Shaw Capital Working Management News Worldwide: Twitter Tests New Ad Types

http://financial.shaw-capitalworkingmanagement.com/2011/07/shaw-capital-working-management-news-worldwide-twitter-tests-new-ad-types/

http://online.wsj.com/article/SB10001424053111904800304576474100156000380.html

JULY 29, 2011

BY AMIR EFRATI

To make good on its ballooning multibillion-dollar valuation, online-messaging service Twitter Inc. must pass the Sephora test.

Initially, Sephora, the makeup retailer that is part of luxury-brand-giant LVMH, didn’t allocate any funds for Twitter’s young advertising system for this year. But in February, it bought more than 15 Twitter ads to promote a contest for customers in which it gave away products to fans of the Fox show “Glee.” According to its analysis, the response rate from the Twitter ads beat its projections by 700%.

So Cathy Choi, Sephora’s social media director, sought additional money—she declines to disclose how much—to try out Twitter’s newest ad offering, which rolled out Thursday. Called “promoted tweets to followers,” it lets brands and charities pay to make sure that their followers see messages they send out on Twitter even if the followers don’t log on to the service until hours after the messages are sent.

It’s the latest move by the San Francisco-based company, which lets people broadcast messages of up to 140 characters known as “tweets,” to build up its fledgling online advertising business. Despite the relatively nascent nature of that business, investors have pumped up the valuation of the closely held company amid a new Silicon Valley boom. Twitter is currently raising a new round of financing that would value the company at around $8 billion, according to a person familiar with the matter.

Twitter, which launched its ad system in April 2010, is on pace to generate $150 million in ad revenue this year, research firm eMarketer has estimated. The microblogging service is home to thousands of brands, from Coca-Cola Co. to local bakeries, that work to gain “followers,” or people who track the brands’ tweets about new products and promotions. About 20% of Twitter users “follow” a brand, according to a survey by marketing firm ExactTarget.

Twitter, which has more than 200 million registered accounts, said its new ad offering is being rolled out slowly and only for a couple of dozen advertisers, including Microsoft Corp. and Starbucks Corp. Twitter advertisers pay a fee, determined by an automated auction, only if a user selects their ad, including clicking on a link or “retweeting” the message to the user’s followers.

Overall, Twitter sales chief Adam Bain said the company has opened its ad system to more than 1,000 advertisers, including many small businesses, and about 80% have made more than one purchase. He added that many tweets by such brands as Walt Disney Co. have become viral hits on Twitter after users retweeted the ad.

Twitter began rolling out ad offerings last year using a format called “promoted tweets” that lets marketers place bids to show ads to Twitter users who perform searches on the Twitter.com home page. It later added “promoted trends,” which are ads that cost $120,000 a day and appear alongside each user’s account and on Twitter.com’s home page, among other ad offerings.

Not all of Twitter’s ad features have succeeded. An experiment called the “quick bar,” which Twitter introduced in March to users of its iPhone application, showed ads and hot topics on the service, but it was removed after an uproar from some users who felt it was too intrusive.

“We’re still testing it to figure out what works, but Twitter is one of the more promising channels for us going forward,” said Abby Lunardini, vice president of corporate communications for the airline Virgin America, which has paid for 65 different Twitter ads since last year. She declined to disclose how much the company spent.
Digits

Alison Moore, senior vice president of digital platforms for Home Box Office Inc., said she expects Twitter’s latest ad offering to be a “very focused way for us to show the most relevant brand information to the people who raised their hands and want it most.”

HBO expects to use the ads to promote its online video service HBO GO and merchandise for shows such as “True Blood,” which has more than 264,000 followers on Twitter, she said.

Twitter will also launch a “self-serve” ad system later this year so that anyone can buy an ad, and it is working on several other potential ad products, people familiar with the matter have said. Twitter Chief Executive Dick Costolo said earlier this month that Twitter might let marketers sell items directly on Twitter.

Shaw Capital Working Management Tips & Articles: Google’s Eric Schmidt Set For Sept. 21 Senate Antitrust Hearing

http://shaw-capitalworkingmanagement.com/2011/07/29/shaw-capital-working-management-tips-articles-google%E2%80%99s-eric-schmidt-set-for-sept-21-senate-antitrust-hearing/

JUL29
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http://paidcontent.org/article/419-googles-eric-schmidt-set-for-sept.-21-senate-antitrust-hearing/

By Sam Gustin
Jul 28, 2011 7:03 PM ET

Google Executive Chairman Eric Schmidt will testify before lawmakers probing the company’s market power on Sept. 21, the search giant confirmed on Thursday. After initially declining to appear, the former CEO received a not-so-subtle subpoena threat from the committee and rethought his position. The hearing, which will focus on charges that Google (NSDQ: GOOG) uses its market power to favor its own services and hinder rivals, comes as the Federal Trade Commission ramps up its investigation into the company’s dominance of the web search business.

Last month, Sen. Herb Kohl, the Wisconsin Democrat who chairs the antitrust subcommittee, and Sen. Mike Lee, the Utah Republican and ranking member, requested that either Schmidt or current Google CEO Larry Page testify. For its part, the company offered to send its chief legal officer, David Drummond, but Kohl and Lee insisted, warnings that lawmakers “would very much prefer to work this out by agreement rather than needing to resort to more formal procedures.”

See more of our latest Travel coverage
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The hearing title: The Power of Google: Serving Consumers or Threatening Competition?

Google’s competitors have long been pushing for greater government scrutiny of the search giant’s market power. A group of them have created an organization called FairSearch.org, which seeks to highlight Google’s abuses. Among the group’s members: Google’s search rival Microsoft (NSDQ: MSFT), as well as travel sites Expedia, Travelocity, and Hotwire, which had opposed the search giant’s purchase of ITA Software, a provider of back-end services for travel search engines.

When that deal was approved, representatives of the travel companies predicted greater scrutiny for Google.

Not surprisingly, FairSearch.org praised Kohl and Lee for this effort.

Proponents of greater regulation of Google’s search engine tend to argue that because the service is so ubiquitous, it has become something like a public utility. Or they claim that Google must be totally “objective” in its search results, so as not to violate so-called “search neutrality.”

Google’s supporters call such arguments nonsense and say that “search neutrality” is a fantasy. Google may be publicly traded but it is still a private company, they argue. It can place any information it wishes on its website. It is under no obligation whatsoever to even include its competitors on its web page. Furthermore, web search is inherently subjective. Google’s search rankings are judgements produced by its proprietary algorithm, which the company tweaks constantly.

At the hearing, Schmidt likely will point out that web users are free to choose any search engine they wish—the alternatives are just a click away.

Shaw Capital Working Management Tips & Articles: Segarra shares city priorities with governor

http://shaw-capitalworkingmanagement.com/2011/03/10/shaw-capital-working-management-tips-segarra-shares-city-priorities-with-governor/

MAR10


http://www.norwalkplus.com/nwk/information/nwsnwk/publish/Local_2/Segarra-shares-city-priorities-with-governor_np_12110.shtml





Mar 9, 2011 – 7:58 AM

By Hartford Mayor Pedro Segarra’s office

In a letter sent to Governor Dannel P. Malloy on Tuesday, Hartford Mayor Pedro E. Segarra outlined the City’s vision, priorities and initiatives that will help grow the local and regional economy and serve to substantially improve Connecticut’s Capital City. In his letter, Mayor Segarra referenced the Governor’s background and achievements as a former city mayor as part of his core knowledge and understanding that urban centers will play a critical role in turning around the state’s economy.

“Hartford’s success is Connecticut’s success. By moving forward on my immediate and long-term strategies, we will make Hartford the center of medical research and technology, continue to make our students more competitive in the global job market, and further establish Hartford as the state’s and region’s Arts center. Connecticut’s Capital City is perfectly positioned to help small and large businesses create jobs, enhance the City’s and the State’s quality of life, and become a choice tourist destination. My goal is to continue making Hartford a great place to live, work, play and raise a family,” said Mayor Segarra.

In addition to defining a long-term vision for the City, there are several capital and infrastructure projects that the Mayor brought to the Governor’s attention including:

1. Swift Factory: Through strong partnerships, a vacant factory will be turned into a vibrant multipurpose facility and rejuvenate a North End neighborhood;

2. Coltsville: Continue to work with the Congressional delegation to have this area designated as a national park and securing federal and/or state funding for façade improvements;

3. XL Center: The current management contract runs out in 2013, at which point the City will assume responsibility of this facility. The Mayor and his administration are in the process of laying the groundwork to make this a more vibrant and desirable venue for sports and entertainment events;

4. iQuilt: This innovative initiative crafted by The Bushnell, The Greater Hartford Arts Council, and the City of Hartford intends to knit together our wonderful social and cultural centers and enhance pedestrian routes to promote economic growth and redevelopment in the Capitol district;

5. 101 Pearl Street: The Mayor and city officials are actively pursuing creative options that would benefit the Downtown area as well as neighboring tenants;

6. Albany Avenue/Route 44: A state highway and main artery in the North End, working in conjunction with MDC to aggressively pursue funding for streetscape that would prove critical to community vibrancy;

7. Capitol Avenue: Through the Greening of America’s Capitals grant received from EPA, we are poised to work with appropriate state officials to transform areas surrounding the State Capitol to add green space, more appealing sightlines, and increased sustainability;

8. New Britain to Hartford Busway: This project will improve travel to and from the city, create about 4,000 jobs, and represent the state’s first rapid-transit system. While the City is still firm in its position to not disrupt operations at Aetna and The Hartford, this project would revitalize Asylum Hill neighborhood and reduce traffic on I-84 and I-91;

9. Lyric Theatre: A historic theatre in the Frog Hollow neighborhood that the Mayor has targeted for restoration and the future home of the Puerto Rican Cultural Center.





