THE NEW GENERATION OF FRENCH ENTREPRENEURIAL ASSET … · Paris Paris Europlace Financial Forum July 10&11, 2013 THE NEW GENERATION OF FRENCH ENTREPRENEURIAL ASSET MANAGERS Alain

ParisParis Europlace Financial ForumJuly 10&11, 2013

THE NEW GENERATION OF FRENCHENTREPRENEURIAL ASSET MANAGERS

Alain LECLAIR, Chairman of EMERGENCE

Paris Europlace Financial Forum

July 10 &11 2013, Paris

THE FRENCH EMERGING

ASSET MANAGER

SEEDING PLATFORM


The leading world GDP zone of 12,900 bn Euros (500 millioninhabitants)

Over 9 trillion Euros of assets of investment funds(equivalentto the US size)

Cross border investments favoured by the Euro (1999)

UCITS : worldwide leading regulated investment fund

Safe regulatory framework

• Strong European regulatory convergence for financial marketsand asset management (MIF, UCITS, AIFM, EMIR, etc.)

EUROPE : FIELD OF OPPORTUNITIES FORASSET MANAGERS & NEW INITIATIVES

2

Billion Euros

4217

Source : IIFA

(Dec. 31, 2012)


THE ONGOING SHIFT IN THE FINANCING OFTHE EUROPEAN ECONOMY CREATES ANINCREASED ROLE FOR ASSET MANAGERS

Rebalancing of banking to the benefit of market andalternative financings, consequences of Basel III and SolvencyII

3

Breakdown of the AmericanEconomy financing

Breakdown of the European Economy financing

Today In 5 years

Bank financing Market financing

?


Source: EFAMA,AFG, CSSF, IFIA

Funds Managers’ centers in Europe9,000 bn € at end – December 2012

Assets domiciliated in Luxemburg and Irland reallocatedto promoter’s country of origin – AFG estimates

2nd in Europe (18%) and 3rd worldwide for funds domiciliation

FRANCE: THE LEADING CENTER FOR FUNDMANAGERS

1st in Europe and 2nd in the world, after the USA


DYNAMICS OF THE PARIS FUND INDUSTRY

2,900+ billion eurosunder management

• + 53 % in 10 years

600 Paris-basedasset managers

• +50% in10 years

200 new managersover the last 5 years

4 global asset managers among the top 20 global ranking

Strong foreign customers basis : 71 % of Paris-based assetmanagement companies have foreign customers

Source: AMF

A growing number of management companies in France


STRENGTHS OF THE PARIS FUND INDUSTRY

International recognition of the French managers’ very highlevel of professional expertise

• Diaspora of French professionals to London, Chicago, Boston, Shanghai,Middle East institutions

• Top education and research of French Universities and Business Schools,especially in the quantitative area

Laboratory of asset Management innovation and technology:quant, risk intelligence, insurance, product structuration,derivatives

Smart regulation (AMF) focused on investor protection, riskmanagement, conflict of interest

Pervasive culture of risk

State of the art technological support and securities servicespart of a comprehensive asset management value chain

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European champion for entrepreneurial Asset ManagementCompanies (400+)

• France is the only financial place in Euro-zone with a large number ofindependent Asset Management Boutiques

A new generation of entrepreneurs

• Enlarged scope of assets and techniques

• Experienced professional spinning off of private banking, family offices,investment banking, insurance groups, corporates, capital market structuresto launch their own entrepreneurial asset management company

Major successes over the past 10 years:

• Carmingnac, CFM, Comgest, TOBAM, Financière de l’Echiquier, La FrançaiseAM, Mandarine, etc.

