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Jensen Partners’ Q1 Newsletter: Powering the Distribution Diversity Movement
Growing pressure for diverse hires fuels a sea-change in the alternative investment industry
|Diversity, Equity, and Inclusion (DEI) has been at the heart of every recruitment campaign Jensen Partners has executed over the last year -- every pitch, every client meeting and every candidate search.|
Yet, I hear the same question everywhere I go: "Is the increased attention on diversity, equity and inclusion (DEI) just a moment or part of a real movement?"
I'm here to report that DEI as a core focus in the alternative investment industry is 100% a surefire movement.
It is hard to overstate just how much has changed in the last two or three years regarding DEI. Before 2020, many alternatives firms talked a big game about improving diversity, but few did anything meaningful to change their hiring or recruiting practices; the industry had some of the worst diversity numbers of any sector in the economy. Fast forward to today and it is clear DEI has become an imperative for firms seeking to be competitive, whether in the market for talent or the market for institutional capital.
I've lost count of how many client requests I've received from firms to conduct searches for women-only or diverse-only candidates. Many of these searches are concentrated at the senior level, with the idea that marketing heads could build out their teams with diverse talent at every level. This has proven to be a more effective strategy for increasing organizational diversity than mentorship or recruitment programs, which can often take a long time to bear fruit. Slowly but steadily, diversity numbers are ticking up across the alternative investment industry.
We see several drivers of this DEI movement:
1. Institutional investors (or LPs) increasingly expect their GPs to have diverse teams with front office representation and will withhold allocations from firms with poor diversity numbers. Some LPs specifically target diverse-owned alternative asset managers.
2. GPs recognize the importance of having a diverse workforce to build a more robust culture and improve investment performance. A recent study by Institutional Allocators for Diversity Equity and Inclusion (IADEI), a consortium of over 500 asset owners seeking to drive diversity, equity, and inclusion in asset management, found evidence to suggest that DEI has the potential to improve performance and reduce risk in private equity portfolios.
3. The best talent is voting with their feet by leaving organizations too slow to take DEI seriously or refusing to interview prospective employers with a poor track on diversity.
To be sure, there is still a long way to go. Diverse-owned firms manage only 1.4% of the $82.2 trillion US asset management industry. Our data shows that barely half (52.4%) of all marketing moves in the quarter qualified as diverse. But this still represents 531 new hires (439 female candidates and 92 male BIPOC candidates), turning what used to be a trickle into a flood of new diverse talent.
All these signs point to an inflection point in the history of the alternative investment industry and potentially in the history of the US. I remember reading dozens of celebratory LinkedIn posts from my contacts across the industry when Ketanji Brown Jackson was confirmed to the US Supreme Court, a historical moment that seemed to bring together people of all backgrounds.
For me, this diversity movement brings up memories of my days at university when I was studying Immanuel Kant and the idea of a "moral imperative," or something in a person's mind that compels them to act. It's clear that the murder of George Floyd and the subsequent protests against racial injustice changed how people think about diversity and compelled those in a position of power to take action.
For Jensen Partners, this meant launching Jensen DiversityMetrics™ as a data visualization tool to help alts firms understand how they compare to their peers in terms of the diversity of their workforce. It's also why we pledged in late 2021 that all future human capital searches would begin with a candidate pool comprised of at least 51% of candidates who come from underrepresented backgrounds. The Jensen DiversityMetrics Pipeline Tracker™ flows from thousands of interviews with self-identified diverse candidates who would be considered at an "inflection point" because their current firm has not addressed or implemented DEI strategies as part of their core business model.
Other firms in the alts space have made similar commitments, from Bridgewater Associates creating a fellowship program to generate a pipeline of diverse financial talent to the Carlyle Group tying employee compensation to achieve DEI goals. The CFA Institute has even introduced a voluntary DEI code encouraging investment professionals to commit to six principles covering everything from talent acquisition to promotion and retention. We've counted over 800 similar DEI initiatives across the industry.These are all necessary and positive steps, each one fueling the diversity movement and pushing the alternative investment industry in a positive direction.
