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Question & Answer

Gemini Fund Services Foresees Clients' Twin Needs: New Solutions, Distribution

Gemini Fund Services, the Hauppauge, N.Y.-based administrator and back-office service provider to small and niche mutual funds, hedge funds and variable insurance trusts (separate accounts utilized for variable annuity contracts and variable life insurance policies), has big plans for 2008.

In addition to pursuing new investment management clients that operate on a day-to-day basis as part of several cost-effective series trusts that Gemini offers, including the Northern Lights Funds Trust, the firm's executives will be reaching out more actively to new and existing clients.

Gemini's plans include expanding services and launching a brand new advisory council forum under which all clients will be able to share ideas, best practices and combine initiatives to realize cost savings.

The ultimate goal for Gemini is to help clients build their investment management businesses and consequently foster a deeper sense of loyalty to the administrator. Right now, the firm provides administration to about $7 billion in assets across 120 investment funds and 45 clients. The firm also has a subsidiary, Fund Compliance Services, which provides compliance services and a chief compliance officer on a full- or part-time basis.

Gemini itself is relatively new to the administration business, but its founders are not. Gemini is the successor to American Data Services, founded in 1983 by Michael Miola. Miola equitized the mutual fund industry by creating an accounting system that allowed small, boutique investment managers to preside over mutual funds right alongside the biggest providers. He sold the predecessor firm to Orbitex Fund Services of Stamford, Conn., in 1999 but three years later bought it back and, subsequently, in 2003 renamed it Gemini.

Money Management Executive Editor-At-Large Lori Pizzani recently interviewed Andrew Rogers, president of Gemini Fund Services. An edited version of their discussion follows.

MME: Are new Gemini clients mostly start-ups or those seeking new service providers?

Rogers: Most of our new clients are start-ups, but we do see some new business from existing funds looking for a better way of doing things.

Start-up clients are typically those that have been managing money in separate accounts for years or decades and are seeking a way to grow their business while continuing to service their clients. Some want to take their investment strategy to a new level and make it available to a broad, national audience.

MME: As Gemini signs on new clients, what services are clients telling you are most important?

Rogers: New clients are seeking more solutions, and they want comprehensive, turn-key solutions, such as compliance and fund governance, as well as the more typical accounting, administration and shareholder services.

Generally speaking, clients are always seeking additional help with distribution, and service providers are seeking innovative ways to help their clients achieve that. In this business, everyone wants more distribution.

MME: How are you responding to that distribution request?

Rogers: In response to this increased demand by our clients, we have an additional service offering that we are launching in the first quarter. We are currently in the planning and development phases of launching a joint advisory council. This will be a forum for our investment advisor clients to share ideas with each other, network and collaborate on their marketing and distribution efforts, all under the Northern Lights Funds Trust umbrella. It seems like the next logical step.

We've already hired a business development manager whose sole purpose will be to create and implement the advisory council and its services. Following the launch of the council, he will also be responsible for assisting all clients in their sales and marketing objectives.

We hope to expand this area of our business in the future by adding internal staff to the business development team and externally by bringing more advisors into the advisory council.

MME: What services will this new advisory council offer?

Rogers: Advisors will be able to attend industry conferences under the Northern Lights Funds Trust aegis, giving them increased access to investors and other financial service providers, as well as networking opportunities and marketing of their funds.

There will also be an advisory council blog where members of the council can share ideas and strategies with each other, really using the power of collaboration to their advantage.