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Emerging Managers Report 2022

Funding stalls in the short term but capital raising poised for a rebound for emerging managers

Just when it looked like emerging managers would get past the effects of 2020, this year brought new market dynamics amid new uncertainties. Our 2022 Buyouts Emerging Manager Survey shows that private capital fundraising has clearly changed across the board.

It was especially challenging for emerging managers, who had a hard time even getting in front of investors. In 2021, thirty-one percent of respondents told us that it took four months or less to get from first introduction to signed commitment. Whereas in 2022, only one in 10 respondents secured commitments in this time frame – more than one half of respondents stating it typically takes five to nine months.

Established firms, on the other hand, are raising increasingly larger funds. These re-ups are absorbing the majority investor interest. LPs report that the percentage of their private equity/venture capital portfolio allocated to emerging managers has been cut by nearly one-third.

New pressures come to light

At the same time, it’s become apparent that today’s more risk-averse environment is putting more pressure on emerging managers to partner with the right service providers. LPs are making a number of unparalleled demands and greater reporting is one of them. In particular, they want real-time access to accurate, timely information.

This administrative burden is a distraction for emerging managers already saddled with market constraints. A partner allows them to focus on the mission-critical tasks of raising, investing, and growing capital without taking on the back- and middle-office responsibilities. Automation, accuracy and transparency have never been more critical.

Implementing technology in private markets should be table stakes now, to handle not only the increasing volume of data but also the growing complexity of the fund structures. Greater competition is also a forcing factor driving next-generation technology to fill a critical role in the fund administration process for emerging managers.

Not only are LPs in the driver’s seat when it comes to capital raising and negotiating terms, but they are also driving trends in fund operations. See what both emerging managers and LPs are prioritizing and how they view today’s private equity landscaping by reading the full report.

Appointments of Nikolaos Perros as COO and Ishita Shah as CCO
Bolster Gen II’s Leadership Team and Prime Firm for Continued Growth

NEW YORK, October 3, 2022 — Gen II Fund Services, LLC (Gen II”), a leading independent private capital fund administrator, today announced the appointment of Nikolaos Perros as Chief Operating Officer and Ishita Shah as Chief Commercial Officer.

Mr. Perros is an experienced business executive with significant expertise in developing and implementing corporate strategy across various business verticals within the alternative asset and financial services industry. Most recently, Mr. Perros served as Head of Private Equity at Citco Fund Services, where he was responsible for establishing and leading Citco’s private capital global service offering. Mr. Perros was also part of the Management Team of Citco Fund Services. Mr. Perros holds a B.S. in Accounting from Fordham University and an MBA from Columbia Business School. As COO, Mr. Perros will oversee all aspects of global client service and M&A integration.

Ms. Shah is a senior finance executive with 20 plus years of experience in alternative assets and fund administration. Prior to joining Gen II, she served as Head of Private Equity, North America at Citco Fund Services, where she led the development of Citco’s private capital platform to become the fastest growing business segment in Citco globally. Ms. Shah was also responsible for the oversight of the private capital platform in Citco’s Asia region. Ms. Shah holds a B.S. in Finance from Hofstra University. As CCO, Ms. Shah will lead the firms commercial strategy through new business development and through the management of long-term relationships with key clients.

“We’re very pleased to welcome these accomplished industry veterans to our world-class team,” said Steven Alecia, President of Gen II. “Together Nikolaos and Ishita bring more than 50 years of experience and expertise in alternative assets, which will help fuel Gen II’s continued growth and innovation.

Were committed to investing in our people, and as we continue our robust growth, the addition of these talented professionals will position Gen II to even more effectively innovate and scale globally,” said Steven Millner, CEO of Gen II. In addition to their notable experience, Nikolaos and Ishita are a perfect fit with Gen IIs focus on operational excellence and were confident their contributions will benefit the firm and our clients.”

I am excited to join an industry leader like Gen II and look forward to working with my talented colleagues to continue to scale and further enhance Gen IIs best-in-class service,” said Mr. Perros.

