MangementAssetTeam Director of ManagementAsset CountryLocalRelationship1ManagerLawyerPortfolioManager CountryLocalRelationship2ManagerLawyerPortfolioManager CountryInternalLocalRelationship3ManagerLawyerPortfolioManagerInvestmentCommittee CounselGeneral InvestmentExternalCommitteLegal Team ValueTeamCreation
This section outlines common divisions in an international fund management company and their typical purpose and responsibilities. A typical investment practice is organized as a functionally matrixed organization, with the verticals of the organizational chart being the country(ies) in which the fund operates and/or invests, and the horizontals of the organizational chart being the various teams supporting the overall fund management function. The below is a sample organizational chart, the suggested roles for which are described in detail below:
The country is the main unit of operations for the investment work at [INV./FUND MANAGER NAME]. Each country has three positions. The Relationship Manager (RM), who builds the sourcing network, finds deals, and manages the relationship and project management activities of the deal through the lifecycle of the investment. The Local Legal (LL) counsel who may be full-time or hired on a contractual basis at the firm. The LL reports to the General Counsel (GC) and verifies the legality of an investment and supports the entire closing process. They also
THE COUNTRY TEAM
1 SG2X PLAYBOOK FUND MANAGEMENT SOP | SETTING UP YOUR TEAM INVESTMENT MANAGEMENT ORGANIZATIONAL STRUCTURE &DIVISIONS
● To manage the portfolio and local relationships.
● Building and managing the sourcing network. ● Sourcing prospects.
● Adhering to this SOP.
● Accomplishment of the impact targets as outlined in [FUND NAME]’s PPM.
SG2X PLAYBOOK FUND MANAGEMENT SOP |
provide ongoing legal consulting work to the portfolio. The Portfolio Manager (PM) is responsible for the monitoring and evaluation of the portfolio companies and for supporting the technical aspects of the pre- and post-investment process, in areas of financial, commercial and tax due diligence, among other work assigned to them by the fund’s Value Creation (which can also be referred to as the “Shared Growth Services” or “SGS”), Legal or Investment Management (IM) teams.
Responsibilities:
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● Bringing companies through the entire investment process.
Goals: ● Achievement of the target gross and net IRRs for investors.
Responsibilities:
Goals: ● To source the best deals.
● To build and strengthen [INV./FUND MANAGER NAME]’s brand in the country with key stakeholders.
● Ensuring [INV./FUND MANAGER NAME] is compliant with laws and regulations.
ASSET MANAGEMENT (AM) TEAM Asset management (AM) is responsible for finding, investing, growing and selling assets. AM must implement the investment strategy outlined in [FUND NAME]’s private placement memorandum (PPM) and comply with rules and regulations for [INV./FUND MANAGER NAME] and the countries in which the firm invests. AM is led by the Director of Asset Management (Dir. AM), who oversees the two divisions: Investment Management and the Shared Growth Services (SGS), which work across each country.
● Leading the closing. ● Executing legal agreements. ● Overseeing distributions. ● Ensuring [INV./FUND MANAGER NAME] is compliant with all rules and regulations.
● Designing the structure and terms.
● Approving the final terms. ● Designing the legal agreements.
● Leading the investment management and SGS teams.
● Completing the first legal screen.
● Finding, investing in, growing and selling assets.
● To efficiently evaluate the legality of an investment, ensure the firm and the investment are compliant, and to develop legal agreements.
A fund manager’s legal team is responsible for evaluating whether a deal is legally permitted under the governing rules of the country and the investment firm. Legal also leads the investment structuring design, regulatory compliance and investment closing activities.
● Reporting to the shareholders, committees and boards.
● Implementing the PPM. ● Supporting attraction of capital to [FUND NAME].
● Managing external stakeholders.
LEGAL TEAM
Responsibilities:
Goals:
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Responsibilities:
● Designing portfolio strategies and building clusters or platform strategies and companies.
● Supporting the country team with tools and resources to efficiently: a. Source deals. b. Complete deal analysis. c. Negotiate term sheets. d. Conduct due diligence – financial, tax, technical, commercial, legal, management. e. Close the investment.
QUICK REFERENCE GUIDE: “GENDERSMART” DEFINITION SG2X Playbook and is run by a genderbalanced management team that adopts gender-sensitive policies, practices and services that empower women as entrepreneurs, leaders, employees and consumers, ultimately leading to gender-responsive SME portfolios and economies. Please see the 2X Criteria for industry-accepted indicators and definitions.
Goals:
● To find, evaluate, invest in, grow, monitor and generate returns from companies in line with the fund’s investment strategy and legal agreements.
● Communicating with investors on company performance.
A fund manager’s investment management (IM) team is responsible for sourcing, research, analysis, due diligence (in partnership with the Shared Growth Services team; see section below), monitoring and evaluation, distributions and exits.
● Monitoring and evaluating the individual investments and the portfolio.
We recommend fund managers establish a value creation team, also known as the “Shared Growth Services” (SGS) team. The SGS team is “shared” because the costs of the team cannot be borne by any one SME. The team should have experienced executives that have the capacity to work across multiple SMEs that operate in a variety of sectors. The SGS team has a
● Overseeing the sale of portfolio companies.