In addition to marking an inflection point on DEI, the first quarter of 2022 was also a blockbuster quarter for hiring capital formation, fundraising, and product specialists. We tracked over 1000 moves and 400 promotions in the first quarter, as well as these trends:
1. Record number of moves in the market and a record of moves from underrepresented groups.
2. The most significant increase in monitored groups is Latinx, female and then black.
3. Black distribution professionals are being promoted from junior to senior positions – these stats have increased 100 percent from Q4 2021.
4. The hiring of black professionals decreased across the industry. However, the decrease correlates with increased retention due to promotions, and thus there were fewer moves from firm to firm.
All in all, I am pleased to announce that we are beginning to track a sea change in overall gender and ethnic promotion and hiring. If we keep this momentum up, we will have even more exciting data to report at the end of 2022.
If you would like exact information on these diversity hires and distribution moves, please email me at email@example.com.
Sincerely, Sasha Jensen
|Q1 Data Highlights|
|Here are a few of the most interesting data points from Q1 2022:|
|❖ We tracked 1,013 moves in Q1 2022, a 68.83% increase from Q4 2021 and 35.97% from the 745 moves in Q1 2021. This is the ninth straight quarter that hiring activity has surpassed 400 moves and the first quarter where it exceeded 1000 moves.|
❖ The biggest movers and shakers for Q1 included: Private Equity firms (241 moves), Multi-Asset firms (214 moves), Credit (168 moves), and Hedge Funds (138 moves). These are also the four sectors that generated the most hiring activity in Q4 2021 as well: Private Equity firms (145 moves), Multi-Asset firms (134 moves), Credit (83 moves), and Hedge Funds (71 moves).
❖ Unlike in Q4 2021, we observe that majority of the firms saw an increase in hires in Q1 2022 when compared to Q4: Private Equity, which had 241 moves (or +96 moves from Q4, a 66.21% increase), followed by Credit with 168 moves (or +85 moves from Q4, a 102.41% increase), Multi-Asset 214 moves (+80 moves, a 59.70% increase), Hedge Funds 138 moves (+67 moves, a 94.37% increase), Wealth Management 60 moves (+37 moves, a 160.87% increase), Real Estate 47 moves (+27 moves, a 135.00% increase), Secondaries 38 moves (+15 moves, 65.22% increase), and Infrastructure 20 moves (+5 moves, a 33.33% increase). Only Private Fund Group, which had 75 moves, experienced a decline (-4 moves, or a 5.06% decrease). Of the two more niche sectors, Fund of Funds had not experienced a change in hiring since Q4, whereas FinTech/Venture Capital experienced an increase of 4 new hires, compared to no hires in Q4 2021.
❖ When compared to Q1 2021, the majority of the sectors experienced a boon in hiring according to our data Credit is leading the way with a 273.33% increase (or +123 moves from Q1 2021), followed by Infrastructure +122.22% (or +11 moves), Real Estate +62.07% (or +18 moves), Private fund Group +50.00% (or +25 moves), Wealth Management +27.66% (or +13 moves), Private Equity +24.23% (or +47 moves), Hedge Fund +18.97% (or +22 moves), and Multi-Asset +15.05% (or +28 moves). According to our data, Fund of Funds is the only sector that witnessed a slump compared to Q1 2021, experiencing a 100.00% decrease (or -14 moves).
❖ As with previous quarters, we also track hiring activity in the more niche sectors of the alternative investment space (see 'New Categories' table). In this category, the number of hires increased for FinTech/Venture Capital by 300.00% (or +3 moves) and Secondaries by +11.76% (or +4 moves).
