A recent report from research and strategic communications firm Peppercomm argues that the 2012 JOBS Act is having a significant impact on the evolving changes in hedge fund communication practices over the last couple of years.
The Peppercomm report highlights that the growth and maturation of the hedge fund industry over the past few years has also led to significant changes in hedge fund communication practices:
“Once a shadowy, inaccessible and little understood part of the asset management world, hedge funds are growing, diversifying, extending product lines, acquiring competitors, targeting new markets, stepping up client relations – in short, acting more and more like the large, sophisticated businesses they’ve become.
Driving and supporting this business transition is a changing attitude toward and approach to marketing communications. As hedge funds have grown to $2-trillion-plus in assets, they are tackling issues and opportunities like brand, visibility and reputation, all in the face of stiff competition.”
More on the JOBS Act
The Jumpstart Our Businesses (JOBS) Act was passed by Congress back in 2012 and enacted on September 23, 2014. The JOBS Act was designed to spark U.S. economic growth and included a number f different provisions including establishing a legal framework for crowdfunding. The new law also allowed hedge funds to solicit accredited investors for the first time. This means that hedge funds can now engage directly with the media, build public accessible web sites, and can even advertise and use and social media.
New hedge fund communication practices
The Peppercomm report highlights that hedge fund communication practices are evolving to include public web sites, a social media presence, use of traditional media, as well as a new trend toward marketing-related hiring.
The new focus on the public brought about by the JOBS Act has led a number of hedge funds to create or great expand their web presence.
Social media use by hedge funds has skyrocketed over the last two years, with Facebook pages, YouTube videos and live-tweeting now becoming the norm. This week’s Robin Hood Investors Conference is an excellent example, as the presentations of all of the big names in the hedge fund industry are being live-tweeted in real time by journalists and hedge fund marketing teams.
Hedge funds are also becoming more adept at utilizing traditional media. The Peppercomm report notes that mentions of hedge funds in the media are up five-fold over the last 10 years and are at record levels in 2014.
Finally, it seems that marketing is finally getting a seat at the executive table at many hedge funds. The report notes that a growing number of hedge funds of all sizes are hiring communications directors or other marketing-related executives.