Bitcoin, Ethereum, Cardano; cryptocurrencies have made their mark on the investment industry, and even alternative funds have struck a fancy with them. According to Autonomous Next, there are now more than 120 hedge funds dedicated to trading cryptos, amounting to a total of over $2BB of assets under management (as per Cheng, 2017). If you are an alternative fund manager jumping on the crypto wagon, there are some special considerations you should take into account about how you are marketing your funds.
Why Brand Matters More for Crypto Funds
Word of mouth is the best way to develop business. There is nothing like having built in credibility from the start. But referrals cannot be counted on. They should be viewed as a bonus, not what you should depend on to fill your pipeline. This is because in a bad market, if your fund goes down (and many hedge funds do, despite what they say), there is almost no way that people are going to refer you to their inner circle.
Whatever way you get noticed by investors, the way you present yourself is critical. It is very important that you can clearly articulate the strategy you are selling. If not, then credibility is lacking. This is especially true for cryptocurrency managers.
Why?
We are not picking on you here but think about what the world knows about cryptocurrencies. Practically nothing. It is not acknowledged as a real asset class like a stock, a bond, or a piece of real estate. The jury is still out as to whether cryptocurrencies can actually be categorized as currencies. Many investment managers feel that there are fundamental differences.
Aside from the lack of knowledge about them, there is a great deal of apprehension surrounding cryptocurrencies. They are viewed as more risky because they are unregulated and, let’s face it, well…virtual. They do not exist in physical form.
Moreover, there are not many hedge fund managers who have experience trading it. This is true even for all the alternative fund managers who do not manage traditional asset classes, for example currency or commodity traders who are used to trading volatile instruments. They may have traded the Rupee or the Yen, but they have not traded the Ripple! You have an entire industry starting with a blank resume.
For these reasons people naturally view cryptocurrencies as speculative.
Branding Tips for Cryptocurrency Funds
Use your brand to counteract the resistance that people will have in their minds. Here is how.
Hire a Branding Professional
The first thing I would say to any cryptocurrency fund is to hire a professional to create crisp marketing materials that show you are not a fly-by-night operation. High net worth individuals can tell a DIY pitch book when they see one.
Avoid the Tear Sheet Pet Peeves
Missing contact information, confusing performance presentation – the list is long but we wrote an article about the five worst offenders to avoid. Read it here.
Strategically Pick a Name and Logo
We would recommend that crypto funds stay away from imagery and wording that reflects instability.
Name your fund with this in mind. Instead of using your last name or your initials, give it a moniker that reflects the idea of stability and intention rather than instability and chance. Doing it this way will help convey the idea of the opportunity and place less emphasis on the risk element.
It is less advisable to pick a name that is intriguing, cryptic, or fantastical which will only enhance the stereotype. Stick to the familiar and straightforward.
Use a Pitch Deck that is Easy to Update
Things change pretty rapidly in the crypto universe, and there is of course always news on cryptocurrency to report. Once you invest in a professionally designed pitch book, it does not have to cost a fortune to keep the maintenance up. Some designers will make it so that your staff can do it on their own without interfering with the design.
Make sure your deck is created in PowerPoint rather than Keynote or InDesign. This way you and your team are able to right click and populate new data into the deck easily without ruining the style elements.
Be Consistent
We have articulated it before as “be as consistent as the sun.” Yes, just as the analogy conveys, you have to uphold this rigor daily.
Be systematic in everything you do in order to increase investor confidence. For example, send out your performance results on the same day each month.
Summary on Cryptocurrency Fund Branding
As crypto funds are the latest and greatest trend in alternative investments, there are likely going to be many players entering the field. The right branding and presentation can set you apart or can set you back. Email jessica@karmankreative.com to talk about how you can make sure your brand is a contributor to rather than an inhibitor to your growth.
Sources
Cheng, Evelyn. (2017, Oct 27). There are now more than 120 hedge funds focused solely on bitcoin, digital currencies. CNBC. Retrieved from https://www.cnbc.com/2017/10/27/there-are-now-more-than-120-hedge-funds-focused-solely-on-bitcoin.html