The Chestnut Story
In September 2008, after 17 years on Wall Street, our founder Amanda Tepper joined a top 10 equity manager just as the stock market collapsed and her firm’s flagship fund’s performance was down over 50%. She saw that clients didn’t understand what was happening with their money, and were upset and panicked as a result.
So in January 2009 Amanda researched and published an article showing that investors had historically sold at exactly the wrong time, explaining why now was the time to invest more money with her firm. Withdrawals slowed, and the fund’s later outperformance enhanced clients’ perception of the firm.
The strong client response to that article gave Amanda the idea for Chestnut: a consulting firm that would provide world-class investor education to asset managers who had great insights but didn’t have the capacity to share them with investors.
When Amanda sought a co-founder for Chestnut she recruited Maria Onorato, whom she’d first met at a girls’ indoor soccer tournament. Amanda was reading the Wall Street Journal when Maria approached her with an insightful comment about that story. Amanda thought Maria’s 20 years’ experience providing strategic counsel to a wide range of businesses would be a perfect fit. Maria would ask the right questions and Amanda could focus on finding the best solutions.
Maria immediately questioned the need for Chestnut’s services. If investors craved insight, why weren’t their asset managers providing it?
So we conducted research to find out why investors hire asset managers. The results were so strong we thought our analysis was wrong and ran it again. Performance was not an important factor; in fact, the best performers raised four times LESS capital than the best growers. These surprising results led to the firm’s first white paper, Your Performance Doesn’t Really Matter.
Since then Chestnut has helped many clients ranging from small hedge funds to multi-billion-dollar asset managers strengthen their business by asking the right questions, focusing on what matters, and telling a high ROI story.