An Alts Shop May Grow its Sales Force by 50%
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Thursday, April 25, 2013

An Alts Shop May Grow its Sales Force by 50%

When David Linton took on the job of head of sales & intermediary services at the $17.9 billion Houston-based assets manager Salient Partners in February 2012, his goal was "to build out distribution for this relatively undiscovered company," he recently told MFWire.

We are trying to figure out how to promote a firm that is relatively unknown but with a unique product line. How do your represent this firm in an extremely competitive world of retail distribution and mutual funds?

Salient has a unique attitude towards volatility, as outlined to MFWire recently by president Jeremy Radcliffe.

The problem though, Linton said, is that most investors are still squeamish about alternatives and volatility, and many financial professionals have yet to find ways to effectively communicate their merits.

"Many investors still view alternatives as risky and unknown. They think of words like derivatives when they think of alternatives and that, again, speaks to the perceived risk in a portfolio, when in fact the opposite may be the case," he said. "They are not adopting these products because there has been an inherent lack of ability for asset managers to connect the dots of the complex strategies to end investors."

To that end, Linton wants to aggressively grow Salient's sales force, which currently numbers about 27 people, by as many as another 14 folk -- an increase of 50 percent.

"We are building a team of sales people who are educated and trained in the world of alternatives. They are skilled in communication where they understand how they use complex strategies to craft a simple message to advisors and end investors. We want people who understand the nuances and intricacies of the underlying strategies cold," he said. "We want to have people out in the field as portfolio strategists who can sit down with the financial advisor and articulate the nuts and bolts of the underlying strategies like a portfolio manager."

Linton said that Salient currently has:

  • 4 dedicated RIA wholesalers
  • 3 dedicated portfolio strategists
  • 12 dedicated broker dealer wholesalers, all external positions, all supported by 6 internal sales people. ("When I joined Salient, we had 5 externals and 3 internals," he said.)

  • Linton said that in the next six to 12-months, he aims to have "more in the neighborhood of 20 external sales people and probably 8-10 internal sales people."

    "How quickly we grow and how quickly I would grow the sales force is a function of access and opportunity," he said.

    He added that "one of the biggest challenges that small firms face is access to platforms and attaining dealer agreements. The key accounts role is critical. To that end, we have hired a Head of Key Accounts, who manages our key relationships, and we currently have one person supporting that role."

    That team, Linton said, will grow by at least 2 or 3 over the course of the year to at least four people dedicated to key accounts.

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