The experience of investors during the life of their investment in an alternative fund goes a long way to persuading them to invest in the same sponsor’s products in the future. The investor relations team must be equipped and inclined to serve investor needs and exceed expectations. The availability, reliability and responsiveness of investor relations leaves an impression. There are twelve aspects of the investor’s interaction with investor services with the potential to make a difference in deciding to reinvest.
1. New Investment
An investor may subscribe to an alternative investment fund via traditional paper subscription documents, electronically through a straight-through processing provider used by the financial advisor, through the Alternative Investment Products (AIP) platform or by filling out a form on the fund sponsor’s website. Whichever means is utilized, the ease and efficiency of the process, the investor’s first experience of the level of investor relations efficiency, will be noticed.
Upon completion of admittance to the fund, the investor will receive a confirmation by mail from investor relations confirming that all is in order.
3. Web Portal Set Up
The investor will have to be set up for access to the investor web portal for the fund so that essential information can be accessed 24/7. Investor relations will mail a temporary user name and password, in two separate mailings to ensure security security.
4. Questions, Requests and Notifications
The investor web portal provides two-way communication between the investor and the investor relations team. Any investor questions, requests or preference changes can be submitted via the web portal. Any updates, notifications or announcements can be made by management via the web portal to keep investors informed.
5. Capital Calls
Investor relations provides multiple means of communicating with investors for capital calls. Email, mail, phone and the investor web portal may all be employed to make sure investors are notified and clear instructions for submitting funds are communicated.
6. Profile Changes
Any change of investor name, mailing address, email or change of preferences with regard to payments or any investor relations deliverables can be submitted via the web portal. Changes requested by email, mail or phone will require additional indentiy verification by investor relations.
7. Proxy Voting
Any required participation of investors in proxies is communicated as needed by investor relations via mail, email and/or the investor web portal. Investor relations may conduct follow-up outreach by phone to ensure the required investor participation. Investors may vote via any one of these lines of communication.
8. Positions, History and Documents
Investor relations will provide any and all information fund management shares with investors via the investor web portal: position information, transaction history, balances, status updates, statements, tax documents and needed forms.
Investor relations may feature performance, updates and highlights of current portfolio assets on the web portal. The investor web portal is also often leveraged as a means of marketing current and future offerings.
Payments to investors may be executed by way of printed check, ACH or wire transfer according to investor preferences. Investor relations may notify investors of upcoming distribution payments by email or the investor web portal or both.
Through the life of the investment, investors will receive statements reporting their investment status according to their preference, by mail email or investor web portal. The clarity, readability and professional appearance of investor statements says a lot about a fund sponsor’s investment brand and its commitment to investor relations.
12. Tax Documents
Every year, investor relations will deliver the requried investor tax documents, either form 1099 or K-1. The main concern with regart to tax documents is that they be prompt. No investor wants to delay extend their time to file their tax return because one of their portfolio funds failed to deliver a 1099 or K-1 in time. Investor relations has a real opportunity to impress with the reliably early delivery of investor tax forms.
The return on investment a fund sponsor delivers for investors is the main mission. However, the way investor relations manages the investment experience has the potential to foster the sponsor’s overall image of professionalism and care that will keep them coming back. Serious consideration and meaningful investment in a superior investor relations solution pays dividends throughout the life of the fund.