Here are some key quotes from my latest podcast with Josh Barlow, Managing Director and Founder of Valhalla Fiduciary:

“I plan to always be the only one sitting on boards. . . . I plan to keep it boutique and focused, and it’s just a different business model. But that was the business model that I really wanted to build.”

“I’m speaking with managers and investors every day and different service providers, the prime brokers, the lawyers, administrators, auditors, there’s a lot of interaction. So it’s pretty easy to stay on top of things and in tune.”

“First and foremost, [as a board director] you’re a fiduciary to the fund and the investors as a whole. So I need to uphold the fund documents and do what is best for the investors of the entire fund.”

“If you’re planning to have a firm where you manage hundreds of millions or a billion, then guess what? You are going to need to have independent directors because this is the best practice. Institutional investors expect this and that’s regardless of the value-add that directors bring.”

“After seeing hundreds and hundreds of managers over these 15 years, I can tell you the culture from the top matters. And managers that have sloppy operations, managers with sloppy organizational structures, guess what? They’re also sloppy on the portfolio side, on the investment side, almost without fail.”

“Now, as the industry has evolved, you have really what I’m trying to do, which I would call “the value-add director” or the “consultant director”. So even though your official role is director on the fund, you’re trying to add value in whatever way you can.”

“But that’s the question that managers and investors should ask directors, ‘How many boards are you on?’ It’s common in the industry that directors will quote that based on manager relationships, the number of manager relationships. So you should ask that question, but then you should still follow up with ‘Well, how many actual boards is that?’”

“Historically, PE has lagged hedge funds with regard to best practices and operational structures; there will be a movement toward independent governance in PE.”

“My gut tells me that this will be a good year for alternatives. And a year where alternatives can say, ‘Hey, look, we did what we were supposed to do. We hedged and we performed.’”