RFA was delighted to pick up the award for “Best use of cloud technology” at HFM’s European Hedge Fund Services Awards recently; the latest in a run of award wins which further cements the company’s position in the marketplace.
Managing Director, George Ralph collected the award for RFA and said “It was great to see so many service providers to the hedge fund sector receiving recognition for their efforts at this fantastic ceremony at the Natural History Museum in London. We are always grateful when our services are recognised by our peers in the industry.”
George was also asked to participate in a recent panel discussion at the Bloomberg Hedge Fund Startup Forum, alongside colleagues from KB Associates and Comsura. Over 150 start up hedge funds attended to hear invaluable advice and guidance across all topics. George participated in a panel focused on outsourcing and service provider selection, imperative for emerging managers.
With so many different approaches to outsourcing the panelists discussed the pros and cons of outsourcing different functions at length. IT infrastructure is rarely in-sourced, so many startups are not debating in-house versus outsourcing, but are focused on finding the right partner, to match its needs and expectations. Key considerations for startups are cost, scope, scalability and support. Compliance and security are expected but cannot be guaranteed, so RFA advises firms to evaluate IT partners using a due diligence exercise as stringent as those imposed by investor ODD teams. RFA is frequently asked to complete DDQs for clients on technology and cybersecurity provisions and regulators certainly want to see clear evidence of good data governance and cybersecurity practice.
The panel discussed the most important criteria for selecting third parties, cost, technical capability, credibility, and touched on the importance of a service provider being large enough to service clients effectively, but not so big that the client becomes insignificant and service levels tail off.
It was agreed that negotiating commercial, technical and legal terms at the outset is key; ideally they should match the business’ goals and objectives, with flexibility that can accommodate success or slower growth.
Managing these relationships moving forwards should also be an open book, with room for flex and change to accommodate the changing needs of the firm.
RFA adopts an open and transparent approach with clients, which suits start-up hedge funds. Contracts are flexible and negotiable, there are no binding terms and every element of the service provided is clearly identified and modular. As every start-up is different, so are the services they will require.
Contact RFA to find out more about services for startup hedge funds.