Other long-range projects mentioned include the Hartford Viaduct and high-speed rail. Mayor Segarra emphasized that through partnerships and a collaborative approach at the community, city, state, and federal levels, these projects will improve the quality of life for residents throughout the city, address environmental concerns, and provide employment opportunities for years to come.

Shaw Capital Working Management Tips & Articles: Rimage: A Call To Action By A Shareholder

http://shaw-capitalworkingmanagement.com/2011/03/10/shaw-capital-working-management-tips-rimage-a-call-to-action-by-a-shareholder/

MAR10


______________________________________________________________

http://www.gurufocus.com/news.php?id=125175

Mar. 08, 2011 | Filed Under: RIMG

Dear Members of the Board:

As shareholders of Rimage Corporation (RIMG), Schacht Value Investors demands a change in the company’s strategic direction and capital allocation. On behalf of our clients, who beneficially own 65,010 shares of Rimage, we request:





* A renewed focus on core business & organic initiatives.
* An end to the search for acquisition targets.
* A special dividend of at least $100 million, or $10/share.
* Engagement of investment bankers about a sale of Rimage.

The company’s enormous cash balance, which currently represents 80 percent of the company’s market capitalization, is its largest source of shareholder value. Recent statements and actions by management raise serious concerns about the intentions for this capital. Over the past year, it has become increasingly clear that Rimage’s leadership will primarily use the cash to pursue an “option” that includes acquisitions and a new “content delivery platform”.

We disagree strongly with this direction.

The current market price of Rimage shares implies a value of $140 million. Two components contribute to this value: a profitable core business that generates significant free cash flow, which at the current market price carries a value of under $30 million, and at least $100 million in cash that investors could redirect without affecting the operation and value of that core business. Even if the core business declines, by any measure, its value should far exceed the $30 million currently being assigned.

Why does the market attribute such a paltry valuation to the core business? The market assigns a negative value to the aforementioned “option” that management hopes to pursue. While management may believe that the option represents the best use of company cash, the market correctly assumes that the option will instead destroy shareholder wealth. In fact, CEO Sherman Black reinforced the market’s view only last week:

We have not given any financial estimates, because we don’t have a firm business plan that we can share with you at this time. What we have shared with you, Steve, is that we have an existing business that we feel comfortable is going to continue to generate cash flow.

We could not have said it better ourselves. Everything outside the core business is just an expensive experiment, a speculation with shareholder capital that we do not and will not support.

Focus on the Core Business

The operating portion of Rimage should be the largest component of enterprise value and the focus of management’s efforts. Management may feel “comfortable (that it) is going to continue to generate cash flow”, but the “option” is a major distraction that jeopardizes this progress.

Furthermore, instead of throwing an undefined amount of cash at the promised “content delivery platform,” management should seek further organic growth in areas that truly relate to the existing business. By their own admission, management does not have a firm plan for their new business efforts. These ventures are ill-defined and promise to consume unknown quantities of shareholder capital.

To be clear, we do not oppose investing for the future. Rather we question the nature and extent of the needed investment. The Board of Directors must resist the institutional imperative to spend the enormous store of wealth.

End the Search for Acquisitions

If we were to write a book entitled “Successful Corporate Acquisitions”, it would be a very slim text. The chapter covering technology companies would be slight to non-existent. Sherman Black acknowledged this during the 4th Quarter 2009 earnings conference call:

I can provide you with a lot of data that says companies that do what you just suggested [acquisitions] actually fail. And when you start looking multiple rings away from your core, your chances of success go way down. And that’s been documented in many, many cases. I would rather – if I thought that’s where I was going to go, I’d rather give the money back to the shareholders and let them decide where they want to take their investments.

This remark reassured us as investors, but it has started to ring hollow in light of recent statements and developments. First and foremost, the company hired an investment bank to explore acquisition targets. We are reminded that you never ask a barber if you need a haircut!

Next, the Board of Directors this week changed management incentive compensation so as to actually encourage acquisitions. The company did not discuss or even identify this critical change during the most recent earnings conference call. We thus question the ability of the current Board of Directors to represent investor interests. To encourage behavior that will likely destroy shareholder wealth strikes us as irrational.

For at least a year, investors have questioned management (publicly and privately) about capital allocation plans, particularly in regard to Rimage’s enormous and growing cash balance. Initially, management asked for time to formulate a plan, citing their short time on the job. More recently, it hinted at a plan that remains undisclosed, ill-defined, or both. Nonetheless, management assured shareholders that the cash is not burning a hole in the corporate pocket.

Hiring an investment bank and changing compensation incentives confirms investors’ worst fears. Yet the Board of Directors expects us to sit passively, content with the cash balance in the hands of management, despite signs of imminent value destruction.

Despite the general lack of transparency, one thing is abundantly clear: there are no plans to disgorge excess capital back to shareholders, where it is desired and where it belongs.

Given the checkered history of corporate deal making, this should be the first option considered, not the last.

Shareholder after shareholder has raised the issue of a special dividend. Management has dismissed us every time, with excuses, platitudes, and outright condescension. Just review the enclosed litany of exchanges regarding Rimage’s cash over the last 5 quarters (attached).





Management forgets that investors own this capital. Yet management ignores investor calls for a pro-rata share of our own cash, in favor of management ambitions, unspecified customer requests, a call for growth by the Board of Directors, and whatever gem our new investment bankers may uncover. We should not have to wait at the end of the line for our own capital.

If shareholders needed further evidence of the company’s intentions, we need only cite Sherman Black’s recent statement that accelerating growth at Rimage “will require some inorganic activity, and we’re looking at those options”. Such veiled references to acquisitions only provide further proof that management understands the unpopularity of the “acquisitions first” course.

Declare a Special Dividend

Numerous academic studies and countless examples show clearly that large excess cash balances erode management discipline and shareholder returns. Yet management ambitions often override financial concerns when shareholders fail to intervene. Even Warren Buffetthimself has weighed in on these issues saying he prefers smaller companies with higher returns on capital to bigger ones with lower returns.

Investors will not allow Rimage to become a venture capital fund. Most of Rimage’s shareholders are professional investors with a far greater capability to reinvest this capital, with the track records to prove it. Investors, including Schacht Value, have a wider choice of possible investments outside the company’s rather specific area of technology.

The company could easily return at least $100 million to shareholders and still have more than enough cash for organic opportunities and working capital. Even a distribution of this size would leave some $16m in cash to support $80m-$85m in 2011 sales. Management must demonstrate why they could not operate the current business and invest for the future with this level of remaining cash (post distribution), ongoing free cash flow, and a debt free balance sheet.

We therefore request that the Board declare a special dividend of at least $100 million. This special dividend would be additive to the regular dividend, not a replacement.

Investigate Possible Company Sale

With a low enterprise value multiple, large cash balance, and steady free cash flow capabilities, Rimage makes a natural target, not an acquirer. The only reason to hire an investment banker would be to sell the company. We can’t name a single “minnow-swallows-whale” acquisition that succeeded. Even “bolt-on” acquisitions are a mixed bag in terms of success.

Thus, in the interest of exploring all avenues of shareholder value maximization, we request that the Board of Directors engage an investment bank to solicit offers for Rimage. The best option for shareholders may well be a sale of the company, but we won’t know unless the Board of Directors explores the possibilities.

Further Comments

In anticipation of one response to our request, let us acknowledge the company’s steps to respond to shareholder discontent: engaging in modest share repurchases and declaring a regular dividend. These decisions, however, do not address the huge amount of cash in question or the risky steps being taken elsewhere in the name of growth.

For instance, despite the recently announced buyback activity, shares outstanding have actually increased. Clearly, the benefit of the share repurchases has not accrued to shareholders. Instead, it represents a wealth transfer (via stock options) to employees, making what was implicit explicit. Management only uses the share repurchases to the extent needed to offset option dilution. Whatever the portrayal, this is not a serious effort to return capital to shareholders.

Investors welcome a regular dividend as a necessary step for Rimage, but it does not address the company’s outsized cash balance. Barring any special dividend, cash will likely continue to grow, unless management wastes it on an acquisition.

So when it comes to addressing the cash hoard and/or returning a significant amount of cash to shareholders, the above activities are merely window-dressing.

Conclusion

It is time the Board of Directors upholds its fiduciary duty to protect shareholders from the management team’s ambitions, directing them to run the business at hand. While day-to-day operations may not have the glamour and intrigue of so-called “strategic matters”, Rimage investors believe they are a better use of management’s time, and our money.

Send a clear signal to existing shareholders and the wider investment community that Rimage will not burn its cash in a misguided attempt to discover the next “big thing”. The Board of Directors must consider all options for increasing value, including a sale of the company. In the meantime, the company must return excess cash to its owners.

Leave eager investment bankers and their shopping lists for others. By doing so, you will distinguish Rimage as a true steward of shareholder capital and likely cause a positive reappraisal of the company’s value.

In short, we trust management to run its existing business, not to allocate over $100 million in shareholder capital on new ventures.

Numerous concerned shareholders have patiently tried to work with management to address capital allocation. Our reasonable concerns have fallen on deaf ears. For this reason, we have lost confidence in the company’s intentions and abilities in regard to our capital.

We therefore appeal to the Board of Directors to weigh in. Please fulfill your obligation to protect shareholder value. By considering only acquisitions and token displays of affection for shareholders, directors risk being held accountable by investors for any destruction of shareholder value that results.

We await your response.

Sincerely,

Henry W. Schacht, CFA

Schacht Value Investors, LLC
P.O. Box 777
Notre Dame, IN 46556
574-273-9846

www.schachtvalue.com/rimage

_________________
Henry W. Schacht, CFA is the founder of Schacht Value Investors, an investment management firm serving individuals and institutions. He currently serves as President and Chief Investment Officer. He earned his MBA at the University Of Chicago Graduate School of Business and a BBA in finance from the University of Notre Dame. Mr. Schacht is a member of the Association for Investment Management & Research (AIMR), the Investment Analysts Society of Chicago (IASC), and the National Association of Corporate Directors (NACD).

