Northern Lights Ventures, a strategic partner and provider of capital to boutique asset management firms, has merged with Echelon Capital Group, a provider of capital and distribution services to boutiques.
The new firm, called Northern Lights Capital Group, will combine Northern Lights' “strength in identifying leading boutique asset managers” with Echelon's “strategic support and distribution capabilities,” according to a news release.
The merged entity will be led by five partners, three from Northern Lights — including Russell Investments veterans Paul R. Greenwood and Andrew L. Turner, and Timothy J. Carver, a private equity veteran with Orca Bay Partners — and two from Echelon, Janus Capital Group institutional sales veterans Jack C. Swift and John W. Zimmerman.
The firm will take minority stakes in the boutique asset management companies with which it partners. Its current “family” of boutiques counts nine firms with a combined $6 billion in assets as of April 30, according to the news release.
In an interview, Mr. Zimmerman said the partners from both firms saw the logic of pairing Echelon’s strengths in strategic business development and distribution with Northern Lights Ventures “world class” ability to source and structure deals with boutique partner firms.
In the same interview, Mr. Greenwood said with an $80 million pool of perpetual capital, the “ultra-long” view of Northern Lights Capital Group when it takes minority stakes in partner firms will be one factor distinguishing the firm from private equity investors looking to cash out from investments in five or seven years. The firm’s ability to provide strategic advice — from business planning to marketing and distribution — is another differentiating factor, he said.
Mr. Greenwood called the current environment rich in opportunities, predicting Northern Lights Capital Group will announce a number of investments in partner boutiques over the coming months.