A trader walks into a bar at a conference. Inside, a group of allocators are standing and talking. The trader walks up to them. They say hi to him and, when they discover that he’s an emerging manager, they ask him what makes him so special. He says, “I trade just like John Henry.”
What Is Branding?
By design or by default, a brand is who you are. It’s an intangible; it’s your “persona”, your uniqueness, what sets you apart from others. It’s what people think when they hear your name or the name of your firm. It’s how you show up, how you introduce yourself. Lida Citroen, founder of LIDA360, a personal branding and reputation management firm, says, “’Reputation’ might be a better word. What are you going to tell the marketplace about who you are and what you stand for? Are you responsive? Are you empathetic? Do you value certain traits? What makes you different? What makes you valuable? Are you articulate? Can people trust you?”
Why do you need to Brand?
According to Lida, branding is the story, the connection, the way you’ll represent yourself in the market. She stresses that your reputation precedes you. It’s what people say about you online; whether they refer you or endorse you. Lida cautions; an online reputation is permanent. What you type into an electronic device is permanent and public. Think of how you’d feel, she says, if you viewed a LinkedIn profile of a celebrity only to find, when you meet them, they’re really quiet, shy and non-communicative. There’s a mismatch; an inconsistency. That’s not good branding.
Your branding is your fingerprint; it’s your DNA in the industry. It’s a combination of the strengths and weaknesses of both you and your company. Knowing how to recognize them, capitalize on them and cultivate them so they can help you stand out from the rest of the other traders will put you in much better position when searching for capital allocations.
Jack Schwager, author of Market Wizards and one of the founders of FundSeeder (FundSeeder.com), a platform designed to find undiscovered trading talent and connect unknown successful traders with capital sources through its sister company FundSeeder Investments, says that there are so many managers now that sophisticated investors are not simply looking for performance that meets a certain criteria; they’re looking to understand what’s behind that performance so they can have some comfort that there is a better than even chance that performance will persist in a positive sense in the future. That requires understanding what the trader is doing and the ability of the trader to properly articulate what they are doing that others aren’t.
Jack comments that networking is also a big part of our business – “Having somebody tell me that this manager is a stellar person that knows what they’re doing and that they communicate well… these are important. That will lead to other investors wanting to look at that person. Being proactive, communicative, honest, straightforward and taking responsibility with your investors makes it more than likely that one investor will give your name to another investor.” In other words, your branding or your “reputation” does get passed around – whether you know it or not!
Isn’t Branding Just Another Name for Marketing?
“No”, says Lida. “Branding is who you are. Marketing is what you are; marketing is the product; that’s why branding comes first. Branding makes marketing easier. Branding creates your ability to influence and inspire”.
Bryan Johnson, Managing Director of Johnson & Co, a marketing and fundraising consulting firm, concurs and tries to help managers visualize the concept: “Your brand is your avatar; your mosaic of all the things you are, both personally and professionally and all the components and people that come in contact with you and other people.
When that avatar gets created, it tells a consistent believable, verifiable and sustainable story about you, your processes and your performance. Bryan says, “Your branding is a meld of the personal qualities and the professional skills so you can tell people who you are. If I look at each component as a different color, it adds to the mosaic. Your avatar needs to be rich in color, in depth and in substance. You don’t want to be monochromatic or flat because the richness of the mosaic is what captures the attention of the investor. For example, if operations is represented as pink and I don’t see pink, your operational issues are not going to shape that mosaic well.“
Bryan reinforces Jack’s comments and says investors are additionally looking at:
- Personal qualities of the individuals of team
- Distinctive attributes of the operational blueprint including service partners
- Clear articulation of processes that comprise investing differentials
- Granular input that enables sustained enterprise wide execution for investor performance and business continuity
“All of the above is part of the branding. That’s your avatar!”, he says. “And when you’re in the presence of an investor, you want a rich picture of you so everything else pales in comparison.”
When Do You Start To Brand?
Experts like Lida, Bryan and Jack have been very clear that your branding or reputation follows you everywhere, so you should start to brand at the very beginning of your journey in the industry. In other words, now!
Frank Pusateri, co-founder of CTAExpo, believes branding is the tool that helps you compete. By doing proper research, branding allows you to efficiently market to the right client for your product by automatically defining the avenues you should for marketing and to whom you should market. It also shows you how to compete with other traders for equity.
Frank’s concern is that traders tend to do the wrong thing: They spend money getting their marketing materials together – including a website – with no real pre-thought. Then they try to raise money and spend more money traveling or going to high priced conferences that are aimed at seasoned managers. They call on the wrong client and highlight the wrong thing, like simulated data. (Who cares about simulated data???) And none of it works. So they then hire a marketing firm, and spend even more money. When asked, new managers generally can’t give a valid reason why an allocator should hire them. A lot of the problem, Frank says, is that there is no time or effort spent to understand themselves, the industry, the buyers and the competitors and factor all of that into a manager’s branding formula .
How do you know if you’ve gotten it right? Frank says “The ultimate test of branding is to go out and try it on other people. If it doesn’t get a good response, go back to the drawing board!”
Carol R. Kaufman
Alternatives TLC, LLC
Carol R. Kaufman, Founder/CEO of Alternatives TLC, LLC, has been an entrepreneur for over 35 years. Her first software product, InvesTier®, which handles Alternative Funds and Fund-of-Funds back office and investor accounting, was acquired by SunGard in 2002. Ms. Kaufman’s specialties include hands-on operational and organizational consulting to emerging managers and small businesses, performing operational and IT due diligence. She resides in Ridgewood, NJ and Otis, MA.