Shaw Capital Working Management Tips & Articles: Ariba to Present at Roth OC Growth Stock Conference

http://shaw-capitalworkingmanagement.com/2011/03/10/shaw-capital-working-management-tips-ariba-to-present-at-roth-oc-growth-stock-conference/


MAR10


http://www.businesswire.com/news/home/20110309005086/en/Ariba-Present-Roth-OC-Growth-Stock-Conference





March 09, 2011 08:30 AM Eastern Time

2011 ROTH OC Conference

SUNNYVALE, Calif.–(BUSINESS WIRE)–Ariba, Inc. (Nasdaq: ARBA), the leading provider of collaborative business commerce solutions, today announced its participation in the Roth OC Growth Stock Conference on Monday, March 14 at the Ritz Carlton, Laguna Niguel. Ariba Chief Financial Officer Ahmed Rubaie will present at 1:30 p.m. ET. A live webcast of the presentation can be accessed on the investor relations section of Ariba’s website at www.ariba.com.

About Ariba, Inc.

Ariba, Inc. is the leading provider of collaborative business commerce solutions. Ariba combines industry-leading technology with the world’s largest web-based trading community to help companies discover, connect and collaborate with a global network of partners – all in a cloud-based environment. Using the Ariba® Commerce Cloud, businesses of all sizes can buy, sell and manage cash more efficiently and effectively. Over 340,000 companies around the globe use the Ariba Commerce Cloud to simplify inter-enterprise commerce and enhance results. Why not join them? To get on the path to Better Commerce visit: www.ariba.com/commercecloud/

Copyright © 1996 – 2011 Ariba, Inc.

Ariba, the Ariba logo, AribaLIVE, Ariba.com, Ariba.com Network, Ariba Spend Management. Find it. Get it. Keep it. and PO-Flip are registered trademarks of Ariba, Inc. Ariba Procure-to-Pay, Ariba Buyer, Ariba eForms, Ariba PunchOut, Ariba Services Procurement, Ariba Travel and Expense, Ariba Procure-to-Order, Ariba Procurement Content, Ariba Sourcing, Ariba Savings and Pipeline Tracking, Ariba Category Management, Ariba Category Playbooks, Ariba StartSourcing, Ariba Spend Visibility, Ariba Analysis, Ariba Data Enrichment, Ariba Contract Management, Ariba Contract Compliance, Ariba Electronic Signatures, Ariba StartContracts, Ariba Invoice Management, Ariba Payment Management, Ariba Working Capital Management, Ariba Settlement, Ariba Supplier Information and Performance Management, Ariba Supplier Information Management, Ariba Discovery, Ariba Invoice Automation, Ariba PO Automation, Ariba Express Content, Ariba Ready, and Ariba LIVE are trademarks or service marks of Ariba, Inc. All other brand or product names may be trademarks or registered trademarks of their respective companies or organizations in the United States and/or other countries.





Ariba Safe Harbor

Safe Harbor Statement under the Private Securities Litigation Reform Act 1995: Information and announcements in this release involve Ariba’s expectations, beliefs, hopes, plans, intentions or strategies regarding the future and are forward-looking statements that involve risks and uncertainties. All forward-looking statements included in this release are based upon information available to Ariba as of the date of the release, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to Ariba’s operating and financial results to differ materially from current expectations include, but are not limited to: the impact of the credit crises on Ariba’s results of operations and financial condition; delays in development or shipment of new versions of Ariba’s products and services; lack of market acceptance of Ariba’s existing or future products or services; inability to continue to develop competitive new products and services on a timely basis; introduction of new products or services by major competitors; the impact of any acquisitions, including difficulties with the integration process or the realization of benefits of a transaction; the impact of our disposition, including the potential disruption of our ongoing business; the ability to attract and retain qualified employees; long and unpredictable sales cycles and the deferrals of anticipated orders; declining economic conditions, including the impact of a recession; inability to control costs; changes in the company’s pricing or compensation policies; significant fluctuations in our stock price; the outcome of and costs associated with pending or potential future regulatory or legal proceedings; the impact of our acquisitions and dispositions, including the disruption or loss of customer, business partner, supplier or employee relationships; and the level of costs and expenses incurred by Ariba as a result of such transactions. Factors and risks associated with its business, including a number of the factors and risks described above, are discussed in Ariba’s Form 10-Q filed with the SEC on February 2, 2011.

Ariba, Inc.
Investor Contact:
John Duncan, 650-390-1200
Investor@ariba.com
or
Media Contact:
Karen Master, 412-297-8177
kmaster@ariba.com

Shaw Capital Working Management Tips & Articles: Bay Area’s Bacchus Capital Management gets back into wine investing game

http://shaw-capitalworkingmanagement.com/2011/03/10/shaw-capital-working-management-tips-bay-areas-bacchus-capital-management-gets-back-into-wine-investing-game/

MAR10
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http://www.bizjournals.com/sanfrancisco/news/2011/03/09/sfs-bacchus-capital-management-gets.html





San Francisco Business Times – by Chris Rauber

Date: Wednesday, March 9, 2011, 4:12pm PST
The Bay Area’s Bacchus Capital Management LLC, an investment and advisory firm specializing in the wine business, says it will provide an unspecified amount of growth capital to Qupé, a Central Coast wine producer.

“Working with the team at Bacchus will provide us with the working capital we need to expand our inventory, our production and our distribution so that we can continue our growth and build on our momentum,” Qupé’s founder, owner and winemaker Bob Lindquist said in the March 8 statement.

Peter Kaufman, a Bacchus principal, told the San Francisco Business Times that Qupé produces about 35,000 cases a year and wants to expand up to 70,000 cases, and “we want to help fund that growth.”

But no one will say anything about the size of the funding package. Kaufman said its range is up to $10 million.

Bacchus was launched in 2007 by co-founder and Managing Partner Sam Bronfman, former president of Seagram Chateau and Estate Wines, Kaufman and Henry Owsley, who are president and chief executive officer, respectively, at Gordian Group LLC, a New York-based investment bank.

Officials describe Bacchus as a San Francisco company, but its corporate office is actually located across the Bay and over the hills in Pleasanton.

Also, until this month, Bacchus hadn’t announced any deals or had much to say for itself since late 2008, when it provided financing to San Francisco’s Cameron Hughes Wine, until now the only investment deal mentioned on its website.

In any case, the two companies said this week that Qupé is at “a critical point in its brand and business evolution,” after three decades of producing Rhône varietals and Chardonnay. The fresh capital from Bacchus will enable the Los Olivos wine producer to expand inventory, production and distribution.





And stay tuned, says Kaufman, because “this is a paradigm for more things we’re looking to do.”

Read more: Bay Area’s Bacchus Capital Management gets back into wine investing game | San Francisco Business Times

Shaw Capital Working Management Tips & Articles: Site optimizer HubSpot raises $32M from Google, Salesforce and Sequoia Capital

http://shaw-capitalworkingmanagement.com/2011/03/09/shaw-capital-working-management-tips-site-optimizer-hubspot-raises-32m-from-google-salesforce-and-sequoia-capital/

MAR9
1 Vote

http://venturebeat.com/2011/03/08/hubspot-funding-series-d-32-million/

Matthew Lynley





March 8, 2011

HubSpot, an online marketing and content management suite, announced today that it has raised $32 million from Salesforce, Sequoia Capital and Google’s investing arm, Google Ventures, in its fourth round of funding.

The service “grades” websites and determines how often they will pop up in high spots on search engines — a process called search-engine optimization (SEO). The service also gives smaller- and mid-sized companies tools to quickly create and manage blogs and landing pages for their websites. The analytics part of the software gives companies a way to track the behavior of incoming and outgoing site visitors and tune the website to make them more likely to stay.





Salesforce in particular seems to be throwing around a lot of money lately — the company has made three acquisitions in the past couple of months. It dropped a whopping $212 million on Web-application developer Heroku in December, and then spent an undisclosed amount on email contact manager Etacts. Salesforce also acquired Web-conferencing provider Dimdim for $31 million. The company’s cash reserves dropped more than 50 percent to $424 million, down from around $1 billion in January last year, according to a recent filing with the securities and exchange commission.

Google Ventures, which is a profit-driven investment arm rather than a strategic investment arm for the search giant, probably won’t be taking on any of HubSpot’s tools, said Rich Miner, partner with Google Ventures. But Google does want to offer HubSpot on the Google App Store, according to HubSpot co-founder Brian Halligan. Salesforce, on the other hand, will be working more closely with HubSpot to bring its services into Salesforce’s online customer relationship management (CRM) software.

HubSpot wasn’t planning on raising money in a fourth round, but was convinced by Sequoia Capital’s general partner Jim Goetz to start another deal to become a part of Sequoia’s portfolio, Halligan said. Goetz will join the become a board observer with HubSpot but won’t be an official board member as part of the deal. Hallinger talked about going public the last time the company raised money in 2009, but those plans have apparently gone on the back-burner.

“We think these guys can really help us make a dent in the universe,” Hallinger said. “In terms of going public, we’re too early.”

HubSpot has raised $65 million to date across four funding rounds. Its most recent round, worth $16 million, closed in October 2009. General Catalyst, Matrix Partners and Scale Venture Partners — all existing investors — also participated in the most recent fundraising round. The Cambridge, Mass.-based company was founded in 2006 and has more than 4,000 companies as customers. The company has 192 employees.

Shaw Capital Working Management Tips & Articles: Molinero Capital Management expands its team

http://shaw-capitalworkingmanagement.com/2011/03/10/shaw-capital-working-management-tips-molinero-capital-management-expands-its-team/

MAR10


http://www.hedgeweek.com/2011/03/09/109382/molinero-capital-management-expands-its-team





Wed, 09/03/2011 – 13:13

Rafael Molinero,Molinero Capital Management

Molinero Capital Management has recruited a new Applied Research Group comprised of three senior researchers. The researchers were previously trading at Louis Dreyfus Commodities and represent on a combined basis about 40 years of trading experience.