It is a thrill to join such an innovative firm and Im eager to help expand and optimize the offerings Gen II provides to trusted clients around the world,” said Ms. Shah.

About Gen II

Gen II is a leading fund administration provider focused entirely on serving private capital asset managers and investors. Since its inception in 2009, the company has become one of the largest independent private capital fund administrators, with more than $900 billion of private fund capital under administration. Gen II offers private fund sponsors a best-in-class combination of people, process, and technology, enabling GPs to manage their operational infrastructure, financial reporting, and investor communications most effectively. For more information, please visit www.gen2fund.com.

 

Contact:
Daniel Abramson
BackBay Communications
857-305-8441
daniel.abramson@backbaycommunications.com

Fully Integrated Software Platform Improves Investor Experience, Offers PE Fund Managers
Real-Time Fundraising Visibility, Robust Analytics

NEW YORK, August 17, 2022 — Gen II Fund Services, LLC (“Gen II”), a leading independent private capital fund administrator, today announced the launch of E-Subdocs, a new digital offering that automates the private fund subscription process, significantly improving the investor experience and providing PE Fund managers with real-time information on their fundraising.

Replacing the traditionally time-intensive and error-prone paper-based subscription process, E-Subdocs, which is powered by Anduin, streamlines fund subscriptions from start to finish. At the heart of the E-Subdocs solution is a digital smart subscription form, fully integrated with e-signature, document management, and tracking software. E-Subdocs simplifies the subscription process for investors, saving time and reducing the risk of errors. For PE Fund managers, E-Subdocs provides immediate visibility into investor activity and fundraising analytics. For investors and PE Fund managers alike, E-Subdocs offers critical technology infrastructure, higher levels of trust, and greater transparency, helping to foster a more efficient investor onboarding experience.

“We are pleased to offer E-Subdocs to Gen II clients, further evidencing our commitment to investing in technology solutions that improve the Gen II platform,” said Steven Millner, Gen II’s Chief Executive Officer and Co-Founder. “Given the significant levels of capital invested in the alternative investment space, automation, accuracy and transparency have never been more critical to private market fundraising. We are confident the addition of E-Subdocs to our Gen II platform further enhances and improves the fund subscription experience for both limited partners and PE Fund managers.”

About Gen II
Gen II is a leading fund administration provider focused entirely on serving private capital asset managers and investors. Since its inception in 2009, the company has become one of the largest independent private capital fund administrators, with more than $900 billion of private fund capital under administration. Gen II offers private fund sponsors a best-in-class combination of people, process, and technology, enabling GPs to manage their operational infrastructure, financial reporting, and investor communications most effectively. For more information, please visit www.gen2fund.com.

Contact:
Daniel Abramson
BackBay Communications
857-305-8441
daniel.abramson@backbaycommunications.com

Experienced executive brings deep expertise in leading private credit fund
operations, outsourcing servicing teams

NEW YORK, August 9, 2022 — Gen II Fund Services, LLC (“Gen II”), a leading independent private capital fund administrator, today announced Michael Abatemarco will join the firm as Head of Credit, effective August 9.

Mr. Abatemarco is an experienced credit fund operations manager with significant expertise managing organizations that provide outsourced services to fund managers. At Gen II, he will lead the credit fund administration and credit middle office services business, which provides private credit fund clients with an end-to-end service model.

“With his extensive expertise in credit fund operations, we believe Michael will be a strong addition to the Gen II team,” said Steven Millner, CEO of Gen II. “Bringing Michael to Gen II is in keeping with our commitment to continue serving the ever-expanding private credit market. We are confident that with Michael as Head of Credit, Gen II is well positioned to continue providing our clients with market-leading private credit capabilities.”

Prior to joining Gen II, Mr. Abatemarco served as Director, Head of Bank Loans and Private Placements at BNY Mellon. During his four years at BNY Mellon, he provided management and product expertise and led efforts to improve credit offerings and client adoption. He was previously a Vice President for Goldman Sachs Asset Management, where he provided specialized support for clients with a focus on private and public credit products, trade management, and operational risk management. Mr. Abatemarco holds a B.S. in Accounting and Finance from NYU’s Stern School of Business.

