RAIF: a creative vehicle for investing in tomorrow’s world
Fuchs Asset Management SA (‘Fuchs AM’) is the Management Company (‘ManCo’) within the family-owned Fuchs Group located in three jurisdictions: Luxembourg, Belgium and Switzerland. As an authorised AIFM, it provides the services and the knowledge (governance, risk management & compliance, portfolio management and distribution) for asset managers, private banks, family offices and entrepreneurs wishing to launch AIFMD & UCITS compliant vehicles as easily as possible.
Over the last four years, Fuchs AM has been expanding its AIFM capabilities to support investment managers, including private equity managers, who have deep investment expertise but aren’t necessarily equipped to run their own regulated management company business.
With the Reserved Alternative Investment Fund (‘RAIF’) also proving a huge hit with Private Equity (‘PE’) managers, these are propitious times for the Fuchs Group.
“We offer all the processes and procedures as a regulated AIFM,” comments CEO, Timothe Fuchs (pictured). “The managers can come to us with their investment idea, and if it is viable and makes sense, they can launch a RAIF quickly and easily. Whereas you need to have investor capital in place on day one for regulated products, this is not the case with a RAIF – a manager can launch it first and then do all the necessary marketing.”
What gets Fuchs and the team especially excited is that the RAIF allows for creativity. The RAIFs on its platform are highly diverse, but the common thread is that each PE manager client is investing in areas that will have a tangible, positive impact on the planet. Such is the ease of bringing a RAIF to market, with Fuchs acting as the AIFM, that it is encouraging more PE managers and innovators to develop unique strategies.
“Companies are using the RAIF product as a way to encourage investors to invest in the real economy. It is helping investors make a difference. In the past, these private market investments would have been harder to access; the RAIF is changing that,” says Enrico Mela, Managing Director at Fuchs AM.
The notion of partnership is very important when selecting a third party AIFM. As Fuchs notes: “What gets me passionate is that, as an AIFM, we have a fantastic opportunity to support people who have good ideas and are looking to do things that have an added value for the economy and for future generations. It’s amazing to look at the different investments our clients are involved with. With our third party ManCo concept, we can support PE companies in their investment goals.”
“That’s what gets me up in the morning, thinking about how we can partner with clients to complete their vision,” continues Fuchs. “Within our group we provide also family office services and we are developing together with our client’s ideas how to invest differently. That’s not to say that traditional financial markets are not still interesting, on the contrary, but we need to think about investing in the real economy for future generations.”
In his view, the experience or structure of the ManCo is not necessarily the key consideration for a PE manager wishing to launch a RAIF.
“Rather, you need to have a common interest in forging a genuine, long-term partnership. The chemistry has to be right. The rest brings added value but it all boils down to the human relationship in my opinion. Ultimately, does the AIFM share your passion?” concludes Fuchs.