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Monday, August 08, 2016|
With Two Alliances, an ETF Entrepreneur Steps on the Gas
The chief of an ETF startup in Southern California has sealed two key alliances in 2016 after quadrupling its fund lineup.
"Now that we've got more than one product, how do we take it to the next level?," Ervin asks. "We really wanted to step on the gas when it came to PR and advertising and really just the overall architecture of 'Who is Reality Shares?'"
For distribution, Ervin turned to Haverford, Pennsylvania-based Dakota Funds Group (outside Philadelphia). Ervin says he previously "shied away from third-party firms", yet he praises Dakota as "really process-oriented" and focused on "high-level RIA clients."
"They really make sure that everyone gets that story," Ervin says, calling distribution a "numbers game" that's about "advancing the cause down the field."
Founding partner Gui Costin created Dakota in 2006, and the independent distribution group now has 12 people, including 10 sales people. They focus exclusively on distribution, not on marketing, and emphasize "very deep home office relationships with banks and independent broker-dealers and RIAs." The team currently supports six asset managers with distributing ETFs, mutual funds, and SMA (but not hedge funds).
"We partner with those great, really world-class boutiques [that have] just-launched or want to launch mutual funds," Costin tells MFWire. "We've raised roughly $10 billion for our partners in the last ten years."
On the marketing side, Ervin turned to Los Angeles-based branding agency MBC. He praises the MBC team's experience with alternatives and ETFs and with marketing "into the financial advisor community."
"It's just too hard to build it internally," Ervin says.
Now MBC is helping Reality Shares "to ramp up and put out new literature on the funds" as well as with a "full redesign, re-messaging the story of who is Reality Shares and what do we offer in the market."
MBC founder Matt Brunini hails from the investment world and built a team "with pretty deep investment experience."
"We're helping [Reality Shares] with design, messaging and materials," Brunini tells MFWire. "We're helping them get out to market as well."
"We're kind of specialized as a West Coast branding agency that just works with finance and investment firms," Brunini adds.
Ervin, a former FA himself, founded Reality Shares in 2012, and their first ETF debuted at the end of 2014. He now has a full-time team of nine and about $45 million in AUM.
"We're pretty focused on our growth path. We have a long runway for that," Ervin says. "We knew it was just going to take a while."
Ervin says he's in "constant conversations" with other mutual fund shops and asset managers interested in "exploring the ETF industry."
"When we got our exemptive relief to issue ETFs, it was pretty broad," Ervin says. "We get propositioned every once in a while from a strategic standpoint ... Nothing is concrete there. The conversations are definitely occurring."
Printed from: MFWire.com/story.asp?s=54556
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