short funds?

The risk report template I had created when I first started working with hedge funds almost a decade ago is now a comprehensive document that many investors and business contacts find very informative and intuitive.  There are no graphs, colorful charts with round numbers.  The document (3-4 pages at least) comprises detailed risk tables, presenting exposure to all major sectors, regions and market capitalization on a monthly, quarterly and annual basis.  Everyone who picks up the document can easily follow the changes month to month and see if the fund manager's "story" makes sense.

Given how popular this document has become in investor meetings, I now make it available to any fund interested in creating standardized reporting.  If you would like a copy, please feel free to contact me.
]]> Emerging Managers vs. Institutional Investors tag:www.samadvisory.com,2010://1.149 2010-10-19T12:32:12Z 2010-10-19T12:40:37Z Sanem http://samadvisory.com There is never a shortage of news or opinion articles in the media about the growing interest of institutional investors in the hedge fund business.  After all, some hedge funds have certainly offered investors with potentially very attractive risk-adjusted returns, which many pensions and endowments can use in today's environment.  However, as of now, it still does not quite feel like most institutional investors have a tested game plan or direct investment mandate to allocate capital to this investment opportunity set they seem not to understand--especially up and coming, emerging hedge funds which tend to have the greatest return potential.      

In that case, how does one approach institutions for hedge fund business development during the early days of a firm's life? 
]]> In the process of building hedge fund businesses in Asia and the U.S. over the last decade, I have had numerous conversations with major asset allocators ranging from U.S. or Australian government pension plans to family or corporate endowments--each managing well over billion dollars.  There are always one or two opportunistic, experienced and flexible firms in that community, but the majority of investors are still looking to their consultants to educate themselves on how to evaluate and invest in hedge funds.  

Unfortunately, many of these intermediaries themselves are in a "learn-on-job" mode.  Often, hedge fund business development is limited to a handful of "funds of funds" (FoF) that leverage existing relationships to win institutional mandates.  Furthermore, and not so great for emerging managers, this institutionally-oriented intermediary group has extremely strict asset level criteria for fund selection:  They often ignore many great, truly emerging funds (less than half a billion dollars under management).

As many studies indicate, the best time to get to know a manager is in the fund's early days, when the manager is truly focused on building the business and performance for the long run, and has the greatest drive to succeed.  If the manager doesn't make it during that first two year window, s/he will likely struggle to grow the firm for years to come.  Accordingly, hedge funds generally are on the fastest growth path right after launch.  In fact, as assets flow into funds and managers become comfortable receiving sizable investments from large allocators, performance often drops down on the manager's priority list, as per several published studies on this topic.

The good news for emerging managers is that this trend of "a select group of emerging manager intermediaries" is likely going to reverse within the next year.  For example, up until 2010, there was little--if any--interest among emerging manager consultants when one looked at the hedge fund space.  There are, on the other hand, several well-established emerging manager specialists overseeing multi-billion dollars in traditional long only, real estate or private equity mandates.  Within the last year, I have come across at least four interesting firms that have identified this emerging manager recommendation angle as an attractive way to grow their businesses and are having traction with institutional allocators.   With the arrival of these types of specialists in the hedge fund world, we may see an interesting shift in the way pensions and endowments around the world are educated on how hedge funds grow and perform.

All of these developments make it that much more crucial for hedge fund business development heads to consider as many alternatives as possible--and as early as possible--to get to know these newcomers to the institutional intermediary space and identify those pension / endowment investors that are looking to educate themselves over the next couple of years.  The key words here are "education" and "over the next couple of years."    

For those emerging asset management firms that are most proactive in building key relationships with a variety of institutions and their existing and new consultants, there certainly are many interesting growth opportunities in the institutional fundraising area.
]]> First, Admit You Need Help tag:www.samadvisory.com,2010://1.148 2010-05-11T02:42:48Z 2010-05-11T02:52:31Z Have you ever noticed how talented individuals, when they get together in a room without focus, can forget what their target is?... Sanem http://samadvisory.com Have you ever noticed how talented individuals, when they get together in a room without focus, can forget what their target is?]]> About a year ago, I met a smart portfolio manager, who was looking for someone to hold his hand as he formed a new hedge fund.  We got to know each other in three meetings, discussing every detail and process he wanted me to work on.  His strategy was compelling, and his pedigree and achievements would make him stand out in the business.  Then, I met his business partner, who was supposedly more focused on the portfolio and less on business matters.  That impression quickly disappeared when that partner came into the room and started questioning why they needed a consultant in the first place.   Needless to say, I was quite surprised--feeling like a marriage therapist!  This was a conversation these partners should have had long before I got there.  

