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The Future Fund Model Needs Global Perspective

As private capital crosses borders, back and middle office functions must develop an international mindset.

As private capital matures and becomes more competitive, asset managers naturally turn to specialized funds as they look for new opportunities. Increasingly the search for new investors ranges across borders and time zones, while the best investment opportunities in a desired sector may already be aggregated in favorable locations around the world.

The result is that most growth-focused private capital asset management firms have an international outlook when it comes to deal-making and fundraising. The challenge for many of them is that their fund operating models have not kept up.

When you deal with widespread assets and investors, you need international expertise. That’s as true for the back office as it is for the front.

Private capital looks for global scale

Large private equity and real-estate funds have operated internationally for years but today all types of funds are competing in a global marketplace. For example, as private markets have become more sophisticated, sector-specific funds have sprung up that focus on highly specialized asset classes or locations.

A real estate fund manager might specialize in purpose-built student accommodation or distribution warehouses, for example. Such a narrow focus has clear advantages, but to thrive and grow, niche asset managers often need global scale in terms of capital.

The compliance challenge to fund models

Whatever their size and focus, sooner or later global funds hit turbulence.

Fundraisers quickly find that fund marketing is treated very differently by regulators in different countries. The back office soon discovers that every jurisdiction has its own compliance and reporting quirks.

And regulatory requirements are ever evolving. An asset manager who had dealings with a jurisdiction three years ago might find that in the intervening years, the regulatory landscape has changed dramatically.

The complexity of global private capital funds

Managers, assets, and investors are dispersed around the globe. The structures themselves are housed in whichever jurisdiction offers the best combination of cost efficiency, administrative simplicity, or regulatory protection for investors.

All of this magnifies the complexity of managing and maintaining a global private capital fund. That fund might have international assets aggregated in a holding company, which in turn is part of a master holding structure.

Below that is the fund vehicle itself, and—most likely—carry vehicles for the asset management team and limited partners. There may even be a side pocket for special circumstances.

Add it all up and the back office may be dealing with five or six jurisdictions, each with its own standards, laws, and culture. Simultaneously, global investors bring with them a wide range of expectations around data and the immediacy of information.

It’s just one more reason that fund operating models need to develop a global view—and quickly.

Nurturing a broader outlook for global funds

That global view needs to include local knowledge around regulation, business culture, and investor expectations, and be repeated in every applicable jurisdiction.

For efficiency, it should be combined with a centralized administrative team to take care of the generic heavy lifting that repeats in jurisdictions and for investors.

Above everything, the fund model needs a helicopter view to oversee global compliance timetables and monitor regulatory and legal developments.

It’s possible to do this in-house—and some larger asset managers continue to run central compliance and administrative teams combined with local employees in every jurisdiction. But it’s becoming harder. Recruitment has been a challenge since the pandemic and talent management is now far more complex.

With that in mind, many asset managers worry that overseeing global operations teams is taking focus and limited resources away from core functions.

Some are turning to outsourcing to balance local knowledge and central support with scalability. But there is no one-size-fits-all solution and funds must choose the right model for their circumstances and investor base.

However they do it, they need to make fund operations fit for the increasingly globalized nature of private capital. The opportunities are immense but will only be grasped if front and back office teams share an international outlook.


CSC provides tailored administration and strategic outsourcing solutions to support the complex operations of alternative asset managers across jurisdictions and asset types while adhering to global regulations and compliance. A market leader, we work with funds of all sizes, from start-ups to the largest and most experienced fund managers in the world. Founded in 1899, CSC prides itself on being privately held and professionally managed for more than 120 years. We are the trusted partner of choice for more than 90% of the Fortune 500® and more than 70% of the PEI 300. CSC has office locations and capabilities in more than 140 jurisdictions across Europe, the Americas, Asia Pacific, and the Middle East. We are a global company capable of doing business wherever our clients are—and we accomplish that by employing experts in every business we serve. We are the business behind business®. Learn more at