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Breakout Funds

How global macro strategy Breakout Funds increased their AUM from $3mn to $175mn with Preqin


Firm Type: Fund Manager

Asset Class: Global Macro Strategy/Hedge Funds
AUM: $175mn
Use Case: Fundraising, Benchmarking, Competitor Analysis
Headquarters: Chicago, IL, USA
Product: Preqin Pro
Website: https://www.breakoutfunds.com

The context:

Founded by Aaron Larkin and Matt Laviolette, Breakout Funds is a discretional and opportunistic global macro strategy. With $3mn in starting capital from a high-net-worth client, the fund has rapidly grown to $175mn AUM as of September 2022.

Breakout Funds attributes their success to their early marketing efforts and subsequent performance returns. The fund began using Preqin in 2020, and since then they have seen their most significant growth – firmly establishing their presence in the institutional space.
We started using Preqin in 2020 because we wanted to reach a wide network of investors to deliver an institutional product that fits well in any portfolio.
Bryan Leavitt, Managing Director, Breakout Funds

The challenge:

“We didn't come from the alternatives space,” says Aaron Larkin, Breakout Funds Co-Founder and CEO. “Matt and I both started off as traders at the Chicago Mercantile Exchange, and so we weren’t particularly well connected with institutional investors and allocators.”

“When it came to building those connections, we couldn’t just send our material out to everybody. We could have of course, but it would’ve been a waste of everybody's time. We had to narrow it down to people where the relationship would work both ways.”

To diversify their investor base, the fund needed to identify clients with specific amounts of AUM, and particularly those who had mandates specifically for the global macro space.

“You have to raise AUM to attract AUM, so early on we used the Preqin database to identify people who not only fit our current strategy – but also those who might in future,” Aaron explained.
Preqin’s large database, contacts and filters really helped us to find specific mandates from allocators and identify who might be a good fit for our strategy.
Aaron Larkin, CEO and Co-Founder, Breakout Funds

The solution:

Before they subscribed to Preqin, most of Breakout Fund’s networking was done through brokers and conferences. This meant that they were forced to pay costly broker and IP fees as they worked to build new relationships with institutional investors.

Their main challenge was to engage with clients who were receiving thousands of emails per day. Preqin’s contact database helped them to make their own introductions, and by the middle of 2020 they were talking to new investors two or more times per day.

“Preqin really increased the breadth of who we could connect with without having to go through multiple channels. It introduced us to people more quickly across the board, in a way that might not have been possible just by shaking hands or talking to people,” says Aaron.

The fund found that their shared familiarity with Preqin gave them an excellent starting point for conversations with potential investors. In practice, Preqin served as the foundation for many of their communications, which saved time for all parties involved.
We've used the Preqin name as an icebreaker in a lot of our introductions. We can say, ‘we found you through Preqin’ – and a lot of our clients have been really receptive to that.
Bryan Leavitt, Managing Director, Breakout Funds

Why Breakout Funds chose Preqin

  • Access to a platform for networking and outreach that enabled Breakout Funds to rapidly increase their AUM
  • Comprehensive insights that were critical to staying ahead of the competition in a fast-paced industry
  • Easy-to-use tools, services, and benchmarks that streamlined fundraising efforts
  • A seamless onboarding process that was the logical choice for an ambitious and results-driven fund
Preqin helped us to grow the breadth of our network and to make some connections that we couldn’t have made without it.
Aaron Larkin, CEO and Co-Founder, Breakout Funds

The result:

As business continues in 2022, volatility has seen Breakout Funds bounce back from a small drawdown in the previous year. With investor interest increasing again, they see it as an opportunity to strike while the iron is hot and ramp up their outreach efforts once more.
The fund is 75% institutional, managing money from a pension fund, as well as an investment and private bank. While their number of clients has grown significantly, the fund is fully committed to maintaining its upwards trajectory.

“It's extremely important to keep communicating with new potential investors,” says Aaron. “There might be ebbs and flows in terms of performance, but you always need to be developing relationships that might be a good fit a year or 18 months on.”

With this advice in mind, Breakout Funds is happy to recommend Preqin: “If you’re a firm that’s committed to building assets and growing your contact list – Preqin absolutely delivers the value you need,” says Aaron.

About Breakout Funds

Breakout Funds is an opportunistic global macro strategy based in Chicago, Illinois. It incorporates quantitative global macro thematic views with current news events to place discretionary short term concentrated trades in futures markets.
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