Less than five percent of SEC registered hedge funds are prepared to take advantage of the new advertising rules, according to the white paper How to Market your Fund under the New SEC Rules.
Its analysis of more than 3,100 SEC registered funds showed that fewer than one in 20 had developed a public website, putting them out of reach of new investors, according to research cited in the paper. It also discovered roughly 80 percent of the funds registered with the SEC in Connecticut, identified as opportunistic in strategy, didn’t even have an email address for potential investors to contact.
The white paper was published in July 2013 by the PR firm MaciasPR and can be downloaded by clicking here.
Most hedge funds never developed an online presence fearing it would give the impression of skirting the old SEC prohibition on advertising. These hedge funds are at a huge disadvantage now that they are entering the modern world where a prominent online presence is crucial to marketing your fund.
Marketing a fund with the media is drastically different than marketing a product to the public. Every fund needs credibility before the media will even consider putting a portfolio manager on TV or quoting him as a financial expert. This is why he says it’s so crucial for all funds to establish credibility now with a strong online presence.
The white paper, How to Market your Fund under the New SEC Rules, outlines five steps hedge funds must take now to market their funds to investors.
An excerpt from the white paper includes the following steps for marketing a hedge fund to investors under the new SEC advertising rules:
Establish an Online Presence
There are multiple ways to design a website, but most developers and content marketers agree that an HTML website is better than a Flash website. Search engines like Google and Yahoo can’t read the content within flash so it makes it harder for flash websites to get picked up by search engines. What good is having a website if Google can’t find it? In addition, flash is not compatible with mobile phones, which means anyone who goes to your website from their phone won’t be able to read your content. The world is gravitating towards mobile so most developers agree it’s only a matter of time before flash websites are transitioned out. The white paper recommends developing an HTML website over a flash website.
Establish Credibility before any Media Outreach
Credibility matters in life, but it especially matters for journalists, says Macias who was a journalist for NBC, CBS and King World Productions. Whenever a portfolio manager is pitched as an expert to the media, journalists will quietly and overtly measure his expertise, integrity and experience in the financial industry. If a reporter doesn’t see an online presence on your fund, credibility questions will be raised, Macias says. Here are a few credibility questions you should be able to address and answer before your fund pursues media placements.
Q) What makes you qualified to speak on this topic?
Q) How many years of experience have you spent in the industry?
Q) How big is your fund in comparison to others?
Q) How much of your daily routine reinforces your expertise as a portfolio manager?
Q) What do you know as an insider that other investors would want to know?
Develop a Content Marketing Plan
Your team of analysts already has a wealth of research that could be turned into white papers, blogs, articles or editorials that could be marketed on the web. This is known as “content marketing.” Content marketing is one of the most effective methods for reaching new investors because it provides a real value to consumers. When promoted on the web, content marketing platforms, like nRelate or Outbrain, can help your original content reach even more targeted business readers on influential blogs and news websites.
Find the Best PR Financial Firm
Here are a few questions to help you determine which PR firm is the best fit for your hedge fund.
*Can you give me a publicity strategy for my fund?
*How do you see my fund?
*Tell me about your clients and media placements you have secured?
*Will we be working directly with you? Who is the account executive assigned to us?
*How long before we can expect to see media results?
*What is your media experience?
Develop an Email Marketing Campaign
Email marketing campaigns can be highly controversial because no one likes spam, but when executed in the proper way, they can be highly effective as an investor outreach program. The key to launching a successful email campaign is to deliver original content that educates readers on your fund. Email marketing campaigns are a great opportunity to share research that is exclusive to your fund.
Mark Macias is a former Executive Producer with WNBC and Senior Producer with WCBS. He’s also the author of the communications book, Beat the Press: Your Guide to Managing the Media. Macias now consults small and large businesses on how to get publicity. You can read more on his firm at MaciasPR or MarketYourFund.com