GlobeOp: Enabling Hedge Funds, 2000-2003 (A)

GlobeOp: Enabling Hedge Funds, 2000-2003 (A)

By
Glenn Carroll, Victoria Chang, David Modest
2008|Case No.OD6A

GlobeOp (http://www.globeop.com), headquartered in New York and London, was an independent financial technology firm focused on providing outsourced middle- and back-office operations capabilities, and fund administration and risk reporting services to hedge funds and their investors, including fund of funds, institutional investors and family offices.

The founders of GlobeOp endured typical start-up challenges that included endless hours, technical challenges, management issues, strategic disagreements, resource issues, and financial insecurity. But by December 2003, GlobeOp had grown to nearly 400 people, serving 86 clients representing $29.6 billion in assets under management (AUM). Moreover, GlobeOp had done so well that it had attracted the interest of a broad range of potential investors and competitors. Ultimately, in the Fall of 2003, GlobeOp’s initial partners decided to sell a minority portion of the company to TA Associates, a private equity and buyout firm, for $82 million. TA Associates had been attracted to GlobeOp because of its instrumental role in transforming the hedge fund industry. But despite its early successes, the GlobeOp founders did not want to rest on their laurels. They wondered how best to take advantage of the company’s platform, as well as how to maintain GlobeOp’s market leadership position going forward.

Learning Objective
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