A former private equity executive at BlackRock has formed an advisory firm that will work with time-crunched institutional investors on finding specific strategies they don’t have the time to research themselves.
Alexander Abell, who most recently worked for four years as a director at BlackRock Private Equity Partners, a fund of funds, launched the firm, called Atlas Diligence, in June.
Atlas Diligence will not simply work as an alternatives advisor, Abell told Private Equity International in a recent interview. Rather, the firm will “provide LPs outsource extensions of their teams”. Instead of forming long-term contracts with LPs, the firm will work on a more “project-oriented basis”, Abell said.
“Our goal is to offer institutions our best practices and help them leverage what they have in-house and maybe help them cover new areas [of alternatives], like new geographies that they maybe haven’t had the time or bandwidth to map out themselves,” Abell said.
Our goal is to offer institutions our best practices and help them leverage what they have in-house and maybe help them cover new areas [of alternatives].
For example, a pension may want to start building exposure to distressed investment strategies or emerging markets, but may be unable to complete the level of diligence and analysis needed to explore the space, he said.
“We have the ability to figure out and triage the opportunity set that exists in those areas,” Abell said.
Since formation, the firm has worked with a few family offices. “Our best client groups are those who are used to doing their own work, but could use someone like us to do some of the analytics and bring that to bear on their decision-making process,” Abell said.
Atlas Diligence has been in discussions with a range of private equity LPs, including endowments, private and public pensions and family offices.
Abell has built a team with a background in analysing and choosing private equity managers. He has worked on/focused on manager selection for about 10 years, most recently at BlackRock, and prior to that at Quellos Private Capital Markets, which was acquired by BlackRock in 2007. Prior to Quellos, Abell worked with Hewlett-Packard’s pension's investment management arm on alternative investments.
Working with Abell are John Leraas, who joined Atlas from BlackRock where he also engaged in private equity manager selection, and Sarah Zilzer, who previously worked at Cambridge Associates. The firm also has four analysts.
The firm launch comes at a time when many institutional investors find themselves busier than ever, with as estimated 1,500 funds expected to be in the market this year, many of them managers looking for return investments from existing LPs. Selection of managers with whom to “re-up” takes research and analysis and for institutions with private equity teams that are under-staffed, this work can take up the bulk of time.
In this environment, building exposure to a new strategy or geography could be too much to handle, and this is where Abell hopes his firm can thrive.