“Gen II is an established leader in private market fund administration and I am thrilled to join the firm and lead their business dedicated to credit fund managers,” said Mr. Abatemarco. “As the credit fund market continues to expand, I look forward to broadening the reach of Gen II’s fund administration solutions and helping fund managers and LPs navigate the operational complexities of this asset class.”

About Gen II
Gen II is a leading fund administration provider focused entirely on serving private capital asset managers and investors. Since its inception in 2009, the company has become one of the largest independent private capital fund administrators, with more than $900 billion of private fund capital under administration. Gen II offers private fund sponsors a best-in-class combination of people, process, and technology, enabling GPs to manage their operational infrastructure, financial reporting, and investor communications most effectively. For more information, please visit www.gen2fund.com.

Contact:
Daniel Abramson
BackBay Communications
857-305-8441
daniel.abramson@backbaycommunications.com

Relocates to Well 22 in Howald

 

LUXEMBOURG, July 26, 2022 — Gen II Luxembourg Services, SARL (“Gen II Lux”), a wholly-owned subsidiary of Gen II Fund Services, LLC (“Gen II”), a leading independent private capital fund administrator, today announced that the firm relocated its Luxembourg office to Well 22, located at 22 Rue des Bruyères.

Located in Howald, close to Luxembourg City, the building is the first in Luxembourg to meet the requirements of the WELL Building Standard® certification process. It is a performance-based system for measuring building features that impact human health and well-being through air, water, nourishment, light, fitness, comfort, and mind. Gen II Lux will occupy approximately 2,800 sqm, nearly three times the size of Gen II Lux’s previous Luxembourg premises. Gen II also has offices in New York, Boston, Dallas, Denver, San Francisco, Stamford, and Vancouver.

“As we continue to grow our operations in Luxembourg and Europe, this innovative and expanded office provides us with an ideal base to build upon,” said Steven Millner, CEO of Gen II. “With flexible modular spaces, green spaces, and easy access to public transportation, this space will foster a high-quality work environment that will improve the well-being, productivity, and health of our staff.”

“We wanted to provide a setting that integrates new standards of comfort and flexibility for our team as we continue to expand our footprint in Luxembourg,” said Norman Leben, CEO of Gen II Luxembourg Services, SARL. “We’re excited to provide our employees with a working environment focused on their health, happiness, productivity and well-being.”

About Gen II

Gen II is a leading fund administration provider focused entirely on serving private capital asset managers and investors. Since its inception in 2009, the company has become one of the largest independent private capital fund administrators, with more than $850 billion of private fund capital under administration worldwide. Gen II offers private fund sponsors a best-in-class combination of people, process, and technology, enabling GPs to manage their operational infrastructure, financial reporting, and investor communications most effectively. For more information, please visit www.gen2fund.com.

 

Contact:
Daniel Abramson
BackBay Communications
857-305-8441
daniel.abramson@backbaycommunications.com

While the new proposed regulations promise an increased burden on fund managers, could there be cause for optimism?

Whenever the SEC proposes sweeping changes to reporting guidelines, private fund managers naturally feel trepidation and concern. In reality, the majority of PE fund managers provide ultra-transparent reporting to their Limited Partners (LPs) and may see the new proposals as unnecessarily punitive.

The initial proposed reforms – presented in February 2022 – generated massive feedback during the requisite comment period. From industry trade groups to fund managers to retail investors, comments included concerns over the frequency and granularity of reporting guidelines and potential prohibitions that would limit investor participation.

As published in an op-ed in Institutional Investor, Managed Funds Association President and CEO, Bryan Corbett, argued that “The SEC is effectively trying to inject itself into the middle of negotiations between sophisticated parties.”

On an operational note, many comments expressed concern about the higher operating costs and added work the new reporting requirements would create for fund managers.