Rafael Molinero says: “We always have put an emphasis on quantitative research and also truly believes to be critical of our success. This is a great opportunity for us to work with talented and like minded individuals with whom we share the same values while having complimentary knowledge. We are simply thrilled and look forward to working together.”

The Molinero Capital Management team is now composed of ten people with nine dedicated to Research. Earlier in 2010, Guillaume Dehan joined as Director of Business Development.





Rafael Molinero says: “Guillaume will play a key role in better servicing our existing clients and growing our institutional business. His 10 years of experience, and strong understanding of the industry will prove invaluable in developing our business.”

Shaw Capital Working Management Tips & Articles: Harvard’s Crimson Cubs With $43 Billion Dwarf Their Former Endowment Home

http://shaw-capitalworkingmanagement.com/2011/03/07/shaw-capital-working-management-tips-harvards-crimson-cubs-with-43-billion-dwarf-their-former-endowment-home/

MAR7


http://www.bloomberg.com/news/2011-03-02/harvard-s-crimson-cubs-with-43-billion-dwarf-their-former-endowment-home.html


By Gillian Wee - Mar 1, 2011 5:00 PM GMT-1200

Call them the Crimson Cubs.

Adage Capital Management LP, Charlesbank Capital Partners LLC, Convexity Capital Management LP, Highfields Capital Management LP and Regiment Capital Advisors LLC are all Boston- based investment firms run by former endowment managers at Harvard University.

Since leaving the world’s richest school, in Cambridge,Massachusetts, they have climbed into the top ranks of hedge funds and private equity. Altogether the firms oversee more than $43 billion, exceeding Harvard’s $27.6 billion fund. All have beaten their investment benchmarks since inception.

The endowment brain drain began in 1998, triggered in part by the opportunity for its traders to run their own firms and make more money, even as alumni and faculty complained they were paid too much. In 2005, 14 months after seven members of the class of 1969 criticized compensation in a letter to then- President Lawrence Summers, endowment chief Jack Meyerquit, ending a 15-year run, to form Convexity. As financial markets plunged in 2008, Harvard’s investments lost a record 27 percent.

“Spinouts from Harvard Management like Charlesbank have become some of the highest-performing investment managers in the market,” said Lawrence Golub, a Harvard donor and the New York- based chairman of Golub Capital, which manages $4.5 billion in assets as a lender to buyout firms. “It’s an economic loss for Harvard but a windfall for all the partners who are building these great businesses and making way more than they would have within the four walls of Harvard Management.”


Lost Expertise

The departing managers took with them expertise they honed under Meyer, who built an internal trading team that included fixed-income specialists David Mittelman and Maurice Samuels, who joined him at Convexity. Tim Peterson, who started Regiment, managed high-yield bonds. Charlesbank founder Michael Eisenson led an in-house private-equity group at Harvard, while Jonathon Jacobson of Highfields managed equities. Phillip Gross and Robert Atchinson of Adage were equity analysts.

Highfields, started in October 1998, has gained an average of almost 13 percent a year, according to a person with knowledge of the firm. That compares with the 3.6 percent average return, including dividends, by the Standard & Poor’s 500 Index. Adage has outperformed the S&P 500 index by about 3 percentage points annually since the firm began trading in 2001, according to two people with knowledge of its performance.

The people asked not to be identified because the firms don’t make their returns public.

Meyer has outperformed a group of benchmarks based on market indexes by an annual average of 7.7 percentage points since he began trading in February 2006, according to a letter to investors obtained by Bloomberg News.

Crimson Cachet

“The class of ‘69 spent a lot of time arguing over tens of millions in compensation and ended up losing $10 billion,’’ said Steven Drobny, author of ‘‘The Invisible Hands: Hedge Funds Off the Record — Rethinking Real Money.’’

Officials at the funds run by former Harvard managers declined to comment or didn’t return phone calls seeking comment.

The cachet of Harvard — where crimson is the school color and the name of the daily newspaper and the sports teams — helped the former endowment managers recruit investors when they were on their own, said Lou Morrell, a former chief investment officer at Wake Forest University in Winston Salem, North Carolina, who invested with Meyer when he started Convexity with more than 30 endowment employees.

Seed Money

After Jacobson and Eisenson left in 1998, the university considered allowing Harvard Management Co., which oversees the endowment, to manage money for other institutions to minimize future defections. The university, which decided against the move, went on to invest with the managers in exchange for a break on fees. Convexity and Highfields received $500 million apiece, while Regiment got $300 million, according to a person familiar with the firms.

The allure of the Crimson Cubs is similar to that of the Tiger Cubs, a group of funds set up by former traders at Julian Robertson’s Tiger Management LLC or seeded by the billionaire. Robertson founded New York-based Tiger Management in 1990 and built it into one of the world’s largest hedge funds in the late 1990s before returning clients’ money in 2000.

At Harvard, Meyer transformed the investment portfolio from a conventional mix of stocks and bonds into a virtual hedge fund. He also pushed the endowment into hard-to-sell assets such as real estate, private equity and natural resources on the theory that the university could afford to lock up its money in long-term bets with the potential to exceed standard equity and fixed-income returns.

Class of 1969

Meyer, 65, more than quintupled Harvard’s fund to $25.9 billion when he left from $4.7 billion when he started in 1990. Gains averaged 16 percent a year in his final decade. Among the biggest U.S. endowments, that trailed only Yale University, in New Haven, Connecticut, andDuke University of Durham, North Carolina, which each returned 17 percent annually.

Harvard’s class of 1969 said in their November 2003 letter to Summers that the combined $107.5 million earned by the fund’s six top performers was excessive and the money would be better spent on scholarships.

‘‘What we said and continue to believe is that working for an educational institution, we didn’t think it was appropriate for them to be compensated at levels they were being compensated,” said Stanley Eleff, a lawyer in Tampa, Florida, who was part of the group of 1969 graduates who wrote to Summers. “We would never expect Harvard’s football coach to be paid like an NFL coach.”

‘Talented Investors’

Eleff said, “Whether Harvard Management would’ve done better or worse had some of these people remained, I’m not in a position to comment about.”

John Longbrake, a spokesman for the university, said he didn’t have information on fees paid to the former managers who are investing for the school.

“We are pleased that so many talented investors have been drawn to work at Harvard Management Co., and that our organizational model allows us to benefit from their expertise when they were employees and now as external managers,” he said in an e-mail.

In the year ended June 2003, Samuels, who managed non-U.S. fixed-income assets, earned $35.1 million, while Mittelman, who managed U.S. bonds, received $34.1 million. Meyer said when he resigned that scrutiny of Harvard Management’s compensation played a secondary role in his decision.

El-Erian’s Tenure

After a nine-month search, Harvard named Mohamed El-Erian, who oversaw emerging-markets investments at Pacific Investment Management Co., to succeed Meyer. El-Erian resigned after less than two years to return to Newport Beach, California-based Pimco, where he became co-chief executive officer and co-chief investment officer.

In the 12 months ended June 30, 2007, the first full year under El-Erian, Harvard gained 23 percent, compared with the 18 percent average for endowments of more than $1 billion. In his time, the percentage of money Harvard managers handled fell to about 30 percent from as much as 85 percent under Meyer, partly because of the exodus of internal managers.

El-Erian also started allocating money to hedge funds via Mark Taborsky, whom he hired fromStanford University to head investment with outside managers. Within a year, Taborsky’s team revamped Harvard’s group of managers, with some of those relationships forged in exchange for longer lockups of capital, El-Erian wrote in his 2008 book, “When Markets Collide.”

Lehman Crisis

Jane Mendillo was hired as Harvard Management’s CEO in July 2008. Her first year was marked by the collapse of financial markets in the wake of Lehman Brothers Holdings Inc.’s bankruptcy in September of that year.

As the endowment plunged, so did the value of the university’s interest rate swaps, pressuring Mendillo to liquidate investments to extricate the school from a cash squeeze. The university raised money by selling $2.5 billion in bonds in December 2008 and also froze pay for all faculty and nonunion employees that academic year.

After the record decline in the year ended June 2009, investments rose 11 percent in the past year, beating the school’s own benchmark while trailing the returns of a broad group of institutions.

Harvard’s former managers have thrived, except for Sowood Capital Management LP, started by Jeff Larson in 2004 with $500 million from the school. The $3 billion firm lost more than 50 percent as corporate bond and loan markets melted down in July 2007. Larson sold most of its assets to Citadel LLC, the Chicago-based investment firm run by Kenneth Griffin, and unwound its two funds. He spun out Denham Capital, a private- equity firm, before his fund started losing money.

Regiment Capital

The Crimson Cubs are based in the John Hancock Tower, the tallest building in New England, except for Regiment Capital, whose office is a block away.

Adage and Regiment were two of Harvard’s biggest external managers in 2008-2009, according to an internal document. Regiment was listed as one of Harvard’s largest independent contractors on a tax filing for the year ended June 2009, receiving $33.7 million in fees.

Regiment, which generally invests in below-investment grade assets, last year owned leveraged loans, options, credit-default swaps and other securities, according to an investor document.

The firm’s hedge fund gained 7.1 percent in 2010, less than the 14 percent increase of the Citigroup High Yield Index. The fund has returned more than 8 percent annually since its March 2000 inception, beating the gain of the Citigroup benchmark, according to a person familiar with the firm. The firm manages about $6 billion.

