Emerging Manager Definition and Life Cycle

The Emerging Manager Program has compiled guidance including a Universal Definition and Life Cycle Stages to assist in consistent screening, monitoring and progression of potential candidates for inclusion in the program, independent of asset class considerations.

The Fund’s Emerging Manager Universal Definition includes characteristics such as:

  • majority owner-managed;
  • verifiable successful track record in the proposed strategy;
  • manager orientation towards investing to build an institutional investor-ready firm;
  • sound compliance and operating standards;
  • institutionally-trained professionals;
  • firm’s principals have years of experience working in the strategy and with each other; and
  • fiduciary practices.

Life Cycle Considerations

Within a portfolio approach, the Fund and program partners seek to diversify exposure by stage of emerging manager life cycle. Informed by the 2018 survey, the following are guidelines often considered when the Fund considers business life cycle stages.

Stage Traditional Attributes for the Stage
Seed & Early 

Firm typically has managed money for institutional investors less than five years

  • Access to sufficient capital to procure appropriate infrastructure;
  • Growing base of investors;
  • Access to sufficient capital for investment team build-out and co-investment in the strategy that is meaningful for alignment; and
  • Sufficient full-time staff with tenured industry experience.
Mid & Late
  • Well capitalized firm that shows positive operating cash flows;
  • Key internal infrastructure in place, with redundancies in mission-critical investing and operating processes;
  • Reasonable growth assets under management (AUM) in last three years;
  • Increased breadth of ownership and reduced key person risk; 
  • Increased diversification of investors by type of investor; and
  • Established appropriate environmental, social and governance (ESG) policies and procedures.