Our focus is capital raising for undercapitalized and emerging hedge fund and private equity managers that have a unique story to tell about their space, strategy or investment protocol. As background for this focus, Mr. Rubin entered the investment management industry from the product side, as one of the first fund managers in the deep value and distressed hedge fund and private equity space. At the time, the space was new to investors and Mr. Rubin’s investment strategy, research protocol and activism were entirely unique amongst his peers. Not unlike any new product, the thrill of being in a discipline with so much runway and so few comparables eventually faded with widespread adoption by all investor types. It’s this dynamic that REMC seeks in its clients’ positioning in their respective spaces.
REMC’s target founding principal is the firm’s portfolio manager. Perhaps similar to Mr. Rubin’s operating thesis for many of his early years in the industry, he likely believes in some combination of (1) the “build it and they will come” thesis of performance marketing and (2) obsessively discussing with investors his strategy in significant detail, as an expression of passion and mastery of his craft. Unfortunately, these matters are either equal or secondary in the eyes of investors (despite their protestations to the contrary) to other frequently unaddressed or underemphasized characteristics.
Further, the manner in which performance and strategy is presented is critical. Attributes that managers believe to be virtues can be misunderstood, underestimated or considered outright negatives. Investors have their own unique methodology of understanding and evaluating opportunities, which in turn demands that managers learn their language, what to emphasize and how to address potential negative attributes.
These lessons were learned by Mr. Rubin over many years of observing certain highly qualified peers underperforming in capital raising while other mediocre firms achieved extraordinarily high AUM’s. There simply appeared to be a limited relationship between performance and assets under management. Perversely, this is precisely the opportunity for clients of REMC. Raising capital is as much a function of structural matters and messaging as it is about top quartile performance. Mr. Rubin’s long-term experience as the founder of a successful investment management firm uniquely positions REMC, relative to other capital raisers, to optimize managers’ positioning with investors and properly align their AUM to the true value proposition they provide.