According to Robert Caporale, Gen II’s head of Strategic Business Development, “The proposal is just a starting point, and with feedback and consultation, the hope is that the regulations ultimately land in the right place.”

A Precursor to Significant Asset Growth?

With that said — it’s important to note that every time transparency demands collide within the investment industry, it has been a major precursor to sizable asset growth.

Consider the aftermath of the 2008 financial debacle which was followed quickly by the Bernie Madoff and Allen Stanford fraud revelations.

In response, Congress enacted Dodd-Frank aiming to strengthen regulations and stem systemic risks that were exposed during the credit crisis. As part of Dodd-Frank, every PE advisor with over $150 million in Assets Under Management (AUM) to was required to register with the SEC and to begin reporting using Form PF.

While Dodd-Frank was not popular, no one can deny the sustained trajectory of asset growth that took place over the next 10+ years.

There’s an Ecosystem to be Leveraged

There is an ecosystem available to provide support as things move forward. PE managers will be able to absorb new responsibilities through the support of these various ecosystem participants.

There are fund administration firms that specialize in back office challenges inherent in the new regulations and can streamline performance reporting and disclosures. Lawyers will be well versed in providing guidance on legal obligations, conflict of interest issues, and reporting nuances. And accounting firms will be able to provide specialized audit support and solutions.

Moving Forward

Once passed, there will be a period of frenzied activity while PE Funds and ecosystem participants prepare and position for the future. Once the regulations have been fully absorbed, business will continue in its new iteration.

Private capital is far too compelling as an alternative for funding growth and capturing alpha. Its why retail investors are desperate to participate.

Rather than fearing the new regulations being proposed by the SEC and CFTA, embracing them through the support of fund administration experts would be a solid precursor to the next big move.

Accomplished executive brings significant experience in talent acquisition,
leadership development and organizational impact

NEW YORK, JULY 11, 2022 — Gen II Fund Services, LLC (“Gen II”), a leading independent private capital fund administrator, today announced Anne-Claire Berg will join the firm as Chief People & Impact Officer.

Ms. Berg is an accomplished and innovative HR executive with extensive experience driving holistic transformations connecting business strategy with culture, organization, and people to unlock growth. At Gen II, she will utilize her significant experience in talent acquisition, leadership development and organizational impact to build an engaged, inclusive and high-performing culture. She will oversee human resource operations across all Gen II locations.

“Our greatest asset is the employees of Gen II,” said Steven Millner, CEO of Gen II. “We are confident Anne-Claire’s experience with talent and organizational optimization will prove highly beneficial as she helps further build the structure that will support and grow the leaders of Gen II’s future. We look forward to Anne-Claire building upon what we have in place as we continue to expand.”

Over the past 20 years, Ms. Berg has built and strengthened companies and brands as a business partner, a lawyer and an entrepreneur in a wide range of industries, including the food, media, luxury and financial sectors. Prior to joining Gen II, Ms. Berg served as Global Head of Culture & Engagement at Danone, a leading food company with 100K employees across 60 countries. While at Danone, she unleashed the power of teams in order to develop with the CEO, Executive Committee, and Board an integrated business and ESG strategy, fostering a culture of inclusion, ownership, and sustainable growth. Ms. Berg also served as Secretary-General for Danone UK & Ireland, as a member of the company’s UK Management Committee, and as Global Head of Intellectual Property. She is the co-founder of LUXE.TV, the worldwide leading television network dedicated to luxury and the art of living. She was previously Senior Attorney – Intellectual Property at King & Spalding LLP in New York. Ms. Berg holds an MBA from HEC Business School, a LLM from New York University and a Master of Communication from the French Press Institute.

“Gen II has been through an amazing journey, and I am excited to join as the company embarks on a new chapter to build a world-class leader,” said Ms. Berg. “Outstanding client experiences have their roots in great employee experience, when people are proud and energized by the meaningful impact of their work. I am eager to join forces with Gen II employees to foster a culture of growth, benefiting its customers, its people and its stakeholders.”

