News

April 8, 2019

Join Corgentum at the Emerging Manager Forum in New York City

Emerging hedge fund and private equity particularly face a number of unique challenges in first designing and then managing their operational infrastructures. These challenges continue when nascent fund managers seek to explain their operations to prospective investors during the operational due diligence (ODD) process.

To discuss these challenges, Corgentum Consulting Managing Partner Jason Scharfman will be presenting at a session entitled, The Changing Operational Due Diligence Landscape at the upcoming Emerging Manager Forum 2019 - New York. The conference takes place from April 10 - 11th at the New York City offices of Grant Thornton. The operational due diligence session at which Mr. Scharfman is presenting will take place from 3:45pm - 4:30pm on Wednesday April 10th.

Topics anticipated to be covered during the presentation include:

  • New manager startup expense management and allocation considerations
  • Trends in operations and compliance management for emerging managers
  • The increased investor focus on fund governance and the role of board members
  • Techniques by which emerging managers can mitigate key operational risks
  • Guidance for emerging manager to effectively manager the onsite operational due diligence process

We hope to see you at the conference!

March 26, 2019

Corgentum Discusses Private Equity Compliance and Governance Trends with Fund Shack

Issues related to governance and compliance in private equity funds continue to garner attention from General Partners (GP's), Limited Partners (LP) and regulators. Corgentum Consulting Managing Partner Jason Scharfman recently sat down to discuss trends in this area with Fund Shack.

Topics covered during the interview include:

  • The evolving sophistication of private equity compliance frameworks as compared to hedge funds
  • GP conflict of interest considerations
  • The role played by Limited Partner Advisory Committees (LPACs) and other governance considerations
  • Analyzing the increasing role of GP compliance related expenses
  • Trends in fund specific terms and accompanying LP disclosures
  • Private equity regulatory trends with a focus on US SEC examination priorities for private equity and venture funds

The full interview is available on the Fund Shack website (signup required).

March 15, 2019

Research Update: Survey Shows Investors Re-emphasize Compliance and Cybersecurity During Operational Due Diligence

A new survey by Corgentum Consulting announced today, shows that both investors and operational due diligence (ODD) analysts in hedge funds and private equity managers feel that the scope, depth and complexity of ODD reviews has continued to increase. Specifically, 82% felt that this increased complexity has added substantial challenges to the ODD process over the last year.

Renewed Focus on Compliance and Cybersecurity

A large majority of those surveyed (79%) indicated that they are spending more time analyzing regulatory and compliance risks during ODD as compared to last year. Survey respondents indicated that the compliance and regulatory related areas that have received the most focus of late include:

Those investors and ODD analysts that participated in the survey also indicated a 59% increase in the overall time that they devoted towards performing due diligence on cybersecurity and related issues including the ongoing risks of phishing scams, email spoofing and social engineering attacks.

Are Operational Due Diligence Resources Keeping Up With Fund Manager Complexity?

A second trend that emerged from the survey results was that despite this increasing regulatory and cybersecurity complexity, the resources allocated to operational due diligence have not kept up commensurately. Specifically, 79% of respondents admitted that they have not increased operational due diligence resources to sufficiently keep up. This resource mismatch appears to not only be contained to initial pre-investment reviews, with 89% of ODD analysts that participated in the survey indicating that felt they did not have enough time or resources to thoroughly monitor operational risks on a post-investment basis. Furthermore, 68% indicated that they felt their background investigations on fund managers could be more rigorous.

“The data shows investors are being tasked with more complex operational due diligence challenges and that is straining existing resources. As the compliance and technology environments for hedge funds and private equity continue to evolve, allocators must consider how they will devote more resource toward operational due diligence to evaluate and monitor these risks going forward,” said Jason Scharfman, Managing Partner of Corgentum Consulting.

Corgentum conducted this survey as part of the firm's webinar series. The results were first presented exclusively to premium subscribers of Corgentum's monthly newsletter, Due Diligence News.

Would you like to be the first to know about our latest surveys and trending operational due diligence industry news? Sign up for our newsletter today!

February 22, 2019

Research Update: Survey Shows Investors Re-emphasize Compliance and Cybersecurity During Operational Due Diligence

A new survey by Corgentum Consulting announced today, shows that both investors and operational due diligence (ODD) analysts in hedge funds and private equity managers feel that the scope, depth and complexity of ODD reviews has continued to increase. Specifically, 82% felt that this increased complexity has added substantial challenges to the ODD process over the last year.

Renewed Focus on Compliance and Cybersecurity

A large majority of those surveyed (79%) indicated that they are spending more time analyzing regulatory and compliance risks during ODD as compared to last year. Survey respondents indicated that the compliance and regulatory related areas that have received the most focus of late include:

Those investors and ODD analysts that participated in the survey also indicated a 59% increase in the overall time that they devoted towards performing due diligence on cybersecurity and related issues including the ongoing risks of phishing scams, email spoofing and social engineering attacks.

Are Operational Due Diligence Resources Keeping Up With Fund Manager Complexity?

A second trend that emerged from the survey results was that despite this increasing regulatory and cybersecurity complexity, the resources allocated to operational due diligence have not kept up commensurately. Specifically, 79% of respondents admitted that they have not increased operational due diligence resources to sufficiently keep up. This resource mismatch appears to not only be contained to initial pre-investment reviews, with 89% of ODD analysts that participated in the survey indicating that felt they did not have enough time or resources to thoroughly monitor operational risks on a post-investment basis. Furthermore, 68% indicated that they felt their background investigations on fund managers could be more rigorous.

“The data shows investors are being tasked with more complex operational due diligence challenges and that is straining existing resources. As the compliance and technology environments for hedge funds and private equity continue to evolve, allocators must consider how they will devote more resource toward operational due diligence to evaluate and monitor these risks going forward,” said Jason Scharfman, Managing Partner of Corgentum Consulting.

Corgentum conducted this survey as part of the firm's webinar series. The results were first presented exclusively to premium subscribers of Corgentum's monthly newsletter, Due Diligence News.

Would you like to be the first to know about our latest surveys and trending operational due diligence industry news? Sign up for our newsletter today!

January 15, 2019

Is your Operational Due Diligence Program Equipped to Handle New Regulatory Changes in 2019? Signup for Corgentum's Next Webinar to Find Out

2019 brings with it a new series of challenges for those seeking to evaluating operational risk in fund managers as part of the operational due diligence (ODD) process. Corgentum Consulting announced today that it will be hosting the first webinar in its 2019 series. This webinar will focus on emerging trends in investor operational due diligence (ODD) approaches for hedge fund and private equity for 2019 with a key focus on updates on US SEC and UK FCA regulatory exam priorities. The session will take place on Wednesday, January 23, 2019 beginning at 10:30am EDT. Signup today!

Topics that will be covered during the webinar include:

  • How to develop and implement an action plan for effective ODD in 2019

If you are interested in attending the upcoming webinar, please signup here .

Space is limited, and priority access will be provided to premium subscribers of Corgentum's monthly newsletter, Due Diligence News . If you are not already a premium subscriber of our newsletter you can contact us to learn more.

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