NewAlpha Asset Management: Seeding the future
Antoine Rolland of NewAlpha Asset Management talks about how the firm changed its business model for new clients and picked up a number of innovative partnership deals along the way.
Hedge fund incubation is no longer just a business model but an asset class in its own right, says Antoine Rolland, chief executive of French seeding fund NewAlpha Asset Management.
He believes this business model is increasingly on the radar of institutional investors. Where institutional investors struggle to identify emerging managers and are held back from investing directly due to the size of their mandates, seeding funds such as NewAlpha step in.
Rolland has altered NewAlpha’s strategy to cater to this new interest. Established in 2003, it was originally part of the Paris-based alternatives group ADI. The group had been seeded by French asset management goliaths OFI AM in 1997, but in 2008 the company decided to enter the OFI AM fold fully, bringing NewAlpha with it.
NewAlpha and ADI’s arrival pre-empted a surge of assets at OFI AM, more than doubling from €20bn in 2008 to €47bn in 2009. It was boosted significantly by the addition of Macif Gestion to OFI AM’s stable.
Today, OFI AM has roughly €50bn and 280 employees carrying out an array of activities, from asset management and private equity to infrastructure and real estate funds. Its two main shareholders are French institutions in the insurance industry, Macif (66%) and Matmut (34%). The group’s investors include institutions, corporates and family offices.
To meet the expectations of institutional clients as opposed to individual ones, Rolland recognised the need to adapt. When NewAlpha was originally launched, he says, it operated like a “laboratory”, helping ADI’s closest clients sponsor emerging hedge fund managers. Its approach tended to be more advisory than hands-on business development.