❖ Compared to Q1 2021, we observe an improvement in marketing hires across all the regions. Specifically, in the first quarter of 2022, NORAM had 630 moves (+193 moves, a 44.16% increase), the UK had 184 moves (+22 moves, a 13.58% increase), and the rest of Europe had 114 moves (+42 moves, a 58.33% increase), APAC had 79 moves (or +12 moves, a 17.91% increase), and MENA had six moves (+2 moves, or +50.00% increase).
|Data on Diversity|
|With diversity continuing to be a top-of-mind issue for alternative investment firms, we take a deep dive using Jensen Partners’ newly launched Jensen DiversityMetrics™ data visualization technology to see how well the alternative investment industry is improving diversity among the ranks of marketers.|
|❖ In Q1 2022, we tracked 531 diverse moves (439 female candidates and 92 male BIPOC candidates), representing 52.42% of all marketing moves in the quarter, an 8.08% increase from Q4 2021 and 1.17% increase from Q1 2021 for which we tracked 386 diverse moves (303 female candidates + 83 male BIPOC candidates) representing 51.81% of all marketing moves in the quarter. |
❖ From a gender perspective, female moves in Q1 represent 43.34% of all hires, up from 35.17% we recorded for Q4 2021 and 40.67% for Q1 2021. We also observed that, unlike in Q4 2021, both female and male moves increased in Q1 2022. When compared to male moves, female moves increased by 108.06% from Q4 2021, whereas male moves increased by 47.56% from Q4 2021. Similarly, when compared to Q1 2021, we observe that female moves increased by 44.88%; whereas male moves increased by only 29.86%.
❖ In terms of racial ethnicity, we continue to see Caucasians make up the vast bulk of all marketing moves – 80.00% in Q1 2022, representing a 3.17% increase from 77.50% in Q4 2021, and a 2.18% increase from 78.26% in Q1 2021. Unlike in Q4 2021, where we observed a slump in marketing hire activities across all ethnicities, except for Hispanic hires, in Q1 2022 we note that marketing moves increased across all ethnicities. Similarly, compared to Q1 2021, we note that marketing moves increased across all ethnicities except for South Asian hires. Hispanic moves experienced the highest increase when compared to Q1 2021 by 314.29% (or 29 moves, +22 from Q1 2021). The increase in Hispanic hires is followed by East Asian hires with 85 moves (or +24 moves, a +39.34% increase), Caucasian – 810 moves (or +227 moves, +38.94%), Middle Eastern – 19 moves (or +3 moves, +18.75%), and Black – 25 moves (or +2 moves, +8.70%). Unlike the other ethnicities, South Asian hires experienced a slump of 16.67% (or 25 moves, -5 from Q1 2021).
❖ Last year, we noted that the number of Black marketing professionals hired as a percentage of all hires decreased by about 12% from the pre-protest period (Q4 2019-Q2 2020) to the post-protest period (Q3 2020-Q1 2021), with Black professionals remaining a minority across the alternative investment industry with just 3.1% of all hires in Q1 2021. In 2021, we observed a continuation of this negative trend with Black professionals representing only 3.10% of all hires. Similarly, in Q1 2022, we observe that the number of Black marketing professionals hired as a percentage of all hires did not improve, representing only 2.47%, a 20.06% decrease from Q1 2021 and a 17.71% decrease from Q4 2021.
|Jensen Partners' New Product Offering: DEI Market Mapping|
|We work directly with senior investment professionals and senior marketers to identify, attract, and hire the industry’s most accomplished diverse professionals. Over the last decade, we have built a dataset that includes verified demographic data for more than 25,000 investment and distribution professionals from across the industry, including 8,000 who self-identify as having a diverse background across more than 100,000 positions. We harness that data to support the build-out of diverse investment and marketing teams.|
New Jensen DiversityMetrics™ Mandate
HIRING: $12B Global Infrastructure Fund
MANDATE: DIVERSITY MARKET MAPPING via Jensen DiversityMetrics™
EXECUTION: Market map every self-identified diversity candidate from Associate to Managing Director across infrastructure investments to create a long-term pipeline for diverse candidates to interview and hire.