Over 200 French applications to the major incubators in thepast two years

7

STRONG ENTREPRENEURIAL DYNAMICS INFRENCH BOUTIQUES


EMERGENCE ABSOLUTE PERFORMANCE

The French Emerging Asset Management Seeding FundSponsored by Paris EUROPLACE

Created in 2012 with initial 150 mn € asset undermanagement

9 major French and European institutional investors

Keys of success :• Innovative investors governance (Investment Committee)

• Fee-sharing

• Detector of new talents

• Efficient screening tool for investors

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EMERGENCE: THE SUBFUNDS

1st subfund « Absolute Performance » Seeding investment advisor: NewAlpha AM

• Eiffel Investment Group - Eiffel Credit Opportunities: European credit long/short

• Bernheim Dreyfus – Diva Synergies UCITS: event driven

• KeyQuant – KeyTrends UCITS: managed futures

• Rcube – Rcube Global Macro UCITS: global macro

• 1 additional under review: long/short equity…?

2st subfund « Long Equity » Nominated seeding investment advisor: NewAlpha AM – NExT AM

• Orientation: Equity and equity linked

• Early stage asset manager applications: starting July 2013

• Institutional fund raising: starting July 2013 through year-end

• Selection: by the Investment Committee designated by the Emergence Board of

Directors

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MORNINGSTAR

Emerging Managers : A Key Trend in France & Europe

Post-Lehman crisis

• Difficult period for the industry

New generation & Key people leaving

Regulation

• Passport for Funds and Companies (UCITS, AIFM…)

Retail Banks / Open architecture model

Digitalization, Mobile, Smartphone, Social Network :

• From B-to-C to C-to-B

Competition by Cross-Border Players (BlackRock, Pimco…)

Barbellization of the Industry : LowCost / Premium

The Power of the Brand

Banking disintermediation and the transfer to the AssetManagement

• Crucial role in financing the real economy in the future

A new eco-system

• Institutional Investors, Individual Investors, Academics, Asset Managers…

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NEWALPHA ASSET MANAGEMENT

The only ‘pure player’ without source of conflicts of interest inselecting emerging managers for external clients

• Investment management company regulated by France’s AMF

• 10 professionals averaging 17 years’ experience and supported by OFIAM, ranked 2nd best French investment manager by local investors*

21 seeding partnerships with early stage managers, of which 12are running

• 5 seeding partnerships realized in the last 12 months

• $ 810 mn in cumulative seed capital or acceleration investments

• $ 3+ bn managed by currently partnering managers

• 1,800+ projects analyzed since 2005

• Talks with 460+ emerging managers in the past 12 months

• Multi awarded investment group in 2010, 2011 and 2012

11* : 2012 Image & Finance survey


NEXT ASSET MANAGEMENT

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NExT AM enhances and promotes entrepreneurial innovation inasset management, since 12 years

• NExT AM is a subsidiary of La Française Group, specialized in minority stakeholdings in AM

• NExT AM created, in conjunction with institutional investors, the first French“seeding partner fund”, which combines seed money and equity stakes ininnovative projects

• 30 partnerships and fourteen equity stakes in asset management companies,advisory and distribution firms in France and abroad that manage or advise 4bn € in assets

• NExT AM develops a resource-pooling platform, rolling out services dedicatedto managers to underpin their development


Two complementary business models converging to create the Europeanleading incubator

The teams will physically converge and team members dedicated toEMERGENCE Absolute Performance will remain assigned to managing thesubfund

THE COMING STRUCTURE: NEWALPHA AM- NEXT AM

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European leader in seedingbusiness

• 1.3 bn € of aggregate seed money

• 67 investments realized since thecreation of the two entities

• 49 active partnerships, of which 15abroad

• 7 bn € assets managed by partneringmanagers

• 260 jobs created

• Strong presence

in France

• ‘Equity stake’approach

• Long only & privateequity expertize

• Support for emergingmanagers

• Global sourcingcapacity

• ‘Revenue sharing’approach

• Internationally knownbrand

• Alternativeinvestment


PMs: Robert Baguenault de Viéville & Raphaël Gelrubin

Flagship strategy: Key Trends Program (AUM = $170 mn)

Systematic diversified medium/long-term trend-following

Unique perception of risk

Global Economic Factor (« GEF »)

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KEYQUANT: KEY TRENDS PROGRAM


RCUBE: RCUBE GLOBAL MACRO FUND

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A Global Macro research firm since 2008

