BACKGROUND

Andrew Abbott and James Ziemba spent the early years of their careers as engineers working in the oil and gas industry. As their paths continued to cross, they discovered they shared similar values, career goals and interests. Leaving their engineering roles behind, they teamed up to launch Gaines Capital in 2020. After launching Lorenz Fund, a multi-strategy hedge fund targeting low correlation and positive skew, they worked with their original administrator for two years before learning that the firm wanted to scratch their existing contract and raise their monthly fees by 82%. This motivated the two partners to search for a new administrator, specifically focusing on competitive fees, high-quality service and leverageable technology as primary considerations. Andrew shared, “There was never an egregious error with our original provider but it became apparent that they were not an institutional caliber service provider.”

WHY NAV

High-Touch Service Coupled with Competitive Pricing For emerging managers, fees are a primary consideration. In their search for a new administrator, Andrew and James spent two months researching other options and narrowed it down to two possible providers. Andrew shared, “From the beginning, we thought NAV looked like a great firm. The fees quoted to us were completely transparent from the start, whereas we felt other firms unfortunately had a “nickel-and-dime” approach. Many fees were disclosed weeks into our conversations. As a small business, we needed all fees to be disclosed upfront.” He continued, “Other firms also didn’t seem 100% sure about how much to charge for our NFA requirements; it felt like they were pulling numbers out of thin air.”

Streamline Reporting with Regulatory Requirements From a compliance standpoint, there were other concerns related to particular NFA rules. Andrew shared, “Other firms didn’t seem fully versed in certain NFA rules and specific items we need to legally disclose for the fund to be compliant. They were hesitant to include these details in our contract. With NAV it was easy, simple and streamlined. Pricing was transparent, which was a huge value to us. In the end, we chose NAV for several reasons. The investor portal provided an immediate benefit for our investors, and the pricing offered a great value.”

Seamless Transition Process For fund managers, making the decision to switch to a new administrator often raises concerns about disruption, security and added costs. But transitioning to NAV was never a problem for Gaines Capital. Andrew shared details about their transfer process. “Transitioning to NAV was seamless. Our monthly statements were completed and distributed quickly. Madhusudan and his team had an “all-hands-on-deck” approach to getting us up and running. We were so pleased that we weren’t relegated to the back of the line due to the smaller size of our fund.”