LOCATION: All continents
DESCRIPTION: Our client is one of the leading Global Digital Infrastructure Funds and is looking to add multitudinous hires across investments spanning North America, London and Asia. The successful candidates will be infrastructure investment specialists with relevant sector experience across digital / telecommunication infrastructure or related investment channels. They will have hands-on investment origination and deal experience to work with an established global team of over 200 people. Diversity initiatives are a key priority for this progressive and highly innovative infrastructure fund.
|See below for a partial selection of current mandates. Contact us at firstname.lastname@example.org to learn more about each search.|
|HIRING: $12B AUM Global Infrastructure Fund|
ROLE: Vice President / Director, DCM Infrastructure Investment specialist
DESCRIPTION: Our client is one of the leading Global Digital Infrastructure Funds and is looking to add a Debt Capital Markets Investment specialist. The successful candidate will build out the firm’s DCM and Infrastructure Debt business. They will likely be working for a leading Investment Bank, have hands-on DCM deal experience and ideally possess a deep sector knowledge across TMT and Digital Infrastructure channels. They will work closely with the head of DCM and more broadly, with an established global team of over 200 people. Diversity initiatives are a key priority for this progressive and highly innovative infrastructure fund.
HIRING: $12B Real Assets Firm
ROLE: Head of Capital Raising – North America
LOCATION: New York
DESCRIPTION: Our client is a leading Global Infrastructure Fund with a 25+ year Investment track record. They have recently expanded their presence in North America and are building out significantly over the next 12 months. The successful candidate will run the distribution strategy and all fundraising initiatives throughout North America and Canada. They will be a self-starter and have an extensive and proven track record in fundraising, relationship management and institutional sales, preferably from an infrastructure, renewable, or private equity background.
HIRING: $80B AUM Private Credit Fund
ROLE: Senior East Coast Relationship Manager
DESCRIPTION: Our client is a leading private credit firm looking to add a Senior Relationship Manager to its broader credit platform to focus on East Coast Institutional investors. The successful candidate will have deep relationships across the institutional spectrum, specifically selling private credit products.
HIRING: $80B AUM Private Credit Fund
ROLE: Senior West Coast Relationship Manager
DESCRIPTION: Our client is a leading private credit firm looking to add a Senior Relationship Manager to its more comprehensive credit platform to focus on West Coast Institutional investors. The successful candidate will have deep relationships across the institutional spectrum, specifically selling private credit products.
HIRING: Alternative Investment Advisory Firm
ROLE: Mid-to-Senior Level Secondary Advisory
DESCRIPTION: Our client is a whole life cycle global alternative investment advisory firm looking to add a Mid-to-Senior individual to their Secondary Advisory team. The successful candidate will have extensive transaction experience in the secondary market, specifically GP-led transaction experience.
HIRING: $2.5B AUM Global Investment Firm
ROLE: Mid-to-Senior Level Real Estate Fundraising & Investor Relations
DESCRIPTION: Our client is a global investment firm looking to add a Mid-to-Senior individual to their team to focus on Fundraising & Investor Relations on their Real Estate platform. The successful candidate will have deep relationships across the institutional spectrum and experience marketing Real Estate funds.
HIRING: $47B AUM Global Credit Manager
ROLE: Mid-to-Senior Level Real Estate Fundraising & Investor Relations
DESCRIPTION: Our client is a global credit manager looking to add a Senior Fundraiser to their team to focus on building the firm’s investor base in the Middle East. The successful candidate will have deep relationships across the region and work closely with the Head of Business Development and Strategy and the broader Business Development team to grow their footprint with clients in the Middle East. The role would include expanding existing relationships and establishing new regional partnerships.
|In Q1 2021, we introduced the 'DEI Corner' where we spotlight diverse professionals who have been promoted at their existing firm or joined a new firm in the alternative investment space. At Jensen Partners, we believe representation is power and will continue to highlight these moves to serve as an inspiration and an example of what accurate representation could look like in this industry. If you would like to view the list of this quarter's diverse hires and additional distribution moves, please email me at email@example.com.|
|Here is a curated selection of recent marketing moves across the following strategies: Credit, Fund of Funds, Hedge Funds, Infrastructure, Multi-Asset, Private Fund Groups, Private Equity, Real Estate, Secondaries, and Wealth Management.|
❖ Cecilia Chiang joined Apollo Global Management in January 2022 as a Managing Director, Credit Products on the Client and Product Solutions team in New York. Before Apollo, she was at Columbus Hill Capital Management as a Managing Director and Head of Investor Relations.
