Promoting utilization of emerging and diverse managers
Verus recognizes the potential of emerging and diverse managers to generate alpha and diversify client portfolios. Manager research and consultants seek to expand opportunities for clients to gain exposure to a larger and more diversified pool of talent that has remained mostly untapped. By integrating this universe of managers into its overall public and private markets manager research, Verus aims to achieve broader outreach and a more inclusionary approach in selecting managers for OCIO portfolios as well as non-discretionary client searches.
Verus integrates research on emerging managers into its regular research process under the leadership of Marianne Feeley, managing director, public markets and Margaret Jadallah, senior consultant. Emerging managers are defined as employee-owned firms with less than $3 billion in total assets under management (“AUM”). Diverse firms are mainly characterized by levels of women and minority ownership, although Verus permits managers to define their own diversity attributes. Private fund managers (private equity, private debt, and real assets) raising their first, second or third institutional vehicles under $1.5 billion are also considered.
Verus has conducted emerging and minority-owned searches across asset classes since the early 1990s and has developed and evolved emerging manager policies as clients’ needs have grown. Our evaluation and recommendation process are identical with a few exceptions. Emerging managers tend to be newer with smaller assets under management and shorter track records. Investment teams and staff size are also often smaller. Verus’ approach is to eliminate the typical hurdles for an emerging manager for these attributes. We are looking for talent in all shapes and sizes.
In addition to our daily research, each year, Verus hosts an event series billed as “Emerging and Diverse Manager Diligence Days”, inviting qualified managers to meet with senior members of the firm. The event is usually held over multiple days, during the month of March, across our offices.