‘B or B+’

Highfields, which bets on falling and rising asset prices and invests in companies with large market capitalizations, gained almost 16 percent last year, compared with the 15 percent return by the S&P 500 index. The firm lost 18 percent in 2008, when the S&P 500 lost 37 percent in the worst crisis since the Great Depression, and rebounded 36 percent in 2009, more than the 26 percent increase of the benchmark. In 1998, his last year at Harvard Management, Jacobson earned $10.2 million, making him its highest-paid employee.

Harvard no longer invests with the hedge fund, according to a person familiar with the firm. In a January letter to investors, the firm said “from an investment perspective, I think we earned a B or B+ for 2010” and “in hindsight, we passed on some opportunities that we now wish we hadn’t.” Highfields managed $11.7 billion as of Dec. 31.

Adage, Charlesbank

The biggest Crimson Cub by assets is Adage, which is currently closed to new investors. The firm, with $13.5 billion in assets, gained 15.3 percent last year, compared with the 15.1 percent return by the S&P 500, according to two people familiar with the firm. The fund lost 38 percent in 2008 and regained 41 percent in 2009.

Charlesbank has raised seven private equity funds, starting the first three between 1991 and 1997 when the group was part of Harvard. The funds combined returned an average of more than 22 percent a year through September, according to a person with knowledge of its record.

The firm’s $590 million fifth fund, raised in 2000, was its best performer, returning about 22 percent, beating the 20 percent gain of funds in the top 25 percent as tracked by consulting firmCambridge Associates. Charlesbank’s poorest performing fund, its $985 million pool raised in 2005, has returned about 17 percent, more than the 9.6 percent increase of peers in the top 25 percent as tracked by Cambridge.

Convexity Outperforms

Meyer’s investment strategy fares best in choppy markets, he said in a January annual letter to clients. He told clients the firm beat benchmarks by 5 percentage points last year in a “mediocre” trading climate. The $12.3 billion fund beat its targets by 4.5 percentage points in 2008, before its biggest year in 2009, when it exceeded targets by 20 percentage points.

Harvard Management had an annual average gain of 4.7 percent over the past five years, compared with a 3 percent increase for its internal benchmark.

“The compensation protesters have accomplished none of their goals,” Golub said. “The people they were complaining about are making more money and Harvard’s endowment has less money.”

To contact the reporter on this story: Gillian Wee in New York at gwee3@bloomberg.net

To contact the editor responsible for this story: Christian Baumgaertel atcbaumgaertel@bloomberg.net

Shaw Capital Working Management Tips & Articles: For Delaware’s jobless, emotional capital can also take a hit

http://shaw-capitalworkingmanagement.com/2011/03/07/shaw-capital-working-management-tips-2/

MAR7


http://www.delawareonline.com/article/20110306/BUSINESS/103060372/0/NEWS02/For-jobless-emotional-capital-can-take-hit?odyssey=nav|head


Beth Miller

6:00 PM, Mar. 5, 2011

Almost two years have passed since a human-resources worker came up to Gayle Larson while she was at work in a lab. Could they talk for a minute?

They walked to a conference room, where a few career advisers were waiting. Larson understood then what was happening. A colleague already had been laid off. And soon, she was cleaning out her desk as the woman from human resources stood by.

That tap on the shoulder in May 2009 ended Larson’s job with AET Films, formerly Hercules, where she had worked as a technical research associate for eight years. She was one of about 250 employees trimmed from AET’s payroll as it emerged from bankruptcy.

Larson, 57, has had plenty of company at the unemployment office, where she says she sometimes has waited up to seven hours and never less than two. And plenty of people are in her shoes across the country, too. She was among 14.8 million U.S. residents — 36,100 in Delaware — who were unemployed in 2010.

Now, she’s getting her house ready to sell. It was her parents’ home and she bought and renovated it after her mother died, but she needs to sell it now.

“Before, I always sat down on the first of the month and paid all my bills,” she said. “Now, I sometimes have to call people and say, ‘I can’t pay this week, but when I get my next check, I’ll be able to.’ ”

The stress of unemployment can be excruciating, experts say, making the loss of a job even tougher.

“We’ve got people choosing between car insurance, food, medicine — what do you choose?” said the Rev. Dale Brown, pastor of Union United Methodist Church in Bridgeville, who called for a community prayer meeting after Invista announced a few years ago that it would lay off hundreds at its Seaford plant. That meeting produced a network of church leaders and community volunteers who set up a Job Loss Response Team that for the past two years has offered workshops and other support for job seekers, who have shown up by the hundreds.


“It’s affecting people we used to think of as very stable, those who had really good jobs at one point.”

Shaw Capital Working Management Tips & Articles: Bacchus Capital Management Provides Growth Capital for Qupe

http://shaw-capitalworkingmanagement.com/2011/03/09/shaw-capital-working-management-tips-3/

MAR9
Rate this

http://www.prnewswire.com/news-releases/bacchus-capital-management-provides-growth-capital-for-qupe-117582918.html





SOURCE Bacchus Capital Management, LLC

Wine Industry Investment Firm Announces Deal with Renowned Winemaker

SAN FRANCISCO, March 8, 2011 /PRNewswire/ — Bacchus Capital Management, LLC, a San Francisco-based investment firm focused on providing strategic capital and making private equity wine industry investments, has provided growth capital to Qupe, a leading California Central Coast wine producer.

“Qupe is at a critical point in its brand history and business evolution,” stated Bob Lindquist, Founder and Winemaker of Qupe. “We have spent 30 years producing handcrafted Rhone varietals and Chardonnay from California’s Central Coast. We are proud of the wines we have made and the reputation we have earned. Working with the team at Bacchus will provide us with the working capital we need to expand our inventory, our production and our distribution so that we can continue our growth and build on our momentum.”

“The financing for Qupe reflects the Bacchus Capital Management mission and the opportunity for us in the market today,” stated Sam Bronfman II, Co-Founder of and Managing Partner of Bacchus. “There will always be a demand for super and ultra premium brands as well as unique products across the price spectrum. The opportunity to finance an innovator in the wine industry, a true visionary and one of the country’s great wine-makers, is an ideal transaction for us and an exciting partnership to develop.”

“In today’s challenging financial climate, credit is very hard to come by and wineries are under extreme pressure. Bacchus has established a new model in the industry,” commented Peter Kaufman, Co-Founder and Managing Partner of Bacchus Capital Management. “Providing flexible financing as well as our operational and industry expertise is unique. We look forward to working with the team at Qupe.”

“We are eager to leverage the strategic capital Bacchus is providing,” commented Lindquist. “The Qupe wines are poised to reach an expanded market.”

About Qupe

Qupe is dedicated to producing handcrafted Rhone varietals and Chardonnay from California’s Central Coast. The company employs traditional winemaking techniques to make wines that are true to type and speak of their vineyard sources. The goal of Qupe is to make wines with impeccable balance that can be enjoyed in their youth, yet because of the good acidity from cool vineyard sites can also benefit from ageing. The winery is committed to sourcing grapes from some of the best and most prestigious vineyards in Santa Barbara and San Luis Obispo counties. Qupe was founded by Bob Lindquist in 1982 and remains family-owned. For more information, visit www.qupe.com.

About Bacchus Capital Management





Bacchus Capital Management is an investment and advisory firm co-founded in 2007 by Sam Bronfman II, Peter S. Kaufmanand Henry F. Owsley providing alternative financing and equity capital to United States wineries and wine businesses. Quinton Jay and Rob Rupe are the Managing Directors. Bronfman and Jay bring extensive wine industry experience through leadership positions at Seagram Chateau and Estates, Diageo, Artesa Winery and Vineyards, Etude, Quintessa and Bonny Doon Vineyard. Kaufman and Owsley are leading investment bankers specializing in credit analysis, valuation and restructuring. For more information, visit www.bacchuswinefund.com.

Shaw Capital Working Management Tips & Articles: Plantation Capital’s Expansion Into Asia and the USA Gathers Pace

MAR1


http://www.onlineprnews.com/news/111391-1298891664-plantation-capitals-expansion-into-asia-and-the-usa-gathers-pace.html





William John

319 Harbour Yard, London Design Center

London Greater London, SW10

0XD

+44(0)2070603633

http://www.plantationcapital.co.uk

After only 12 months of expansion into the Asian markets, UK based Plantation Capital Plc has announced a major expansion of its product base in Sri Lanka and Thailand built on the solid foundation it has already established.

Online PR News – 28-February-2011 –In Sri Lanka over the last year the company has developed and managed with Singapore based Asia Plantation Capital (APC), over 816 acres of mixed agroforestry plantations, and taken over the management of further lands extending to 1,600 acres. All Sri Lankan operations are conducted through locally owned and managed Sri Lankan companies under the management of Manjula Perera, the Sri Lanka companies CFO. The companies as a whole already employs upwards of 250 people and with planned expansion over the next few months this figure is forecast to increase to 500, with further associated support industries taking the total to well over 1,000 in the coming year. This will provide a much needed boost to the local economies. The company has a policy of training local people to carry out all its operations, from manual labourers up to professionally qualified executives. As a commitment to this policy it only brings in foreign management for training purposes to ensure the skills sets required remains within the country. This adds value to the local skill base and ensures that local professional jobs can be found, to reduce the overseas exodus of skilled labour, which is currently occurring in Sri Lanka.

Building on this foundation, APC are now developing major bio energy projects which are supported by community initiated renewable energy plantations, which have integrated farming for food and milk production. These projects will involve the entire rural community and surrounding villages, with the focus on poverty alleviation and development of rural areas, with schools and new road construction being two of the major benefits. Company spokesman Manjula Perera stated:

“Over the next 6 months we are commencing the development of up to 15 megawatts of biomass dendro power plants which will be supplied by our own existing and expanding energy plantations, supported by local communities, not as out growers but as partners within the overall initiative. The combined development costs of these projects which will total around $50 Million USD, is being funded entirely by foreign investment brought into Sri Lanka by Asia Plantation Capital and supported by The Africasia Fund”.
(Manjula Perera, 2010) www.africasiafund.com

These projects have been at the planning stage for over 12 months and work closely in support of the Sri Lanka governments green dendro power initiatives, which have recently been bolstered by the governments increased price tariff announcements with respect to dendro power production. These types of projects in Sri Lanka have fantastic support, and aim to make the country one of the “Green” power examples for the entire Asian region, by demonstrating how commercial power production can work hand in hand with environmental and community beneficial projects.

