IPE’s new service for pension funds
IPE-QUEST.com is a new service which allows pension funds and other institutional investors to carry out asset manager searches through the internet. Designed to meet the needs of these investors and their consultants, IPE-QUEST.com is founded on three principals:
p confidentiality - the investor/ consultant’s identity is never revealed
p no fees – investors/consultants use the service free of charge
p no obligation - there are no conditions placed on investors/consultants using the system
Is it a Request for Proposal service? Absolutely not. IPE-QUEST.com is part of the first step to finding the right manager for a mandate. And it isn’t just for pension funds. Any institutional investor interested in appointing an external asset manager - pension funds, insurance companies, foundations, banks, corporate treasuries, even other asset managers - can use IPE-QUEST.com during the initial search.
So how does it work?
p investors/consultants place Quests - manager searches - onto the system by completing an online questionnaire which is emailed to IPE-QUEST.com
p the investor/consultant will then be contacted to verify the information and check the details before the Quest is placed live on the system
p asset managers search the system for Quests they are qualified to manage and pay a small fee to submit online application forms through IPE-QUEST.com (see panel)
p the data from the application forms is collected electronically by IPE-QUEST.com and, on an agreed date, is forwarded to the investor/consultant as an Excel spreadsheet
p it is then up to the investor/consultant to decide if they want to contact any manager/s whose details are of interest
During the initial launch period in July and August five European and two US investors placed mandates onto IPE-QUEST.com with a total value well in excess of $350m. During the same period over 50 asset managers signed up to search the system and submit online application forms.
Confidentiality is the key - many pension funds are resentful of any publicity surrounding the process of searching for and appointing asset managers – but two of the pension funds which helped IPE-QUEST.com during the initial research have been kind enough to agree to make public statements about the system.
Gerrit Russelman, Director Equity Investments, PGGM Pensioenfonds in the Netherlands said: “Our conclusion is that we think IPE-QUEST.com is a good way of starting a possible manager-relationship.” And from Karel Stroobants, Deputy General Manager, VKG in Belgium: “I am convinced that this initiative will add value to the search process initiated by pension funds, and give the opportunity to small funds to approach their searches in a more professional way and to run them more independently.”
Since then IPE-QUEST.com has also received very favourable comments (which must remain anonymous) from a pension fund which placed details of a European equities mandate onto the system, stating that: “This is without any doubt valuable information.”
So it would appear to work for pension funds, but does this translate into success for asset managers? It is a little early to judge since the first Quests closed at the end of July and no appointments have yet been made.
However, asset managers using the system have already been contacted in response to their applications. Peter-Hans Budde, Manager, Business Development at Robeco Group emailed IPE-QUEST.com to say: “We have received an invitation from a European pension fund to provide information regarding our mid/small cap capabilities. We had not previously dealt with this pension fund and asked them for some additional details about themselves. This invitation is as a result of our application submitted via IPE-QUEST.com - it works.”