It's not often that you meet an executive at a burgeoning fund firm who is obsessed with distribution. In the first two years, most are still concerned with all the cool stuff they can do with their portfolios.
Not Mike West
chief executive of the Knoxville-based BPV Capital Management
The 20-month old firm already markets two funds, the BPV Core Diversification Fund
and the BPV Wealth Preservation Fund
, on 14 platforms, including Schwab
, Wells Fargo
, TD Ameritrade's
retirement channel and all of the channels on Fidelity
. It is also in talks with a major wirehouse and plans to announce deals with up to five other platforms in the next 45-days.
It also has four wholesalers, three business development officers, and five full-time (as well as two part-time) marketing people.
Not bad, considering the firm started in Fall 2011
, and rebranded itself soon after
All of this focus on distribution, West told MFWire
today, is by design.
"We decided from the beginning that we would have an organization with a developed distribution function," he said. "Most asset managers, when you ask them what they do, they'll say 'We invest,' we're focused on running this company like an investment business."
To that end, West and his colleagues are now looking to adopt promising alt managers that BPV can distribute on its platform.
West broke down the candidates they'd consider into two groups: a few guys in a garage with an interesting strategy but not a lot of interest in the headaches of bringing a fund to fruition (he said that there are roughly 60 such groups that meet their criteria here).
The other category would be successful hedge funds or SMA managers looking to bring their talents into the '40 Act Space. West said he was already in discussion with a top 200 manager of this type.
What West wants to market, is any kind of product that offers risk protection to clients. Of course, he is looking predominantly in the alt space. Adopting a long-only equity shop is a long shot.
"There is a need for risk-managed funds, funds that provide some protection against a crisis. If there is one thing I know, it is impossible to predict when a risk would hit, but you should always be managing somewhat against risk all the time," he said.
Who would be the targeted end-users of these products? Advisors of course who cater to people who appreciate this viewpoint. And West says that includes a lot of people.
For example, he noted that there is a client of one of BPV's funds who deposits $100 every two weeks into the fund. That amount is very much worth protecting, he said.
"I can't say for certain, but I'd be willing to guess that that $100 is very important for that client."
Stay ahead of the news ... Sign up for our email alerts now