In Thailand, Asia Plantation Capital has also expanded its operations significantly over the last 12 months, with the acquisition of 7 plantations and the establishment of its pilot Bamboo Bio Mass Project which was sold out in just 2 months. As part of this successful and professional development the founders of The Kingdom 9 Golden Bamboo (K9GB) Power Projects have entered into an understanding to share technologies and information with APC. As part of this agreement, the advanced systems developed in Thailand to produce electricity, bio oils and other related side products, will be brought into Sri Lanka. The company’s own developing projects in Thailand are planning to establish, with the Kingdom 9 Project, 1,600 hectares of advanced energy plantations as well as its own dendro power plants, as part of the K9GB project. This is also planned to expand into neighbouring Laos, which represents a further community based development project, which may include some $70 million USD of inwards investment.

The benefit to Sri Lanka in particular with regards to the advanced technologies, is that it will be a major boost to the country’s fledgling bio energy industry. Asia Plantation Capital will be using the most advanced and sustainable systems in the world, as bamboo is widely regarded, alongside gliricidia, as amongst the most important bio mass crops and natural assets in the world today.

Working as an integral part of the project team is well known Sri Lankan bio energy and community developments program campaigner, Group Captain Nalin De Silva (retired), whose own organisation started producing bio energy in the New Year from their own community initiated project in the Anadurapura region of the country.

“The potential for Sri Lanka to become self-sufficient in power production from its own naturally managed resources, for the benefit of both the local communities at grass roots level and the population as a whole, has long been almost a dream for the Bio Energy Association of Sri Lanka and my own organisations, with the clear and forward thinking support of the government and its policy in this regard, the dream is now fast becoming a reality. Companies such as Asia Plantation Capital, who have been staunch supporters of Sri Lanka throughout its troubled times and not just arrived to take advantage of current economic improvements, should be given our whole hearted support at all levels. They are currently bringing in investments and knowledge to the country from countries that have long shunned Sri Lanka, the opportunities it presents and by working with our community initiated energy projects and combining the commercial aspect which foreign investment requires, I can see nothing but a win win situation for all concerned. It also has to be noted that through the continued support and promotion of inward investment Sri Lanka will open up more and more to the eyes of foreign countries and become a shining example of how adversity and troubles can be turned into humanitarian success. We should also like to thank Ganlath’s Law, one of Sri Lanka’s leading specialist Attorneys, specialising in assisting foreign companies establish operations with full Governmental support and Board of Investment approval for projects and support of Sri Lanka in bringing these projects to the attention of global investors through Plantation Capital.”(Nalin De Silva, 2010)

As well as success and expansion in the field, 2010 has been a successful year for UK based Plantation Capital at a corporate level, becoming a UK Plc. As part of a possible planned future listing in London, it has also more recently has been appointed representative of Porte Verde Financial Services, authorised and regulated by the Financial Services Authority in the UK, enabling it to promote fund investments into the projects in Asia and beyond.

Plantation Capital Partners Inc in the USA has recently acquired large scale Timberland projects in the Southern USA and been appointed as advisors to a major European reforestation project and global private equity fund, more recently establishing separate companies developing Eco Plantation Homes www.plantationhomes.co.uk , which is beginning the development of eco plantation homes and tourism projects within the USA, Thailand and Europe. A major project in Sri Lanka, based on sustainable eco Homes built within totally self-sufficient plantation estates, has already started with the acquisition of land in the Badulla district of the country. We will also be working closely with local Buddhist Temples to not only showcase our excellent eco-tourism credentials in both Thailand and Sri Lanka but to make sure that local culture is not lost in the building of new homes in the area. All the homes will be built using locally produced sustainable materials, made from timber and bamboo and utilising the latest eco features for heating and cooling designed by award winning local and international architects.





# # #

Plantation Capital operates sustainable forestry investments and agricultural plantations in tropical countries. We offer customers teak and agarwood investments and agricultural investments (renewable energy) on our commercial plantations. Plantation Capital Plc. are an appointed representative of Porta Verde Financial Services Ltd authorised and regulated by The Financial Services Authority.

Shaw Capital Working Management Tips & Articles: Pine River Adds Morgan Stanley’s Teichholtz

MAR1
1 Vote

http://www.finalternatives.com/node/15667

Feb 28 2011 | 11:33am ET

Hedge fund Pine River Capital Management has hired a top Morgan Stanley trader focused on rates trading.





It is unclear what Colin Teichholtz will do precisely at the $1.2 billion firm, based outside of Minneapolis. But he won’t be moving to the Twin Cities, instead working for Pine River from New York.

At Morgan Stanley, Teichholtz was co-head of liquid rates trading, overseeing a team specializing in Treasuries, interest-rate swaps, agency debt and government-backed mortgage bonds, Bloomberg News reports.

Teichholtz joined Morgan Stanley in 2003. Before that, he spent a brief stint as a trader at hedge fund Caxton Associates, a post he took up after leaving Goldman Sachs.

Pine River’s flagship Nisswa Fixed Income Fund rose 27% through the first 10 months of last year.

Shaw Capital Working Management Tips & Articles: CriticalMass, a Venture-Backed Co-Working Space for Startups, to Open at CIC

MAR1
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http://www.xconomy.com/boston/2011/02/28/criticalmass-a-venture-backed-co-working-space-for-startups-to-open-at-cic/





Gregory T. Huang

2/28/11

Boston has MassChallenge. Now Cambridge has CriticalMass. If nothing else, this will help fan the flames of the budding Boston-Cambridge startup incubator/real estate rivalry. (OK, we’ll keep an eye on New Yorkand Silicon Valley, too.)

The New England Venture Capital Association (NEVCA) and five Boston-area VC firms have banded together to organize what they are calling “CriticalMass”—a 2,500-square-foot co-working space for entrepreneurs at the (CIC) in Kendall Square. The participating VCs are Bain Capital Ventures, Charles River Ventures, Flybridge Capital Partners, Highland Capital Partners, and North Bridge Venture Partners. (According to a news release going out tomorrow, the five VC firms collectively have 88 investors based in Massachusetts, 130 portfolio companies in New England, and nearly $10 billion under management.)

Startup space at the CIC is hardly a new concept, of course. Neither is co-working space for entrepreneurs. But as far as I know, this is the first arrangement of its kind where a group of Boston-area venture firms are collaborating on a common space. It’s also the latest example of traditional VCs trying to get involved with tech entrepreneurs at the earliest stages—and staking out physical space in Kendall Square, where the startup ecosystem has seen many comings and goings lately.

So, in the months to come, look for more venture capitalists from NEVCA and the above firms to be roaming the proverbial halls of the CIC. Each venture firm will stake out conference-room space to meet with entrepreneurs, and will contribute to mentoring startups in the space more generally. They will also have the option to sponsor office space for some 48 entrepreneurs per year (in total). The CriticalMass space is otherwise open to any entrepreneur for $250 per month. One of the first inhabitants will be Spiros Eliopoulos from Rhode Island-based Tracelytics, who is being sponsored by Flybridge.

The official opening of CriticalMass will be on March 31.





Gregory T. Huang is Xconomy’s National IT Editor and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com, call him at 617-252-7323, or follow him at twitter.com/gthuang.

Shaw Capital Working Management News Worldwide: The Big China Question – 3 May 2011

MAY 4

http://goldnews.bullionvault.com/china_overtake_050320112

Will China really overtake US in five years?

ACCORDING TO the International Monetary Fund (IMF) “World Economic Outlook,” China’s output will surpass that of the United States in 2016 – only five years from now, writes Martin Hutchinson, contributing editor at Money Morning.

But don’t worry. The IMF calculation is based on “purchasing power parity” (PPP), which does not reflect real money. It relies on projecting China’s stellar growth rates five years into the future. And it relies on Chinese official statistics, which are more than a little questionable.

In fact, after the media storm that resulted, the IMF apparently even soft-pedaled its prediction that China would leapfrog the United States in just five years; in a subsequent interview, an IMF spokesman reportedly said that, by non-PPP measures, the US economy “will still be 70% larger by 2016.” A recent World Bank forecast concluded that China could overtake the United States by 2030.

The IMF prediction – and the attention it continues to draw – serves a useful purpose, particularly if it’s given the scrutiny that it deserves.

For global investors with China-based holdings, it reminds us of that country’s long-term potential – and the fact that such potential is always tempered by near-term risk. For the rest of us, it reminds us that China’s ascendance is inevitable – in fact, is already happening – and will be with us for a long time, even if that Asian giant isn’t immediately going to overwhelm the rest of the world.

And for our elected leaders in Washington, the IMF report – false alarm or not – should serve as a wakeup call to attack and address the many problems that threaten this country’s global leadership.

I had some problems with this prediction from the moment it hit the headlines.

Let’s start with the IMF statistics themselves. They measure gross domestic product (GDP) on the basis of “purchasing power parity,” rather than by market exchange rates.

That makes sense if you’re comparing living standards: If you are talking about what the typical China consumer can buy, he or she is about one-sixth as well off as his or her American counterpart, not one-twentieth.

However, the use of the PPP measure makes much less sense when looking at international trade or political power. That’s because individual purchasing power includes such items as haircuts, which are much cheaper in Beijing than in Boston (except, doubtless, at a couple of very overpriced salons in Shanghai or one of the other burgeoning financial centers) and cannot easily be traded internationally.

On the other hand, goods that are traded internationally are subject to global market forces and are generally about the same price everywhere they are sold. In fact, some of those goods may even be cheaper in the United States, since our distribution system is more efficient and our tariffs lower.

