2019 brings a world of opportunities to iM Global Partners, a multi-boutique platform with offices in Paris, London and Philadelphia. That is what José Castellano, Deputy CEO, and Head of International Business Development is tasked with.
In an interview with Funds Society, Castellano, who joined the firm earlier this year, mentions that considering there is a worldwide strong appetite for alpha products from the best asset management companies, they are currently developing a global distribution platform.
In his opinion, “pension systems around the world are looking at specialized active managers while keeping the passive side invested with large asset managers.” And he believes their partners “have the quality to get strong appetite for alpha from investors”, so he is trying to take them to global portfolios while also looking to add on more partners. “We have clients almost everywhere not because we are active on the business perspective but because our partners are so good they have been already identified.”
iM Global Partners currently has strategic minority investments in four management companies – Polen Capital, Dolan McEniry Capital Management, Sirios Capital Management and Dynamic Beta investments but they have a big pipeline and ambitions.
“One of the reasons I got involved with the company, besides of how I see the industry, with big opportunities for alpha managers in the world, and that I also like that it is very entrepreneurial, flexible, effective, but also, because we have a huge level of ambition to grow the platform tremendously. I can tell you our intention is to invest in the next years up to 500 million, we have already deployed around 125 million so [we are looking to partner with] somewhere between 10-20 different asset managers with between 1-20 billion in AUM.”
Castellano mentions they have a very long pipeline and a number of ongoing conversations. Currently they are looking to close 1-3 transactions a year, and that they “are looking at liquid alternatives, US equities, European equities, Emerging Market Debt and US credit, as the asset classes where we are putting a lot of effort.”
Why partner with iM Global Partners?
According to the industry veteran, iM Global Partners is especially attractive to asset managers given that they have entrepreneurial DNA: “We are very flexible, we can talk to them every day, and we only buy minority stakes, between 20-49%. We do not want to manage the company, but we want to be very active on the business side. In that case we are very flexible and tackle it on a case by case base. We also offer permanent capital.” Castellano believes asset management is a long term game and so is its relationship with their partners. They provide a distribution platform but there is a full alignment of interests, since they are not only distributions but partners.
What are they looking for?
“When we buy stake in the AM we make sure we can accelerate their growth exponentially. For example if we buy someone with 3 Billion AUM is because we know they have the potential to go to 6, 10, 20 billion in AUM. Our idea is to help them grow exponentially by exposing them to other areas of the world.” Castellano mentions adding that their main consideration when building the pipeline is finding the right people, right talent and outstanding performance over time. “They have to be excellent in the long run but more with a difficult market because we believe that the best managers shine when they have a difficult market.”
Their mayor focus in the first half of 2019 is to launch Europe and expose their partners to the European market. They are having events in February in Paris, Zurich, Milan, Madrid, Lisbon and the UK.
For the second part of the year they are looking at Asia-Pacific since they are engaged with some Australian partners, and Latin America.