Your Business Health Checkup: How Asset Managers Are Thriving Through COVID-19

Alerts / March 19, 2020

While the current pandemic has thrown financial markets into upheaval, there are many things asset managers can be doing now to limit their exposure and to set themselves up for exceptional returns going forward. Consider this your COVID-19 health checkup.

  • Business interruption insurance: Do you have business interruption insurance and, if so, have you contacted your insurer? Not all policies will cover losses you suffer from the coronavirus, but chances are good this insurance may mitigate your harm in the short-term. The only way to know for certain if you have coverage is to contact your broker.
  • Triggers in existing contracts: Many of your contracts with portfolio companies, investors and service providers may contain force majeure provisions. These provisions excuse performance under certain unforeseeable circumstances. Now is the time take inventory of where such provisions can be used offensively by you or defensively against you.
  • Drafting new agreements: It’s time to update your stock reps and warranties clauses. Make sure any new contracts take into account risks associated with the current situation.
  • Stay open to new opportunities: The world has not ended. Deals are still being done. Unique situations like these create big spaces for nimble companies like yours.
  • Keep your investors in close touch: Let your investors know you are up and running, adjusting to these new times, and still doing your best to take care of their money. There is no reason you can’t set up a virtual meeting with individual LPs. Make sure everyone feels invested in this process, and they may even have some good ideas for you in this changing-every-moment environment.
  • Be grateful for this unique moment in time: Likely never again in our lifetime will be we forced to spend so much time with ourselves and our families, with no expectation that we should be turning up at the office. When we emerge from this it undoubtedly will be, in many ways, a new world.

If there’s anything on this list you haven’t yet addressed, many of the answers can be found here, where we are putting out daily updates on how companies are being impacted by COVID-19. If the answer isn’t there, please reach out. This is a time when we are all eager to use the skills we have to help each other.

Authorship credit: Jessie M. Gabriel

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