Confident, Client-Centric, and Committed: New Research Reveals Boutique Asset Managers’ State of Mind

No one could anticipate the havoc the rapid spread of COVID-19 would wreak upon the global economy, including most asset managers.

In this unprecedented environment, Sondhelm Partners wanted to get the pulse on how boutique asset managers are handling this crisis in a variety of areas, from dealing with lower revenues to adjusting their sales and marketing practices to reflect the current stay-at-home working environment.

In April, we surveyed 55 C-level executives at boutique firms to capture their feelings about the state of their business and the effectiveness of their business development, digital marketing and public relations efforts.

We’ve collected their responses in our new research report, Weathering the Storm: How Boutique Asset Managers are Adjusting to the New Reality.

Download the complimentary report now.

Survey Methodology and Respondent Demographics

The 55 respondents answered more than 20 questions covering a wide range of topics, from business development, sales and marketing to client service, staffing, product development and financial stability.

They were encouraged to add comments, some of which are included in the report. To encourage participation, for every survey taken we donated to charities that support COVID-19 relief efforts.

One of the key objectives of this research was to see if their evaluations of their business practices have improved or declined over time. To collect this data, we asked them to rate these practices both in the current environment while also asking them to retroactively evaluate how effective these same practices were in the spring of 2019.

Most of the respondents come from smaller firms. Thirty-eight have $3 billion or less in assets under management, ten have between $3-$30 billion and seven manage more than $30 billion.

Their primary clients are institutions (70%), followed by advisors (52%) and affluent individuals (34%). Note that respondents could choose multiple audiences.

Key Findings

Contrary to expectations, most boutique firms are not suffering massive outflows, teetering on bankruptcy, shedding personnel, scrambling for cash or looking for larger firms to buy them.

  • Approximately 53% experienced a net increase in assets under management from the spring of 2019 through April of 2020.
  • Only 11% are considering layoffs or across-the-board pay cuts this year.
  • Only 16% said they need additional cash to remain solvent.
  • Only 7% were considering selling their firms or funds.

While many firms are delaying product development efforts, and while all have curtailed on-site visits, they are strongly committed to leveraging their sales and marketing teams to retain existing clients and remain engaged with prospects.

  • 84% are actively engaging with prospects, even when the news is not good.
  • 65% believe they are still doing a good job of generating leads.
  • 67% believe their salespeople are more effective than they were a year ago.
  • 73% feel that their story and positioning are resonating in the marketplace this year.
  • 89% are committed to giving clients and prospects access to their portfolio managers, either via webinars and conference calls or through market commentaries, blog posts, videos and podcasts.

With digital marketing having to step up to the plate to replace on-site interactions, most boutique asset managers realize that they need to improve their effectiveness in many areas.

  • Approximately 40% believe that their websites, email marketing, social media and public relations efforts are effective.
  • With webinars and videoconferencing becoming the “new normal” for business meetings and presentations, only 38% believe their virtual communications programs are as good as they could be.
  • The only area where the majority feel they are doing well is in content development, where 56% believe their efforts are effective.

In terms of improving business development efforts, the highest priority items on their “to-do” lists are:

  • Retaining clients (96%)
  • Attracting leads and prospects (88%)
  • Remaining engaged with clients and prospects (88%)
  • Effectively communicating their story and positioning (87%)

The report is sponsored by Discovery DataSalesPage and Cohen & Co. Media partners include Fund Intelligence and Emerging Manager Monthly.

Want to Learn More?

Download the complimentary report now. If you have questions about the report or want to receive a complimentary consultation, schedule a time on my calendar that works for you.

Dan Sondhelm is CEO of Sondhelm Partners, a firm that helps asset managers, mutual funds, ETFs, wealth managers and fintech companies grow through marketing, public relations and sales programs.