Berntsen: Intermediaries Push Emerging Managers to Pitch Prematurely
Erik Serrano Berntsen · Erik Serrano Berntsen – Backing Alternative Founders at Stable Asset Management (Capital Allocators, EP.218) · Oct 18, 2021 · at 34:51
Erik Serrano Berntsen, CEO of Stable Asset Management, discusses common pitfalls emerging fund managers encounter during their initial capital-raising process.
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“So a lot of emerging managers tend to go to market way before they're baked. And it's interesting because structurally the industry propels them to do so. So for instance, in public markets, you have, you know, cap intro teams and private markets, you have placement agents. Their role is to connect managers to investors and they want to be helpful to the manager because they want to work with them and they want to be helpful to investors because ultimately those are the allocators who are going to invest with the managers they work with. But the issue is that that creates this Sense of urgency to be the first to present this idea. And what ends up happening is the manager doesn't have a well-baked idea on how he's going to structure the business, has not managed to figure out how to explain easily what they do. And that leads to what we call scorched earth.”
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