About Gen II
Gen II is a leading fund administration provider focused entirely on serving private capital asset managers and investors. Since its inception in 2009, the company has become one of the largest independent private capital fund administrators, with more than $850 billion of private fund capital under administration. Gen II offers private fund sponsors a best-in-class combination of people, process, and technology, enabling GPs to manage their operational infrastructure, financial reporting, and investor communications most effectively. For more information, please visit www.gen2fund.com.

2022 Management Company Report

At a time of great change, turning to a fund administration specialist makes sense

The rapid pace of technological innovation and recent dramatic shifts to business have forced private equity firms to rethink their operations. Funds face greater scrutiny as costs and complexity continue to rise.

When it comes to administration of the management company, the status quo simply won’t cut it anymore.

To help general partners navigate the changing landscape, The Management Company Report was undertaken to provide case studies, analysis, and other critical information.

Included in the report, published by Private Funds CFO in partnership with Gen II, is a breakdown of some of today’s misconceptions about overseeing the management company in-house. A survey shows the importance of benchmarking expense categories. The results can help management companies re-evaluate their strategic thinking during heightened regulatory scrutiny.

Fund administrators can offer critical expertise

Also included is analysis regarding:

  • How the administration of the management company has grown in volume and complexity
  • The many benefits of having highly skilled fund administrators, especially valuable when it comes time to deal with regulators
  • How the right third-party administrator can produce cost savings, greater efficiencies and generally remove headaches for GPs. At the same time, they can also hand them more control over the administrative process
  • The importance of effective collaboration and continuity between fund administrators and those overseeing the management company

Learn more about the importance of finding a good fund administrator in our comprehensive publication: Management Company Report.

Appointments of CEO, President, Chief Administrative Officer, Head of Client Delivery and Innovation
Position Leading Private Capital Fund Administrator for Continued Growth

NEW YORK, June 15, 2022 — Gen II Fund Services, LLC (“Gen II”), a leading independent private capital fund administrator, today announced the appointment of Steven Millner as Chief Executive Officer.

Since co-founding Gen II in 2009, Mr. Millner has served as a Managing Principal and as a member of the Firm’s Executive Committee. Mr. Millner, along with his co-founders, have been leaders in the administration of private capital funds for over 25 years. Their experience extends from assisting with the launch of emerging managers to working with the world’s leading private capital fund managers.

In concert with Mr. Millner’s appointment, Gen II Co-Founder Steven Alecia has been appointed President. He previously served as Chief Client Officer. Co-Founder Norman Leben will step down as Managing Principal. Mr. Leben will remain as a senior advisor to the Firm, a Board Member and continue to guide the Firm’s European expansion.

“I am honored and humbled to assume the role of CEO,” said Mr. Millner. “My sincere gratitude to Norman and Steve and all those at Gen II for making this possible and for our remarkable achievements. This is an exciting time at Gen II and for our industry, and I have never been more enthusiastic about our future.”

“We are very pleased to have Steven assume the role of CEO,” said Mr. Leben. “Steven has played a critical role in Gen II’s growth and is committed to maintaining its operational excellence, developing our offerings, driving innovation and pursuing the Firm’s global growth strategy.”

“We are looking forward to having Steven at the helm, and I’m very confident in his ability to lead the stellar team at Gen II and drive not only our Firm’s success, but also the success of our clients,” said Mr. Alecia.

In addition to Mr. Millner’s appointment, Michael Pollack has joined the Firm as Head of Client Delivery and Innovation and Matthew Luongo has joined as Chief Administrative Officer. Most recently, Mr. Pollack served as Founder and CEO of Pollack Consulting Group, an independent management consultancy focused on strategy, operational, and technology solutions. Previously, he served as Managing Director and Global Head of the Portfolio Analysis Group at J.P. Morgan and as Managing Director and Divisional CFO of Markets Operations Technology at Citigroup. Mr. Pollack holds a B.A. in Computer Science from Princeton University and an MBA from the Stanford Graduate School of Business.