Coincidentally, the same firm's name came up in a conversation with a hedge fund investor last week.  This investor said he couldn't figure out what bothered him about this firm despite four interviews.  He had apparently met with the investor relations rep and each of the two partners one by one, and asked for one last meeting with both partners in the room to address some remaining questions.  The fourth meeting was meant to close the loop and help the investor make the final investment decision, but ended up confusing him altogether.   He walked away thinking there is something odd about the relationship of the business partners.  Now this is normal and partners don't always see eye to eye, but I am seeing a trend...

Had they been open to working with someone experienced to help them focus their message and avoid such internal miscommunication, they could have easily won this investor over.   This is not the first time I have seen a situation like this.  And it begs me to question when some fund managers will drop their egos and let professionals do their job by helping them. 
]]> Hedge Fund Marketing tag:www.samadvisory.com,2010://1.147 2010-04-06T13:15:08Z 2010-04-06T13:17:18Z Sanem http://samadvisory.com One of the most time-sensitive projects I focus on at each start-up is the design of a marketing strategy and the engagement of the best people in the HF industry to execute that plan.  To my surprise, quite a few portfolio managers choose to launch their firms without an effective game plan when it comes to fundraising for their own businesses.
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]]> The feedback I hear most often when I present such portfolio managers with a marketing strategy is that regardless of where their firm representatives travel to and whom they contact, they should just focus on approaching as many prospects and trying to sell the new "product." My reaction is "are you really just selling a product?"

Let us think about what a traditional hedge fund offers:

- Access to some of the brightest investment professionals in the financial world who choose to provide their services only for the most qualified, knowledgeable and experienced investors
- Trust in a portfolio and risk management team which seeks to identify those unique opportunities that average market participants cannot locate as efficiently or cheaply (i.e. the team has a unique investment edge)
- Ability to invest capital in a (fund) structure that provides the portfolio team with the greatest flexibility, even if the investor has to abide by numerous guidelines when it comes to high fees or long investment lock-up periods

As long as hedge funds are such unique and non-mainstream investment vehicles, then why should any portfolio manager assume that a basic institutional fundraising campaign is the most effective marketing strategy for the new hedge fund?  I often propose that a hedge fund avoid focusing on "pushing" products, and instead spending most of the firm's marketing resources on the education of the right target investor base.

For example, start by identifying a small target prospect group who tends to appreciate your firm's investment edge and has had some prior experience investing or at least evaluating similar strategies.  Arm those investors with the right data points and firm facts over the following 1-6 months.  Slowly expand that prospect group as you nurture the initial relationships and identify similar investors.  Accept upfront that the firm is not selling research, a product or service everyone is familiar with--and that this relationship building cycle can take a while.

By avoiding the typical financial firm marketing mindset of "selling something," portfolio managers who later own and run their hedge funds have a greater shot at building a long-lasting business with investors who want to "partner" with them.
]]> The most important hedge fund hire tag:www.samadvisory.com,2010://1.146 2010-03-27T19:47:01Z 2010-03-27T19:58:26Z Sanem http://samadvisory.com One of the least understood roles at hedge funds is that of the person overseeing the setup and growth of the firm's infrastructure.   Depending on the fund, the title and background of this person can vary greatly:  President, CEO, CFO, COO, Head of Business Development, Head of Administration, Partner, VP, Senior VP...   There is absolutely no industry standard!]]> The people who assume this type of a "business manager" role tend to be given responsibility for some major projects during the pre-launch as well as later stages:

- Negotiating important contracts with employees and external service providers (fund custodian to auditors or banks), and managing relationships with all of these parties
- Designing and following a budget
- Renting office space and securing technology, office equipment and business staples
- Ensuring the fund assets and investments are accounted for by engaging accountants and tax professionals internally and externally
- Assisting the portfolio research team with any trading or investment related projects that require a business manager's involvement (for example, a unique investment that may not be easy to value or store)

Given these projects can have a major impact on the success of a business, why not institutionalize this particular role at hedge funds and look for talent in a more methodical way?   

