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Ron Biscardi B. G., Opalesque Geneva: Ron Biscardi, the CEO and co-founder of iConnections, has been building capital-raising platforms for hedge funds for nearly 10 years. In his view, the biggest changes in the capital introduction industry are the adoption of technology and growing involvement among private market participants. He also observes interesting trends in the way allocators and managers meet, and that there is a right way to use a networking platform, and a wrong way.
Ron Biscardi has over 25 years of experience in the alternative investment industry. He built the world's largest alternative investments capital introduction conference, Global Alts, which takes place annually in Miami Beach, and his iConnections platform is used by key industry participants such as AIMA, 100 Women in Finance, SALT, as well as CNBC's 'Delivering Alpha' and Forbes' Iconoclast events.
Private market funds
"Cap intro has been broadly used by hedge funds for years, mostly driven by all the big prime brokers," says Biscardi. "But on the private market side, there isn't a natural sponsor of cap intro type events because there is no prime broker involved. The service provider community within private markets just isn't set up in the same way. iConnections is filling in that void."
Private market funds typically invest in private equity, venture, private debt, infrastructure and real estate.
Since Biscardi founded iConnections in April 2020, the firm has partnered with many private market funds, to the extent that approximately 40% of the Global Alts conference is geared towards them. "Whereas, when I started in the cap intro market in 2013, it was 100% hedge funds," he adds.
The way we meet
Another notable change in capital raising over the last decade is the way people meet. Platforms like iConnections are now enabling managers and allocators to message, exchange documentation, and meet virtually on the platform. It is a sharp contrast to 2013 when everything was done physically. The iConnections cap intro platform has become so practical that members run it on their smartphones. "We're providing much more of a connection among a broad community of investors, alternative fund managers and service providers," he says. "As a result, our ability to build that community and keep it connected is vastly better than it was ten years ago. We have ongoing interactions between allocators and managers on our platform and app throughout the year, through our Coffee Chats and Pitch Sessions."
Before the current platform model came to be, people at events who cancelled a physical meeting would lose that meeting. This is different now, as physical meetings can be replaced by virtual meetings after the event has ended. The technology also allows people to find each other at events and host break-out sessions.
The pandemic shifted the focus of initial meetings. Now, a lot of people prefer the introductory meeting to be virtual, something platforms such as iConnections can facilitate. Post-pandemic, the platform continues to help coordinate virtual and physical meetings in and out of events.
People met in person and went to events a lot more after the pandemic subsided as a reaction to being locked indoors for so long. But now, the trend is swinging back to virtual meetings, at least for the initial ones.
"Of course, everyone still prefers to meet face-to-face, especially in this industry," he says. "Generally speaking, you're not going to allocate tens of millions of dollars without a face-to-face meeting and going through the typical due diligence process. But it doesn't have to start there. Coming out of COVID, there's no question that the entire industry is definitely more comfortable with this technology as their first step."
There is also the issue of carbon footprint programs among GPs and LPs. The app and technology facilitate the initial meetings, as well as the ongoing connectivity, reducing the need to travel around the world at least for the initial meetings.
Breaking into Asia
Last month, iConnections ran an inaugural event in Singapore in collaboration with SALT. This proved to be especially successful because the culture in Asia is very focused on face-to-face meetings, says Biscardi. There were 800 attendees and more than 1,000 one-on-one meetings.
"We were very excited to partner with SALT, who had already been to Singapore previously and ran a couple of really good events there."
He believes the event could acquire the same status as the flagship Global Alts event in Miami, where this year they expect 3,000 attendees and 12,000 meetings.
One reason for Biscardi's confidence is the presence of a high number of HNW individuals and family offices in Asia. A second factor is the level of interest from European and US fund managers looking to access Asia to raise capital. Singapore, he adds, is becoming the financial hub of Asia, with families moving there in droves. There will be another event there in 2023.
How to get that meeting
According to Biscardi, managers who get the greatest number of meetings are the ones who complete their profile on the platform. "There's a very high correlation between the funds who don't put any information in the system and those who have a low meeting counts. If you don't want to put your information in there, the allocators don't have anything to go on."
When it comes to getting meetings confirmed, allocators take their time. It is up to the fund manager to pursue those allocators and apply a proactive mindset.
"In the lead up to this event, you really want to stay on top of those requests. We give every fund manager one hundred meeting requests and if someone declines that meeting request, it gets credited back to them which can then be used with a new allocator... You really want to be in the system every day, keeping a close eye on how those meeting requests are progressing." Another thing managers should do is update their performance, he adds.
As for allocators, iConnections opens the system first for them, so that they can look around and book meetings before "being inundated with requests".
One thing allocators should really do, Biscardi notes, is to state their investment preferences on the platform. That will reduce the number of requests from managers that are not suitable.
Do your work early
"The other thing I'll say for both sides is, do your work early," he adds. "Historically, about 40% of the meetings end up getting booked in the last 10 days leading up to the event. It would be great to see managers and allocators doing this work earlier in the process and not waiting until the last minute. What ends up happening is that schedules get full and then people have a harder time scheduling the meetings."
iConnections runs an algorithm that schedules the meetings. People who want to set up a meeting can simply tell the system their availability and whom they want to meet. The algo schedules all confirmed meetings a week before the event. The benefit of this system does not apply for those who wait until the last minute.
"I would encourage everyone to just try and do their work early. The beauty of it is once you're done you have your calendar set, you show up in Miami and you're off to the races. You know exactly where you're going to be for each half-hour slot throughout those two days during which all of the cap intro meetings take place."
Global Alts 2023 will take place in January. Opalesque's founder Matthias Knab will attend the conference.
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