Emerging Manager Definition and Life Cycle

The Emerging Manager Program has compiled guidance including a Universal Definition and Life Cycle Stages to assist in consistent screening, monitoring and progression of potential candidates for inclusion in the program, independent of asset class considerations.

The Fund’s Emerging Manager Universal Definition includes characteristics such as:

Majority owner-managed
Verifiable successful track record in the proposed strategy
Manager orientation towards investing to build an institutional investor-ready firm
Sound compliance and operating standards
Institutionally-trained professionals
Firm’s principals have years of experience working in the strategy and with each other
Fiduciary practices

Life Cycle Considerations

Within a portfolio approach, the Fund and program partners seek to diversify exposure by stage of emerging manager life cycle. Informed by the 2018 survey, the Fund considers the following guidelines when evaluating business life cycle stages.

Stage	Traditional Attributes for the Stage
Seed & Early The firm typically has managed money for institutional investors less than five years	Has access to *sufficient capital* to procure appropriate infrastructure Has a *growing base* of investors Has access to *sufficient capital* for investment team build-out and a co-investment in the strategy that is meaningful for alignment Has *sufficient full-time staff* with tenured industry experience
Mid & Late	Is a well capitalized firm that shows positive operating cash flows Has key internal infrastructure in place, with redundancies in mission-critical investing and operating processes Has reasonable growth in assets under management (AUM) over the last three years Has *increased breadth* of ownership and has reduced key person risk Has *increased diversification* of investors by type of investor Has *established appropriate* environmental, social and governance (ESG) policies and procedures

Stage

Traditional Attributes for the Stage

Seed & Early

The firm typically has managed money for institutional investors less than five years

Has access to sufficient capital to procure appropriate infrastructure
Has a growing base of investors
Has access to sufficient capital for investment team build-out and a co-investment in the strategy that is meaningful for alignment
Has sufficient full-time staff with tenured industry experience

Mid & Late

Is a well capitalized firm that shows positive operating cash flows
Has key internal infrastructure in place, with redundancies in mission-critical investing and operating processes
Has reasonable growth in assets under management (AUM) over the last three years
Has increased breadth of ownership and has reduced key person risk
Has increased diversification of investors by type of investor
Has established appropriate environmental, social and governance (ESG) policies and procedures