How your choice of manager shapes portfolio outcomes

Great partnerships change outcomes. Ask anyone who remembers 3 December 1967 at Groote Schuur Hospital in Cape Town. The first human heart transplant was not a solo miracle. It was the product of a surgeon working in lockstep with anaesthetists, nurses and perfusionists under clear protocols. Roles were defined. Communication was crisp. When pressure rose, the plan held.

Manager selection in alternative investments requires the same discipline. It is not about who has the loudest pitch or the glossiest slide deck. It is about choosing a partner whose character, capability and context fit the task. In private markets the return spread between top and median managers is wide. The difference compounds for years because it shows up in when and where capital is deployed, how cash is generated and whether value is realised, not just modelled.

What, then, are you looking for in a partner?

Firstly, trust that is visible. In our world, trust is not a decorative word. It is alignment you can verify and governance that behaves the same on a good day and a bad one. It is a process that narrows the room for bias and a culture that shares difficult news early. Second, an edge that rivals cannot simply copy. Origination networks built over decades. Operating partners who will take your call. The ability to price risk correctly because you have lived it before. Third, a real opportunity set. A clever strategy in a thin market is a road to nowhere. The best managers operate where the pipeline is both deep and bankable and they can prove it.

These tests must hold across the full investment cycle. Pipeline origination is where discipline starts. Savvy managers source opportunities where competition is thin and information is asymmetric, then pass on deals that only work in an environment of price momentum. Capital deployment is a choice. There are times to move quickly and times to wait. Exits are planned, not hoped for. Plans are made at entry with more than one door out.

Performance differentiation in private markets

Managers working in the same environment can deliver very different results because of how they originate, price, operate and exit assets. The spread is stark. About three quarters of managers return below 15% IRR while only a small minority break above 30%. That gap reflects repeatable pipelines, disciplined entry terms, multi-lever value creation and exit design from day one. The chart below shows why partnership and process matter.

Tested processes and governance are the silent advantage. Independence at investment committee. Valuation controls that do not buckle. Real-time portfolio monitoring that escalates issues early. These are not back-office boxes. They are how loss ratios stay low and distributions stay steady. They are also how a platform learns. In alternatives you will face construction delays, bottlenecks, supply chain shocks or interest rate moves that break old assumptions. What separates good managers from bad ones is how quickly they adapt to these changes, bring in independent advisors and change teams where necessary.

Why impact matters in investment

Impact matters because it is a risk management tool, and not merely an add-on. In infrastructure and real assets, community acceptance and measurable improvements in safety, energy use or service quality make cash flows more durable. Projects with legitimacy face fewer stoppages and steadier volumes. If two deals offer the same return, the one with better proven impact is often represents the safer cash flow.

This is where we, as Old Mutual Alternative Investments have built our house. We have spent decades as a partner to South African retirement funds, backing assets that people use every day while holding ourselves to global standards. On the infrastructure side, AIIM’s IDEAS Fund has operated through cycles with teams on the ground. The advantage is not a single transaction. It is repeatability. A proprietary pipeline in power, roads, fibre and logistics that provides a clear line of sight as to what will be invested in going forward. Portfolio construction that blends operating assets for yield with growth projects where risk can be priced and managed. Practical liquidity in an asset class too often caricatured as illiquid. Members see roads maintained, schools improved, electrons on the grid. That visibility strengthens confidence in the asset class itself.

The Old Mutual Alternative Investments playbook

Across all our capabilities, the playbook is the same with different tools. We pursue deals where we can bring more than a return by adding operating know-how and alignment. We back strong management teams and empower them to execute their plans with several levers: organic top line growth in expanding markets or by taking market share, cost rationalisation where bloat exists, disciplined buy and build to create scale and lower the blended entry multiple, and professionalising people, processes and systems so the next owner pays for the platform we have built. Our governance is institutionalised rather than partner dependent, so succession does not change outcomes.

We also design the exit up front by mapping the likely buyer universe and shaping the assets to fit it, whether that is a strategic acquiror or another private markets firm.

We have made mistakes. Every serious platform has. We have invested through operating challenges and macro turns. We learned and priced risk more conservatively where evidence demanded it and improved how we monitor and intervene. The point is not perfection. It is progress you can verify in processes, behaviour and results.

Why partnership matters now

Why does this matter now? Because South Africa needs long-term capital deployed into productive assets and institutional investors need return drivers that work through cycles. Alternatives provide real economy exposure and steadier income when listed markets are choppy. But they only deliver if the partner is right. Choose managers who can show their homework, defend it under cross-examination and repeat it under pressure. Choose teams with local presence and global discipline. Choose governance you would trust with your own savings.

We do not claim to be the only credible house. We do claim a model that has been tested, adapted and shown to work in our market with partners who know us well. Our edge sits where it should: in origination that others struggle to replicate, in operating discipline that travels across sectors and in governance that protects capital when the wind turns. That is what we mean when we say partnership.

In an operating theatre the outcome reflects a thousand quiet decisions made long before the first incision. In private markets the investors’ outcomes reflect the same. Get the partnership right and the compounding takes care of itself.