Flagship product the Rcube Global MacroPortfolio has generated an uncorrelated9,1% net return since inception in April 2008

Rcube Asset Management

- Investment management company AMFRegulated

- Team of 8 investment professionals

$ 80 mn total seed-capital : Cayman fundand Luxembourg UCITS (Q4 2013)

• Strategic partnership with the FriedbergMercantile Group ($ 3 bn AUM): seedingthe Cayman hedge fund

Rcube Global Macro Fund

• Low frequency, systematic fundamentaland discretionary Global Macro

• Investment ideas generated by aproprietary software “the Macroscope”,filtered qualitatively

• Portfolio construction is discretionary

9,1% net ARoR

1,1 Sharpe ratio

7,1% max. Drawdown

8,3% volatility

65% hit ratio

-0,07 Beta to MSCI World

RCUBE GLOBAL MACRO PORTFOLIO

PERFORMANCE


GINJER ASSET MANAGEMENT

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An independent AM company founded in August 2011

A team of seasoned professionals with diverse investment experiences

Backed since inception by two renowned institutional partners, namelyBNP Paribas IP and Next AM

An innovative risk matrix allowing for a better understanding of marketdynamics

GINJER Actifs 360, a unique “Global Micro” fund, with 146 mn €($ 190 mn) of AUM after only 18 months of existence

GINJER AM: an alternative to alternative investments


CONTACTS

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Alain LECLAIR, Chairman+ 33 (0)6 07 44 31 01 / [email protected]

Anaële COJAN-BAUDANT, General Secretary,+ 33 (0)1 49 27 12 93 / [email protected]

Nicolas DUBAN, President & CEO+33 (0)1 73 00 73 36 / [email protected]

www.next-am.com

Antoine ROLLAND, President & CEO+33 (0)1 56 68 54 49 / [email protected]. newalpha.net

Cyril Castelli, President & CIO+33 (0) 7 77 25 87 41 / [email protected]

Mathieu VAISSIE, Head of Research+33 (0) 1 70 36 61 77 / [email protected]

Raphaël GELRUBIN, Co-founding partner & PM+33 (0)1 55 27 27 06 / [email protected]

Jean-François Bay, CEO+33 (0)6 20 28 16 21 / [email protected]


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EMERGENCE

The French Emerging Asset Manager Seeding Platform

Created in January 2012 by major French and European institutional investors, EMERGENCE

was initiated by the competitiveness cluster Finance Innovation, sponsored by Paris

EUROPLACE and the AFG (French Asset Management Association).

EMERGENCE aims to provide investors an access to the most promising independent emerging

managers, both in terms of investment and development. Thanks to the seed money allocated

to these emerging managers during their early stages, EMERGENCE boosts their development

and increases their credibility, particularly vis-à-vis international institutions.

EMERGENCE offers its investors a double source of performance (seeded funds’ performance

and participation to the growth of selected managers).

The first sub fund EMERGENCE “Absolute Performance” finishes its first year of existence with 150

million Euros under management, 9 large institutional investors and 5 seeding partnerships

after a stringent selection (over 130 applications) by the Investment Committee and

NewAlpha AM - the seeding investment advisor manager of the fund.

The platform is dedicated to different asset classes (long equity, absolute performance, RSI,

etc.) managed by specific incubator advisers.

The second sub fund “Long Equities” will seed funds offering innovative strategies and specific

skills in the field of equities. This objective is consistent with the ongoing rebalance between

bank financing and alternative financial market financing (as a consequence of Basel III). It

could also contribute to various initiatives currently undertaken to strengthen European stock

markets. After a selection process NewAlpha AM and NExT AM have been jointly appointed

seeding investment advisor for the sub fund “Long Equities”. Fundraising will start during the

summer and last through year end.

Alain LECLAIR, Chairman, EMERGENCE

Documents

THE NEW GENERATION OF FRENCH ENTREPRENEURIAL ASSET … · Paris Paris Europlace Financial Forum July 10&11, 2013 THE NEW GENERATION OF FRENCH ENTREPRENEURIAL ASSET MANAGERS Alain