In my view, those firms that hire the best talent for this particular "business manager" role are likely to make it a lot farther than those firms that cut corners by not hiring a dedicated business manager or hiring someone not well trained to do the required work.

For example, look for a skilled CFO who can think strategically about different firm projects, from recruiting to finances to fundraising.  This person will likely be a great addition to the team and step up and act as a business manager.   Avoid hiring old friends or family whom you think you trust, respect and like.  Any relationship can turn sour quickly; it is more important to hire someone whom you don't know well, but whom everyone else respects enormously and speaks highly of.  Finally, do not hire someone who may have managed a team but never had exposure to hedge funds.  The hedge fund business has very unique needs and not everyone can adapt to its high pressure, high speed--thus truly demanding--nature.

]]> What makes a good fund manager? tag:www.samadvisory.com,2010://1.144 2010-03-26T20:48:04Z 2010-03-28T00:18:37Z Sanem http://samadvisory.com From where I sit, the most enjoyable aspect of starting a new venture is bringing and keeping together a unique team. 

I have so far worked with over a dozen teams around the world from Tokyo to Singapore to New York.  Imagine the diversity of personalities, nationalities, religions, educational and family backgrounds!  These teams have ranged from small to large, emerging to experienced, and seeking seed investors to well capitalized. 

Here are some red flags I now avoid when I evaluate fund managers as business partners:
]]> -       Transparency:  Does the fund manager believe in long-term compensation, which is fair and transparent?  Avoid those leaders who promise discretionary bonuses based on multiple criteria, especially if you have no way of meeting these guidelines.   For example, if you are the firm marketer and the fund manager wants to compensate you with a year-end bonus based solely on that year's fund performance (i.e. not your objective results), think twice about signing that contract.

-       Scale & Scope of Work:  Do you have a good idea about what kind of responsibilities you are expected to take on and what kind of results are expected?  Best to avoid situations where you are asked to assume new responsibilities without renegotiating related compensation/title/recognition that you feel most comfortable with. 

-       Micro-Management/Oversight:  You have been delivering good results and have a well-established work flow, but suddenly, your boss decides to micro-manage or have someone else oversee what you do.  Address those types of conflicts by asking smart questions proactively.

-       Colleagues:  Are your colleagues disgruntled about working for the firm?  Do they have plausible concerns about the fund manager?

Many of us have numerous observations each day, some of which are worth ignoring and others that are important to pay more attention to.   Based on my experience, I find that it helps enormously to stay focused and reflect periodically on what kind of people and organizations I work with.   

At the end of the day, success depends on not just the nature of the products and service we deliver to our clients, but also what kind of people we partner with. 
]]> Welcome to the new SAM Advisory blog tag:www.samadvisory.com,2010://1.143 2010-02-28T00:55:33Z 2010-02-28T01:31:42Z During the last decade in the investment world, including the five years SAM Advisory has been in existence, I have had the great pleasure of collaborating with some of the most insightful, experienced investors and investment professionals around the world.... Sanem http://samadvisory.com ]]> My work has taken me everywhere from Rio de Janeiro to Tokyo, from Budapest to Dubai.  I have been exposed to interesting investment strategies ranging from currency trading to natural resource equity/commodity investing, and learned from the finest minds around the world.  

By assuming responsibility for an important part of each business every time, I have had the opportunity to help my partners focus on their core functions as they built new firms and introduced unique products.  

My reward in the end has always involved seeing each start-up become a small-scale institution and a firm well-recognized globally in its unique sector.  

This new blog is intended to be a brief trail of some of these experiences and observations.  I welcome any suggestions and comments along the way.  

Thanks for the visit!


DSC02670.JPG     Hong Kong, 2005
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