The #1 Problem in Fund Distribution

About this series

Welcome to the Bridging the Gap series, where we explore the fund distribution industry’s most pressing challenges and share how Fundpath is transforming the way asset managers and wealth managers connect.

Imagine trying to solve a puzzle without seeing the final picture, or navigating a dense forest without a map to reveal its hidden trails. For years, this has been the daily reality of the fund distribution industry. Asset managers and wealth managers, the two pivotal players, remain stuck in a cycle of miscommunication, inefficiency, and missed opportunities.

At the heart of it all, lies an industry problem: the Information Disconnect.

Understanding the Information Disconnect

The Information Disconnect is a problem that impacts both sides of the fund distribution industry: asset managers, who are the sellers of funds and investment products, and wealth managers, who are the buyers.

Asset Managers

At its root, the Information Disconnect stems from a reliance – by asset managers – on outdated practices and tools. Static CRMs, a lack of technology to interrogate existing data, legacy data systems, and personal but incomplete networks guide their sales and marketing outreach. While these methods may have worked in the past, they are ill-suited for the rapid pace of change in their target market: the wealth management industry.

Wealth management firms frequently rebrand, merge, or shift business models. Decision-makers transition to new roles or companies. Fund-buying preferences evolve alongside shifting market conditions. Without proprietary data and perpetually updating datasets, asset managers are left relying on outdated or inaccurate data on their clients and prospects, making it nearly impossible to align their outreach with real-time opportunities.

A lack of forward-looking data only compounds the problem. Asset managers often have little or no insight into which asset classes or investment strategies wealth managers are currently researching or planning to prioritise.

This forces them to take a scattergun approach – sending out generic pitches in the hope that something resonates. The result? A costly waste of time, effort, resources, and countless sales opportunities missed.

Wealth Managers

Wealth managers, on the receiving end of this scattergun outreach, are overwhelmed with a flood of unsolicited and irrelevant communications.

The scale of the problem is staggering: the average wealth manager receives hundreds of emails and calls daily from asset managers. Most of these communications are misaligned with their needs, leaving wealth managers to sift through this deluge in search of useful information. Over time, this leads to frustration, disengagement, and strained relationships with asset managers.

Smaller wealth management firms are particularly affected. With leaner teams and fewer resources, these firms often lack the visibility to attract the attention of asset managers, who focus their sales efforts on larger players. Yet, these smaller firms represent a significant untapped market opportunity for asset managers, hindered by inefficiencies in traditional fund distribution methods.

A Solution?

As we’ve seen, the Information Disconnect in fund distribution creates a cycle of miscommunication, inefficiency, and missed opportunities. But what might the industry look like if this problem were solved?

For asset managers, it would mean the ability to effectively target prospective fund buyers with tailored, purposeful communication, fostering more productive sales teams and raising more assets. It would also allow them to serve their existing clients better.

For wealth managers, it would mean less time spent fending off irrelevant pitches, more time spent tending to clients and only evaluating products that align with their needs.

This vision of seamless connection and meaningful engagement is exactly what led to the founding of Fundpath: to bridge two worlds that have long struggled to connect.

Fundpath is a critical data and business intelligence service for the wealth and asset management industry, designed to empower both sides of the market.

In our next article, we will talk about the Fundpath founding story and delve deeper into how we solve the Information Disconnect.

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