❖ Joe Reid joined Vector Capital as Managing Director and Head of Marketing & Investor Relations, Credit in April 2022. Previously, he was a Managing Director for three years, covering Marketing and Investor Relations at Monroe Capital. He is based in Los Angeles.
❖ Donald Salvino joined One William Street Capital Management in February 2022 as a Managing Director and Head of Intermediary Distribution. He joined from Alcentra, where he was a Managing Director and Head of Retail Products. He is based in New York.
❖ Audrey Wang joined Marathon Asset Management in March 2022 as a Managing Director and Head of West Coast Consultant Relations. She relocated from New York to Los Angeles for this new role. She joined from Mackay Shields, where she was a Managing Director and Global Head of Consultant Relations for the last six years.
|INFRASTRUCTURE, REAL ASSETS & REAL ESTATE|
❖ Sydney McConaty joined BlackRock as a Managing Director, Investor Relations and Product Strategy on the firm's Global Energy & Power Infrastructure Group in January 2022. She was most recently Head of Business Development and a Senior Managing Director with Hancock Natural Resource Group for five years.
❖ Hideki Suruga joined First Sentier Investments in May 2022 as Head of Distribution for Japan. He joined from Mistubishi U.F.J. Kokusai Asset Management, where he was Managing Executive Officer and Head of Products.
❖ Doug Meyer joined The Rohatyn Group in February 2022 as Head of Business Development. He was most recently Global Head of Business Development with First Eagle Investment Management. He is based in New York.
❖ Albert Ming joined State Street in February 2022 as a Managing Director and Head of APAC Relationship Management for the Alternatives Client Segment. He joined from VISTRA, where he was Head of Alternative Assets, North Asia, for two and a half years. He is based in Hong Kong.
❖ Kevin Morro joined Riverside Partners in January 2022 as Head of Business Development in Miami. He joined from H.I.G. Capital, where he was Head of Business Development for Middle Market and Advantage Funds.
❖ Vesna Sipp joined MidEuropa Partners in February 2022 as a Partner and Head of Investor Relations in London. She was previously at Intermediate Capital Group, where she was most recently Head of Client Relations.
|PRIVATE FUNDS GROUP|
❖ Michael Dunham joined Mercury Capital Advisors in February 2022 as a Partner, Distribution. He joined from Pinnacle Trust Partners after 16 years with the firm, most recently as a Partner. He is based in New York.
❖ Charles B. Wan joined Rede Partners in March 2022 as Managing Director and Head of Asia in the firm's newly opened Hong Kong office. He joined from Atlantic-Pacific Capital, where he was most recently a Partner, PE Origination, Distribution and Secondary Advisory.
❖ Claire Woolston Commons joined Campbell Lutyens's Secondary Advisory business in April 2022 as a Managing Director. She joined from Palico, where she was most recently Chief Operating Officer and Head of Strategy. She is based in New York.
❖ Abhijit Mitra is joining the Secondary Advisory business within UBS's Private Fund Group. He joined from Lazard Private Capital Advisory, where he was most recently a Managing Director. He is based in New York.
❖ Cory D. Calvert joined Apollo Global Management in March 2022 as Head of U.S. Wealth Management in Los Angeles. He joined from Griffin Capital Securities, where he was a National Sales Director.
❖ Edward Moon joined Apollo Global Management in January 2022 as a Managing Director and Head of APAC Global Wealth Management Solutions. He was previously at HSBC, where he was a Managing Director and Head of Alternative Investments for APAC for four years. He is based in Hong Kong.