Last Friday, The New York Times posted an article entitled “With Ban on Ads Removed, Hedge Funds Test Waters.”
The article talks about the recent ad run by a $4.3 billion hedge fund entitled “Performing In All Conditions.” This ad is a result of the new JOBS Act, which by now I am sure you know gives the hedge fund and financial services industries the ability to advertise to the general public.
In the past several months, I have met with several funds and financial services firms and we have spoken about the JOBS Act and what their thoughts were. Not surprisingly, I find that most people I talk to are completely divided. Some say that they feel it is completely silly to advertise and that their fund is private and they would like to keep it that way. Others tell me that they are waiting on the sidelines to see what other firms do. I don’t think there is a true right or wrong answer here. What I can tell you is that an advertisement may or may not be necessary, but a complete brand audit is.
What is a brand audit?
A brand audit entails hiring a firm to do an audit of your sales and promotional materials. They evaluate everything from your logo and Web site to your pitch book. Does what you are putting out to your stakeholders instill confidence? Does it make people take notice? Does it look professional or does it look amateurish? Some companies spend millions of dollars a year on branding efforts to make a consumer feel comfortable and want to buy. No, you are not going to spend millions of dollars. You may not even spend $10,000, but a small investment will instill the confidence that your investors or potential investors may need to take a position or hold their position. It’s about Investor Confidence.
An ad in a major publication may or may not be for you, but a brand audit can certainly put you on the right track to growing your fund.