Once an investment opportunity is identified, Estancia will conduct a preliminary review of the opportunity to determine if there is sufficient interest to pursue a more formal due diligence process.
Review the target’s in eVestment Alliance (or other similar database) in detail, including:
- Length of track record
- Absolute performance
- Relative performance to peer universe and benchmark
- Tracking Error
- Sharp Ratio
- Up/Down Capture Ratio
- Style drift and performance pattern analysis
- Asset growth by product and channel type
- Client concentration
INITIAL MANAGEMENT CONTACT
Hold preliminary calls or meetings with member(s) of target management to qualify opportunity and determine:
- Validity of catalyst assumption
- Objective(s) of key professionals
- Recent firm operating results/financial performance
- Current equity ownership
- Objective(s) of non-management equity owners
- Investment product capacity and desire to grow business
MEET WITH MANAGEMENT TEAM
Schedule onsite meeting(s) with entire management team for purposes of assessing overall strength of opportunity i.e. caliber and depth of investment team, firm culture, objectives and inter-relationships.
PREPARE INVESTMENT OPPORTUNITY SUMMARY
Prepare short summary or outline of view on investment opportunity and determine if further investigation through a more formalized diligence process is desired.