● Overseeing distributions to investors.
SG2X PLAYBOOK FUND MANAGEMENT SOP
SHARED GROWTH SERVICES (SGS) TEAM
INVESTMENT MANAGEMENT (IM) TEAM
● Assisting portfolio companies in sourcing external funding, as needed.
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COO, CFO and a Chief Marketing and Sales Officer (CMSO). The SGS COO leads the SGS team and acts as the portfolio company’s COO/CEO during the first 24-months of the investment as the local, gender-balanced executive team is trained and apprenticed. The SGS COO oversees implementation of the post-investment First 180-Day Project Plan and the development of the tools, SOPs and trainings for the operations and administration functions that all portfolio companies are required to implement. The SGS CFO oversees finance and accounting and leads the finance training sections of The Gender-Smart Exec’s Program. The SGS CMSO oversees marketing and sales and the development of the tools, SOPs and trainings for marketing and sales functions that all companies are required to implement. We recommend three experienced executives for the SGS roles, and one to two local managers to support the team. Local managers help with communications and liaising with staff, suppliers and local stakeholders. They should be fluent in English, hard-working and coachable. They will either move into group roles on the SGS team or into operating/portfolio companies.
● Hire, train and apprentice a gender-balanced executive team to lead the company.
● Prepare the company for sale by Month 60.
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● Build gender-smart management systems within the first six to 12 months.
● Successfully transition the management of the company to the gender-balanced executive team by Month 36. ● Hit $[INV./FUND MANAGER’S TARGET THRESHOLD] EBITDA by Month 60.
● Developing the gender-balanced middle management function via training and apprenticeship.
● Leading operational due diligence, and supporting financial, tax and commercial due diligence. ● Overseeing growth planning. ● Building management systems via implementation of the Playbook.
Responsibilities:
● Operate those systems from six to 24 months in order to improve them.
Goals: ● Increase the value of the portfolio company.
● Supporting growth and development at the Board level.
The [INV./FUND MANAGER NAME] IIC is made up of the Managing Partners, General Counsel and SGS COO. Reviews deals and votes to advance deals through the various stages of the investment process.
● Evaluating middle management. Transferring management to the local, gender-balanced team.
●
External Investment Committee(ExternalIC)
Chief Investment Officer (CIO) Executive Approving all investments and signing on disbursement documents.
NDIVIDUAL ROLES &RESPONSIBILITIES
● Overseeing operational projects as needed.
I
Member Advisory Committee(MAC)
●
● Training [INV./FUND MANAGER NAME] and other stakeholders on best practices and lessons learned. ROLES &RESPONSIBILITIES
An external committee that reviews and approves investments on behalf of [FUND NAME]’s investors. Accountable for ensuring each deal complies with [FUND NAME]’s investment criteria.
● Providing reports to the IM and AM teams. Supporting the sale or scaling of the company.
An external committee made up of members of [FUND NAME] that reviews conflicts of interest and reviews the overall strategy of [FUND NAME].
Internal Investment Committee(IIC)
ROLE TEAM RESPONSIBILITIES
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ROLE RESPONSIBILITIES
General Counsel (GC) or LocalLegal(LL)
COMMITTEE
Executive Preparing, reviewing and approving all legal documents (those [INV./FUND MANAGER NAME] signs); and reviewing and approving
COO(SGSCOO)
AM Overseeing the IM team and is accountable to the CEO and [FUND NAME] IC for implementing this SOP, designing the ideal portfolio of platform companies.
SGS Leading the SGS team. Supporting operational due diligence, implementing the SG2X Playbook in each portfolio company, leading the SGS team; supporting The Gender-Smart Exec’s Program.
CMSO(SGSCMSO)
Director of Asset Management(Dir.AM)
SGS Supporting commercial due diligence, implementing the SG2X Playbook in each portfolio company, leading the SGS Sales and Marketing team; running the Growth Mastery Program.
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IM Finding new companies; leading companies through the investment lifecycle; being the main point of contact between the company promoter and [INV./FUND MANAGER NAME]; managing a good working relationship between [INV./FUND MANAGER NAME] and the company.
Investment Analyst (Analyst)
PortfolioManager IM Managing the monitoring and evaluation work
Shared Growth Services
CFO(SGSCFO)
Shared Growth Services
IM Accountable for training new members, managing internal meetings, implementing this SOP, and managing the overall flow of companies through investment lifecycle.
RelationshipManager(RM)
ROLE TEAM RESPONSIBILITIES
any deal before it comes into the pipeline.
IM Preparing all financial and research related content, documents, and material on a pipeline or portfolio company.
Senior Investment Manager (SIM)
Shared Growth Services
SG2X PLAYBOOK FUND MANAGEMENT SOP |
SGS Supporting financial due diligence, implementing the SG2X Playbook in each portfolio company, leading the SGS Finance and Accounting team; running the CFO100 Program.
8 SG2X PLAYBOOK FUND MANAGEMENT SOP | ROLE TEAM RESPONSIBILITIES on the portfolio company.