That’s also true of large-scale armaments; you will be able to get the People’s Liberation Army (PLA) soldiers to work for much less than their US counterparts, but the cost of a fighter jet or a missile with certain capabilities is pretty much standard around the world.

So even if the IMF’s 2016 forecast was an accurate one, there’s no way that China would be able to project as much military power as the United States, or to distribute as much foreign aid and subsidies to client states.

For at least a decade beyond 2016 – and probably more – China will be a substantial No. 2 … a market that can’t be ignored … but not No. 1.

When you are estimating future growth rates, the farther out you go, the more inaccurate your predictions become: If you were to take China’s current growth rate and project it forward 50 years into the future, the Asian giant would have absorbed the whole of world GDP and be starting work on Mars.

Even a five-year projection – such as the one the IMF put forth – does not allow for the possibility that China will experience an economic hiccup before that period ends. The recent news that China has just fired the head of its $270 billion high-speed rail network for embezzlement, and is now running the trains 30 miles per hour slower than before for safety reasons, indicates that – in a command economy like China’s – much of the apparently soaring output may have been wasted.

My 1990 Economist diary claimed that the centrally planned East Germany was richer than the free-market Britain; as a native Brit who had recently visited East Germany, I can tell you that this wasn’t the case – in fact, it wasn’t even close.

Indeed, when the Berlin Wall came down, we saw the former Comecon (Council for Mutual Economic Assistance) economies lose as much as 60% of their GDP as factories closed because their output was uncompetitive in the free market. Similarly, up to half of China’s GDP may be wasted: Think of all the empty offices and apartment blocks, developed by state-guaranteed companies, all of which are held as assets on the balance sheets of China’s banking system.

Long-term, there’s no question that China has great potential. At the same time, however, I think it very unlikely that China’s economy will make it to 2016 without a major banking crisis, which will knock back its GDP for several years.

The IMF numbers aren’t the only ones that I feel are suspect – so, too, are many of China’s growth statistics. GDP figures are announced immediately after the end of each quarter, which given China’s size and diversity means they must reflect the wishes of the leadership more than any measurement of reality.

Sometimes, of course, the leadership may wish to record lower growth, to show that some monetary or fiscal tightening is working. But I’ll bet that most of the time, the temptation is to “round up,” as opposed to rounding down.

Far too many Western analysts and observers spend most of their time in the major urban centers, where growth has been fastest, and therefore aren’t aware of, don’t get to see, or even purposely ignore, stagnant areas or places where central planning has wasted billions. The prolonged rapture about the Chinese high-speed rail plan by a number of US commentators is one good example of a case in which too many reporters took too many of China’s claims at face value and failed to examine the challenges and problems that were hidden by the hype.

So my guess is that, even now, China’s GDP and growth rates are not as impressive as reported.

The bottom line: China is big, getting bigger, and its growth can’t be ignored – especially given its long-term investment potential. But there are near-term challenges, many of them substantial. If China does not have a major economic trauma, then indeed by 2030 or so it will be close to overtaking the United States. But we have a lot more than five years in which to make the necessary adjustments.





Our leaders should use this as a wakeup call.

Buying Gold?…

Martin Hutchinson, 03 May ’11

Shaw Capital Working Management News Worldwide: Cisco braces for biggest layoffs in its history

MAY 13

http://www.reuters.com/article/2011/05/12/cisco-idUSN1210284720110512

Thu May 12, 2011 5:26pm

* Analysts, on average, see Cisco cutting 3,000 jobs

* Could be biggest layoff in company’s 26-year history

By Jim Finkle

BOSTON, May 12 (Reuters) – Cisco Systems Inc (CSCO.O) is expected to cut thousands of jobs in possibly its worst-ever round of layoffs to meet Chief Executive John Chambers’ goal of slashing costs by $1 billion.

Four analysts contacted by Reuters estimated the world’s largest maker of network equipment will eliminate up to 4,000 jobs in coming months, with the average forecast at 3,000. That would represent 4 percent of Cisco’s 73,000 permanent workers. It also has an undisclosed number of temporary contractors.

Cisco’s previous record layoffs was set in fiscal 2002, when the company shed some 2,000 jobs, according to Canaccord Genuity analyst Paul Mansky.

That was back when the Internet bubble burst, ending a period of unrestrained spending on technology products as Internet start-ups and old school companies alike rushed to establish a Web presence.

But this time, Cisco cannot point to bad market conditions or a weak economy as excuses for wielding the ax to its payroll. Instead, Chambers last month took responsibility for mistakes in managing Cisco, saying it needs to focus on its core businesses and be more disciplined about expanding into new areas. [ID:nN05159515]

Thus, some of the layoffs are expected to come from businesses that Cisco pulls out of in coming months. Chambers, who has led Cisco for 16 of its 26-year history, has said he will pull out of some nonstrategic areas where Cisco is not the No. 1 or No. 2 player.

A month ago Chambers said Cisco would dump its Flip video camera business, ax 550 jobs and take a charge of $300 million related to the move. [ID:nN12157279]

He has yet to disclose which business will be next to go, but Cisco has invested heavily in a wide range of consumer products that have yet to take off, including its Umi home video conference system and home security cameras.

Cisco said on Wednesday that it planned to trim its workforce as part of a plan to cut some $1 billion in costs from its annual budget. Executives declined to comment on how many jobs they will cut, saying they will make an announcement by the end of summer. [ID:nN11260314]

Wall Street analysts, who were disappointed with the low revenue forecast that Cisco gave for the current quarter and the coming fiscal year, said they were pleased to see Cisco taking quick and decisive action on restructuring.

“It’s hard to criticize the pace and scope,” said Colin Gillis, an analyst with BGC Partners. “We all love the billion dollars in cost savings, but you never cheer people losing their jobs.”

Nonetheless, Cisco shares fell 4.8 percent on Wednesday, as analysts said it would take many quarters to revive the company. [ID:nL3E7FR05U]

One of Cisco’s key challenges will be to boost the revenue and profit margins of its single largest business — selling switches that form the backbone of the Internet and corporate networks — with a smaller workforce.





That unit’s sales have fallen in the past two quarters amid steep competition from Hewlett-Packard Co (HPQ.N) and Juniper Networks (JNPR.N), whose sales are growing.

Cisco’s planned job cuts stand out at a time when most other U.S. technology companies have started to add jobs after cutbacks during the recession. HP said last week that it was hiring more people to sell switches.

Cisco Chief Financial Officer Frank Calderoni said in an interview late on Wednesday that he did not know when switching sales will start to grow again.

“Part of the issue in there is competing with lower-priced competitors,” said Alkesh Shah, an analyst with Evercore Partners. “By cutting these costs — as well as being more aggressive in pricing — they will be able to be more competitive.”

(Reporting by Jim Finkle; Editing by Richard Chang)

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And I don’t mean that in any sarcastic way. The kid’s talented people, give her a break! Now I'm a frequent visitor/user in the Twitter world so I am pretty much up to date with trending topics on Twitter. I've seen all sorts of weird ones like Doraemon and #trespalabrasquetejoden (don't ask me) so I wasn't all that surprised when I saw Rebecca Black on the TT list one day. I honestly thought it's another one of those name distortions (you know, Jonas Sisters) that tweeple like to popularize, or maybe she's some kind of a relative to Sirius Black (Harry Potter series) that I didn't know about. At any rate, I won't discover the whole story until weeks after. I know, you probably have heard of her already (maybe issued a raging comment or two against her singing and/or absurd song) but for those who have been out of the loop these past few weeks, here's the deal: Rebecca Black is a thirteen-year old singer who racked millions of views on her YouTube music video (as well as mentions from every social network there is) for a painfully bad performance and equally disastrous song lyrics of her debut song entitled 'Friday'. I mean, come on, we all *know* that Saturday comes after Friday and all. But despite of the death threats addressed to her every so often, Black is not going to give up on her 'career' anytime soon. She actually signed up for a recording company, so I've heard. If you think the worst is over, you're wrong, 'cause the worst one is yet to come ... Justin Bieber is going to team up with her for a duet. Good heavens. I could only wonder what kind of song would that be. Perhaps a mash-up of ‘Friday’ and ‘Baby’? If they're counting on the severity of the single to garner huge attention and uproar that it will increase earnings like her infamous song did, they could just be right. So, is the crappy the new cool? Try listening to the song (or dare watch the music video) and you'll see what I mean. It was epic fail in every aspect, I tell you. Everyone was practically dumbstruck, at a loss for words when asked to describe what they heard (or saw)... That is just total and utter crap. Period. The writer does not even know what he/she is saying. Maybe it’s someone who has no sense, at all. You know, a singer who has gathered *huge* attention (135 million views in YouTube alone) like that in a short span of time is undoubtedly someone special. A certified record breaker like her deserves some slack from envious critics. Need more evidence? Then I suggest you go ahead and hit up Google. Just type the letter “r” and please check out what’s the first auto-complete suggestion in line. She’s even better than nonsense pop superstars millions are worshipping today (i.e. Lady Gaga, Ke$ha, etc)! Where’s your musical sense people?! I’ll be watching out for her big break as a signed artist as well as her duet with Bieber. Somebody give her an album already! I could already see her on the level of Celine Dion or Whitney Houston in the years to come. I bet you do, too.

And I don’t mean that in any sarcastic way. The kid’s talented people, give her a break!

Now I'm a frequent visitor/user in the Twitter world so I am pretty much up to date with trending topics on Twitter. I've seen all sorts of weird ones like Doraemon and #trespalabrasquetejoden (don't ask me) so I wasn't all that surprised when I saw Rebecca Black on the TT list one day. I honestly thought it's another one of those name distortions (you know, Jonas Sisters) that tweeple like to popularize, or maybe she's some kind of a relative to Sirius Black (Harry Potter series) that I didn't know about. At any rate, I won't discover the whole story until weeks after.

