Third Party Marketing Companies: The decision to hire a third-party marketing agency is a significant step for any asset manager or hedge fund looking to enter one or more new markets. These specialised service providers distribute funds, develop tailored market and distribution strategies, and provide access to local investor networks.
But what exactly differentiates a mediocre from a great third-party marketing agency? What should you look out for when choosing one? In this article, we explain the key criteria and considerations for a third-party marketing agency and provide helpful tips on what to look out for when choosing one.
What exactly is a third-party marketing agency?
A third-party marketing agency is an external company that specialises in the distribution and marketing of investment products such as investment funds or hedge funds. It acts as an agent for the asset manager, helping it to place its strategies in new markets – often in regions where the asset manager does not have its own distribution structures and investor contacts.
The main tasks of a third-party marketing agency include:
- Fund distribution: the agency presents the asset manager’s investment funds to potential investors in order to acquire capital.
- Market entry strategies: development of strategies for entering new markets, e.g. in the European Union (EU) or the DACH region (Germany, Austria, Switzerland).
- Access to local networks: thanks to its existing relationships with institutional investors and distribution partners, the third-party marketing agency can quickly establish contacts with investors.
- Compliance and legal support: The agency ensures that all marketing and sales activities comply with the regulatory requirements of the respective country.
- Marketing and PR: Support in positioning the asset manager’s brand and all marketing and communication activities.
- Investor relations: Cultivation and support of existing investors, upselling of strategies/products and acquisition of new investors.
- Organisation of roadshows and events: Planning and execution of investor meetings and events to present the funds.
What are the advantages of using a third-party marketing agency?
A third-party marketing agency offers numerous advantages, particularly for asset managers looking to expand internationally.
Local expertise: Access to local expertise is a key advantage. Each region has its own market characteristics and regulatory requirements. A third-party marketing agency is familiar with these specifics and can ensure that all sales activities comply with local conditions.
Cost efficiency: Setting up your own distribution structure in a new market is often costly and time-consuming. An agency can accelerate this process and reduce costs, as no in-house teams are needed on site.
Access to networks: Thanks to their established contacts with professional investors such as banks, asset managers, family offices, pension funds, foundations, insurance companies and distributors, a third-party marketing agency can start marketing immediately. This saves time and facilitates market entry.
Tailored go-to-market strategies: Every fund is different, and a successful marketing strategy must be aligned with the fund’s specific objectives and strengths. A good third-party marketing agency offers tailored strategies that are aligned with the specifics of the asset manager, the investor target group and the market.
What should you look for when choosing a third-party marketing agency?
Selecting the right agency is crucial to the success of the partnership. Here are some factors to consider when making your choice:
Experience and track record: Look for an agency with a proven track record of distributing funds in the respective region. A third-party marketing agency that has already worked successfully with international asset managers will be able to offer you better access to the right investors.
Regulatory expertise: Each region has its own regulatory requirements. An agency that is familiar with the regulations of the respective markets can ensure that all activities are legally compliant and that there are no risks for the asset manager.
Strength of the network: A strong network is key to success in fund distribution. Check whether the agency has access to the right investors and whether these contacts match your funds.
Adaptability and flexibility: The best agency will be able to customise its services to your specific needs. A one-size-fits-all solution rarely works. Look for an agency that offers you tailored solutions.
Transparency of fees and structure: A clear overview of costs and commission structure is crucial. Clarify the various pricing factors such as commission on acquired AUM (assets under management), monthly retainer, set-up costs, commission tiering and marketing costs.
Ongoing support: A long-term partnership requires regular communication and reporting. Choose an agency that will keep you regularly informed of progress and is flexible enough to respond to market changes.
How FundFinity stands out
FundFinity is a specialised third-party marketing agency that supports international asset managers and hedge funds in successfully marketing their strategies in the EU and DACH region. Our strengths lie in our deep understanding of local markets, our close relationship with institutional investors and our tailored approach to each fund strategy.
At FundFinity, we emphasise clear communication, transparency on fees and a flexible approach that prioritises our clients’ individual needs. Our track record and strong network in the EU make us a trusted partner for asset managers looking to expand into new markets.
Conclusion
A third-party marketing agency can be a valuable partner for asset managers or hedge funds looking to expand internationally. However, selecting the right agency and working together successfully depends on clear communication, flexibility and a high level of commitment from both sides.
Are you ready to take your fund distribution to the next level? Contact us now to find out how we can successfully market your funds in Europe.
