Corporate Moves
Sell-Side Firm Wolfe Research Launches Alternative Asset Management Unit
The platform will offer investment opportunities across private markets.
Reported by Matt Toledo
Equity research firm Wolfe Research Advisors LLC announced Thursday the launch of Wolfe Alternative Asset Management, offering clients access to private market deals and insights.
The platform will allow institutional clients to search for deals in the private markets across venture capital, private equity and private funds, with the firm co-investing alongside its clients.
In the announcement, Wolfe Research noted the rapid rise of the private markets ecosystem—now standing at $22 trillion in assets under management—more than tripling from between $5 trillion and $7 trillion in 2015.
The growth of alternatives coincides with the trend of private companies choosing to stay private for longer, while creating much of their value before going public, which the company stated leaves public-market investors with less exposure to post-IPO value creation.
“In our view, public markets are increasingly indexed, correlated, and dominated by a handful of mega-cap names, leaving alpha generation harder to come by,” wrote Ed Wolfe, the company’s CEO, in the announcement. “Top-tier private deals have often been concentrated amongst the largest institutions, leaving most qualified investors on the outside. WAM hopes to change those dynamics for our members.”
In the future, Wolfe Research also plans to enter the secondaries market, facilitating liquidity for both buyers and sellers of positions in venture capital, private equity and private fund interests.
“As more value continues to migrate to the private markets, the line between the two markets is blurring. Companies stay private longer and investors now operate on both sides of the line,” Ed Wolfe wrote. “Therefore, understanding and exploiting sector dynamics requires seeing opportunities across public and private markets alike. This convergence is precisely why Wolfe’s roster of seasoned analysts with deep fundamental knowledge across public and private players is well positioned to help investors navigate the rapidly evolving landscape.”
David O’Malley, who joined the firm zs head of Wolfe Alternative Asset Management last year, will continue to lead the new unit.