Online Reputation Management for Hedge Funds

Online reputation management is becoming increasingly important for hedge funds and other companies that want to raise capital. Often a single unwarranted negative comment is enough to make a prospective investor pass on what would otherwise be a very compelling investment. As a hedge fund manager or a CEO looking to raise capital, you can either fall victim to unwarranted negative press or you can rise above the negativity by employing an online reputation management service or bringing the online reputation management process in house.

Online reputation management is essentially an offshoot of traditional search engine optimization. The goal of SEO is to get a single listing, for example the url of your website to the top of the search engines like Google, Yahoo or Bing. Online reputation management is similar to SEO but is a lot more involved. The typically scenario is this: a disgruntled investor or a competitor posts an unwarranted negative article on their blog and this story attracts enough attention to rise to the top of the search engines and damage your reputation and turn away potential investors in your hedge fund or business.

You could do nothing as this negative publicity harms your business prospects or you could strike back with online reputation management.

What this would entail is essentially making sure that the search engines rate the positive things that people have to say about you more highly than the negative stories. (Now keep in mind that if people are saying bad things about your hedge fund because they are true, online reputation management would be a losing battle for you. It is only going to be effective if the negative publicity is truly unwarranted.)

Step 1: News Generation

The first step in online reputation management is ensuring that all of the good news about your hedge fund or company gets out. Often there is a lot of good news that simply goes unreported. Your job is going to be getting all of this good news out. When your fund does something newsworthy, issue a press release. When you have a relevant story, contact the top bloggers in your industry. And always utilize your own news outlets, such as blogs and social media. The real key is to tell your story in as many places as possible so that the word gets out.

Step 2: Promotion

Now that there is a lot of raw material in the form of good news about your hedge fund or company out there, the hard work of the second step is about to begin. The second step is promotion of all of the good news and buzz that was generated so that the search engines begin to rank all of the favorable news about your hedge fund or company above that of the unwarranted negative article. This is akin to standard SEO except now the goal is to get ten different urls ranked highly on the first page of the search engines instead of a single url. The reason you need to get ten different urls ranked is that this is the number of results displayed on the first page of the search engines. With online reputation management you will need to ensure that favorable news dominates all of these positions so that the unfavorable news story is pushed off the first page of the search engines where no one will see it.

Now, how all of this promotion of positive news occurs is beyond the scope of this article, but it entails the creation of positive references or links to the good news articles by search engine approved methods of reaching out to influential bloggers and websites and sharing your story to encourage links to these articles that showcase your hedge fund in a favorable light.

What to Expect

So as the online reputation management process starts to take effect. The unwarranted negative news about your hedge fund or firm will be slowly pushed lower and lower in the search engines and replaced my many favorable articles about you and your firm. Remember the negative effect of one unfavorable mention of your fund has at least ten times the effect of a single positive mention. So as the favorable stories start to overwhelm the negative one, you will begin to have a considerably easier time attracting more investors to your hedge fund or your business.

Now don’t expect online reputation management to be either cheap or easy. Traditional SEO is already an intensive and expensive process and online reputation management is roughly an order of magnitude harder, because ten search engine listings must be optimized instead of only one listing. You can try to do this in house, but if you are a hedge fund manager that his worth his salt, you are probably better served by looking for an online reputation management service provided by a well regarded SEO firm, and sticking to what you do best which is extracting alpha from the markets.