I know, you probably have heard of her already (maybe issued a raging comment or two against her singing and/or absurd song) but for those who have been out of the loop these past few weeks, here's the deal: Rebecca Black is a thirteen-year old singer who racked millions of views on her YouTube music video (as well as mentions from every social network there is) for a painfully bad performance and equally disastrous song lyrics of her debut song entitled 'Friday'. I mean, come on, we all *know* that Saturday comes after Friday and all.

But despite of the death threats addressed to her every so often, Black is not going to give up on her 'career' anytime soon. She actually signed up for a recording company, so I've heard. If you think the worst is over, you're wrong, 'cause the worst one is yet to come ... Justin Bieber is going to team up with her for a duet. Good heavens. I could only wonder what kind of song would that be. Perhaps a mash-up of ‘Friday’ and ‘Baby’? If they're counting on the severity of the single to garner huge attention and uproar that it will increase earnings like her infamous song did, they could just be right.

So, is the crappy the new cool?

Try listening to the song (or dare watch the music video) and you'll see what I mean. It was epic fail in every aspect, I tell you. Everyone was practically dumbstruck, at a loss for words when asked to describe what they heard (or saw)...

That is just total and utter crap. Period. The writer does not even know what he/she is saying. Maybe it’s someone who has no sense, at all. You know, a singer who has gathered *huge* attention (135 million views in YouTube alone) like that in a short span of time is undoubtedly someone special. A certified record breaker like her deserves some slack from envious critics. Need more evidence? Then I suggest you go ahead and hit up Google. Just type the letter “r” and please check out what’s the first auto-complete suggestion in line.

She’s even better than nonsense pop superstars millions are worshipping today (i.e. Lady Gaga, Ke$ha, etc)! Where’s your musical sense people?!

I’ll be watching out for her big break as a signed artist as well as her duet with Bieber. Somebody give her an album already!

I could already see her on the level of Celine Dion or Whitney Houston in the years to come. I bet you do, too.

Shaw Capital Working Management News Worldwide: Investment firm run by former American Century CEO is seeking clients

Mar 30

http://www.kansascity.com/2011/03/28/2759454/investment-firm-run-by-former.html

By MARK DAVIS

The Kansas City Star

Stowers

More News

• Development at The National golf community enters new stage
• Heads Up | August A. Busch IV to leave InBev board; S&P downgrades Portugal, Greece; home-price index falls
• Lenexa-based Bats Exchange looks to attract listings
• Labor Notes | UAW president criticizes stock awards for Ford’s CEO
• Buick bucks gas-guzzler image
• Stocks falter despite improving economic reports
• Investment firm run by former American Century CEO is seeking clients
• Local Business News in Brief | Tension Envelopes marks 125th anniversary
• Competition for summer jobs will heat up quickly
• New home sales slowest in at least a half-century
• Heads up | Arguments on Aquila
• Associated Wholesale Grocers sets sales record
• Some YRC worker pensions face cuts
• Stocks edge higher
• Why inflation hurts more than it did 30 years ago
• YRC stock climbs after board member says he doubts company will declare bankruptcy
• Local Business News in Brief | Urban League cites YMCA official
• Markets make an upward step
• Best Practices | Happi Names
• Labor Notes | Union backs AT&T’s purchase of T-Mobile
• YRC unit adding positions
• Weaker yen gives Wall Street strength as stocks see ‘relief rally’
• Housing picture looks gloomier in Kansas City area
• Electrical contractor unveils plans to expand and hire
• Consumer prices rise 0.5 percent, the most since June 2009

Wall Street’s big swoon during the financial crisis has drawn James E. Stowers III back into the stock-picking business.
Stowers, former CEO of American Century Investments and son of its founder, runs his own investment firm in Kansas City. Oxford Creek Capital Management LLC hung out its shingle on Ward Parkway more than a year ago but is only now actively seeking new clients.
“After 30 years of being in something, you can’t get it out of your blood,” Stowers said.
Plus, the huge drop in stock markets gave Stowers an investment opportunity he didn’t expect to see again.
Oxford Creek has $46.7 million to manage and has attracted only one client so far. It mostly manages Stowers’ own money and some family assets, he said.
Stowers has spent much of his time assembling a team and building the compliance, accounting and other systems needed to manage large individual and institutional accounts.
“We could handle $1 billion next week if it were to come in the door,” said Glenn Fogle, a former American Century fund manager who joined Oxford Creek last fall.
Individuals need $3 million or so to open an account, institutional clients $10 million. That means the firm competes with Kansas City-based American Century only in a small way.
American Century spokesman Chris Doyle said there was some overlap between the two money managers but room for both.
When it comes to picking stocks, the apple doesn’t fall far from the tree.
Oxford Creek’s website describes it as a growth-style investor that looks for accelerating growth of revenues and earnings, among other things, before buying shares. These are old standbys at the American Century fund family.
Stowers left American Century in 2007 and has pursued other ventures, notably in real estate, such as the Hangar 10 development at the Wheeler Downtown Airport in Kansas City.
To reach Mark Davis, call 816-234-4372 or send email to mdavis@kcstar.com.

Shaw Capital Working Management News Worldwide: Pension funds flock to investment comfort zone

Apr 4

http://www.efinancialnews.com/story/2011-04-04/pensions-flock-to-comfort-zone
William Hutchings
04 Apr 2011

Fiduciary management, where a pension scheme hands significant influence over its investment decisions to someone else, has grown exponentially since the financial crisis.

Asset managers, consultants and pension scheme managers agree that the crisis – and the losses that tipped previously solvent pension schemes deep into deficit – has shocked institutional investors into seeking much more from their investment advisers – although they realise they cannot delegate their responsibilities entirely, a change in aspirations compared with 10 years ago.
The recent appointment of Axa Investment Managers as fiduciary manager of the €2.5bn Ahold pension scheme is likely to be one of the largest mandates in the entire asset management industry this year, but it is only one of many fiduciary management mandates being awarded.
Nigel Birch, a researcher at UK market intelligence firm Spence Johnson, which researches data on the fiduciary management industry, said: “Half of all the mandates awarded in the last decade have come in the last two years. Competition is fierce.”
More competition
Mike Faulkner, managing director of P-Solve Asset Solutions, an investment consulting firm that has offered fiduciary management since 2001, said: “We are seeing tons more interest from clients, and loads more competitors.
“For the first time ever, the volume of clients looking for fiduciary management outweighs the clients looking for traditional consulting, and for the first time we’re seeing investors with more than £100m coming straight into fiduciary management, without having been a consulting client.”
Firms such as APG, a manager spun out of the Netherlands pension scheme ABP,BlackRock, the world’s largest fund manager, and Mercer, the biggest investment consultant, have spotted the opportunity and are offering their services as fiduciary managers.
The service can be expensive for clients – 10 times as much as regular investment consulting services, according to asset managers – and offering such a service may not be profitable for all managers.
Erwan Boscher, head of Axa Investment Managers’ fiduciary and liability-driven investment team, said: “It’s a package with a lot of services provided at a very tight price, and there is an intensive upfront fixed cost. The only ones who can do this are those with pockets deep enough to bear losses until they get scale.”
Edward Bonham Carter, chief executive of Jupiter Fund Management, said: “It’s a natural development for the really big houses, but it’s not for us.”
The chief executive of another asset management firm, one that does not offer fiduciary management, said: “I’ve yet to see the guy who makes money from this.”
Many asset management chief executives have expressed a lack of interest for this reason.
John Hailer, chief executive of Natixis Asset Management, one of the world’s largest fund management groups, said: “It’s not that easy to do, it takes a lot of due diligence and work.”
The need for scale has led to industry suggestions that fiduciary management would see consolidation, despite increased demand for the service.
Hendrik du Toit, chief executive of Investec Asset Management, said: “We offer multi-asset investment services, allocating between asset classes, but we don’t do fiduciary management.
“For a mid-sized, stock-picking focused firm it’s not on: it’s hugely administration-intense and relationship-intense, and if there’s a problem it’s a big problem.”
Fiduciary managers look over their shoulder at Goldman Sachs Asset Management, which last year lost a €9bn mandate at Dutch pension fund Vervoer. Under GSAM’s management the scheme’s losses were 5.4 percentage points behind its benchmark, and Walter Brand, director of Pensioenfonds Vervoer, told Financial News at the time: “We appointed Goldman Sachs with the goal of outperformance for the whole portfolio – otherwise we would have just invested in indices.”
Hoping to minimise the reputational risk of losing money for a high-profile pension scheme, fiduciary managers want their clients to involve themselves in the investment decisions as much as possible.
More control
Birch, of Spence Johnson, said investors were keen to get involved. He said: “Pension funds came out of the crisis realising that they had been under informed by their fiduciary managers, and in particular that they were not made well enough aware of what could happen in any downturn.
“In future they will be looking for more control in what one investor described as a partnership, with understanding growing and pension scheme managers maintaining greater control.”
Michael Marks, chief operating officer of BlackRock’s fiduciary management business, which has 13 clients, including three in the UK, said: “The fiduciary manager should be helping trustees focus on the most important decisions, but the trustees own the decisions – they cannot delegate that.
“The benefit of the fiduciary manager is that it brings a more capital markets focus, and should be able to implement changes more quickly than the board of trustees.”
Transparency, and being a good cultural fit, is a way for a fiduciary manager to differentiate itself from its competitors. Marks said: “It’s hard for trustees to tell the difference between managers – 85% of what each one says is the same. It’s things like transparency that make the difference.”
The world’s largest fund manager is determined to stay the course, regardless of the expense.
Marks said: “We know that, if we do a really good job for these funds, BlackRock will have a future. We know the move to fiduciary management is going to happen anyway, so let’s get in the right place for it. This is an opportunity for a fund manager to be a partner.”