Mr. Luongo has joined Gen II as Chief Administrative Officer. Prior to joining Gen II, Mr. Luongo founded MJ Management Solutions, a business management consulting firm. He previously held executive level roles at CLS Bank, Cognizant Technology Solutions, UBS and American Express, providing strategic and operational expertise to optimize organizational effectiveness, efficiency, and employee experience. Mr. Luongo holds a B.S. in Business Administration from the University of Nebraska-Lincoln and an MBA from Pace University.

“With Michael and Matt’s deep expertise in financial services and operations, we’re confident that they will make an immediate impact at Gen II, further enhancing our efficiency and strengthening the world-class service that is the hallmark of Gen II,” said Mr. Millner.

About Gen II
Gen II is a leading fund administration provider focused entirely on serving private capital asset managers and investors. Since its inception in 2009, the company has become one of the largest independent private capital fund administrators, with more than $850 billion of private fund capital under administration. Gen II offers private fund sponsors a best-in-class combination of people, process, and technology, enabling GPs to manage their operational infrastructure, financial reporting, and investor communications most effectively. For more information, please visit www.gen2fund.com.

Contact:
Daniel Abramson
BackBay Communications
857-305-8441
daniel.abramson@backbaycommunications.com

Partnership bolsters firm’s global cloud and security platform;
Exemplifies commitment to best-in-class operations

NEW YORK, June 9, 2022 — Gen II Fund Services, LLC (“Gen II”), a leading independent fund administrator in the alternative investment space, today announced it has chosen NTT Ltd., a leading global technology services provider, as its managed cloud services provider to accelerate its digital transformation journey.

Gen II Fund Services leveraged NTT’s advisory and digital services experts to modernize and manage its IT infrastructure to improve operational efficiencies and enhance its customer service.

The new multi-year agreement will consolidate Gen II’s cloud support and security desks into a powerful platform leveraging NTT’s global scale and industry-leading hybrid cloud capabilities, providing the firm and its clients with enhanced efficiency, security, and scalability in a singular global solution.

The partnership will create a service desk available 24/7/365 to all Gen II staff globally across time zones. Strategically located onshore in the U.S., the service desk will further improve the consistency and coverage of Gen II’s world-class client service.

“We are pleased to partner with NTT as we continue to further enhance our technology infrastructure and provide our clients with innovative technology solutions,” said Steven Millner, Managing Principal and Co-Founder, Gen II. “Gen II was an early adopter of cloud infrastructure and digital solutions and through our partnership with NTT, we continue to invest in a scalable global platform for future growth.”

“By bringing NTT’s expertise in cloud services and security to Gen II Funds, we have designed and will manage an innovative cloud infrastructure that will enable Gen II to deliver superior customer service, while improving operational efficiencies,” said Tyler Affolter, Senior Vice President, Managed Services, NTT Ltd.

About Gen II
Gen II is a leading fund administration provider focused entirely on serving the alternative asset management space, including private equity, real estate, and credit funds. Since its inception in 2009, the company has been one of the largest independent private equity fund administrators, with more than $700 billion of private fund capital under administration. Gen II offers private fund sponsors a best-in-class combination of people, process, and technology, enabling GPs to manage their operational infrastructure, financial reporting, and investor communications most effectively. For more information, please visit www.gen2fund.com.

About NTT
NTT Ltd. is a leading, global technology services company. To help our clients achieve their digital transformation goals, we use our global capabilities, expertise, and full-stack technology services delivered through our integrated services platform. As their long-term strategic partner, we help them enhance customer and employee experience, transform their cloud strategy, modernize their networks and strengthen their cybersecurity. And across their transformation priorities, we automate their business processes and IT, drawing insights and analytics from their core business data. As a global ICT provider, we employ more than 50,000 people across 57 countries, trading in 73 countries and delivering services in over 200 countries and regions. Together we enable the connected future.
Visit us at services.global.ntt

Contact:

Daniel Abramson
BackBay Communications
857-305-8441
daniel.abramson@backbaycommunications.com