The Battle of Transparency: Why Investor Communication Platforms are Good for BOTH Fund Managers and Investors

The goal of investor communication platforms is not to reduce transparency in the industry, but to facilitate it.

17 March 2014


Last week, Reuters published an article on how hedge funds like Third Point Capital, Paulson & Co, Pershing Square Capital Management, and Eton Park Capital Management have made it more difficult for investors to see fund performance, using complex password-protected websites. The story points out how investor communication platforms may make it challenging for investors to access and consume the information being sent to them by their managers. Intralinks is mentioned several times in the story.

While this article mainly discusses the communications conflict between fund managers and investors in respect to how much information is shared, there are a few items I’d like to point out in regard to our own solution based on feedback we’ve received from fund managers about the need for security and transparency.


  • The goal of investor communication platforms is not to reduce transparency in the industry, but to facilitate it.  Many private equity and hedge funds use Intralinks to provide their investors with more information, not less. Products like our own solution, Intralinks Fundspace™, gives fund managers a controlled process to share sensitive information - enabling them to send content they might not normally feel comfortable exchanging with a community where manager data and commentary are shared quite frequently.  In a previous role as the CIO of a large family office, I had a conversation with the head of investor relations of a multi-billion dollar hedge fund about issues around transparency.  He told me, “Look, I know as soon as I email something to a client or prospect…it’s out there…to his colleagues, the press, everyone.  That’s why we feel the need to limit the amount of information we distribute.”  Also, just a few weeks ago, a blogger posted that Greenlight was building a position in Micron Technology while they were still in the accumulation phase - certainly not a beneficial situation for Greenlight or their investors.


  • Intralinks provides the ability to restrict forwarding, printing or copying information.  However, it is up to the managers to decide what type of restrictions they want to place on their information.  We find that many managers “tier” the delivery of their information and gradually reduce restrictions once they become more comfortable with the intended recipient.


  • The article states that platforms like Intralinks can be complex, and while I cannot attest to other communications platforms, Intralinks has over 25,000 institutional investment organizations as registered end users.   If a user has any questions or needs help navigating our site, we have live global customer service support available in 140 languages.

In this day and age, investors are asking for more and more transparency from their fund managers – not only hedge funds but from their private equity and real estate managers as well.  I have heard from a number of GPs that they don’t understand why investors need certain types of data and what they are necessarily doing with it.  At the same time, investors absolutely need to have a comprehensive view into their investments in order to make informed decisions and take action if necessary. We encourage a greater dialogue between managers, investors and related parties to establish best practices and a common understanding on what transparency really means and how to facilitate the flow of information in our industry.

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