3 days ago
How Customized Fund Admin Helps Alternative Investment Fund Managers
Bottom row left to right: Stephanie Henwood-Darts, COO and managing partner, and Paulette ... More Fireston, CEO and managing partner of Phoenix Fund Services. Top row Jamie Heo, managing director.
In a market increasingly shaped by consolidation, offshoring, and automation, Phoenix Fund Services is betting on a different strategy: personalized, high-touch fund administration for private equity, venture capital, real estate, and other alternative asset classes. Founders Paulette Firestone and Stephanie Henwood-Darts describe Phoenix as being born out of frustration with how fund administration had become increasingly commoditized.
They launched the firm in 2023 to serve emerging managers who have been historically overlooked. They focus on customized solutions and genuine care. As client Kate Nevin of TSWS explains: "In an industry that continues to consolidate and become commoditized, I was impressed with how service and customized solutions are a priority at Phoenix. I want my fund admin to feel like an extension of my excellent back-office team, not a chatbot with a one-size-fits-all approach."
As of 2023, the global Alternative Investment Funds (AIF) market was valued at approximately $12.8 trillion and is projected to more than double to $25.8 trillion by 2032. This dramatic growth signals a corresponding surge in demand for fund administration services, particularly given the operational complexity and regulatory scrutiny that characterize alternative investments. Fund administrators play an essential role in supporting private equity, hedge funds, venture capital, and real estate funds by managing accounting, compliance, and investor reporting.
Key drivers behind the sector's expansion include the growing popularity of alternative assets among high-net-worth individuals, increasingly complex global regulations, and advances in fund accounting technology that improve operational efficiency. Additionally, the trend toward outsourcing back-office functions has made third-party administrators indispensable to asset managers seeking to concentrate on investment performance.
Over the past decade, the fund administration industry has experienced consolidation. Large financial services firms have absorbed smaller administrators, often driven by private equity investment and the promise of increased margins. This shift has led to widespread offshoring of operations, high employee turnover, and a decline in service quality.
"You start with a smaller firm that focuses on partnership, and suddenly you're being serviced by a global firm focused on margins," says Henwood-Darts. "Client service becomes secondary."
Phoenix Fund Services was established in direct response to the erosion of accountability and partnership. Rather than offering fixed service packages, Phoenix builds tailored solutions that scale with clients as they grow.
A Phoenix Fund Services team member showing a report to a venture capital client.
Phoenix intentionally set out to support emerging fund managers, particularly those who have been historically overlooked. As founders representing some of these groups, they recognized a gap in support and sought to fill it with services that were both affordable and of high quality.
"We created Phoenix to be a safe space for managers who aren't typically prioritized by large service providers," says Firestone. "But we quickly learned that our model resonates with everyone, because everyone wants to feel like they matter."
That emphasis on care and adaptability has made Phoenix a favorite among smaller and mid-sized funds that value responsiveness. Henwood-Darts emphasizes that their clients often don't know precisely what they need when they start. That's where Phoenix steps in—not with a rigid menu of services, but with experienced professionals who ask the right questions and help shape back-office solutions.
"Some clients want to be involved in every step; others just want to focus on growing their fund and let us handle the operations," says Henwood-Darts. "We adapt to their style rather than forcing them into our system."
"We have a great relationship with the Phoenix team; they're sharp, responsive, and actually care about our success,' Kelly-Ann Winget of Alternative Wealth Partners puts it plainly. 'That shouldn't be rare, but it is. They treat our fund like it matters, not like we're just another account on the books."
Breaking into the fund administration space wasn't easy. As Firestone notes, the industry values tenure and legacy. Phoenix had to build trust from scratch. "We had to show that being new didn't mean being inexperienced," she says. "Our team has decades of experience, and we invested heavily in best-in-class technology."
To build credibility, Phoenix focused on increasing visibility by attending industry conferences, establishing referral networks with fund formation attorneys and tax advisors, and publishing thought leadership content on LinkedIn. Most importantly, they let their work speak for itself.
"Our first clients were the hardest to win," Henwood-Darts admits. "But once we delivered, they became our biggest advocates."
Another differentiator is Phoenix's talent strategy. With strong industry networks and a commitment to representation, the firm handpicks experienced professionals, often individuals with whom the founders have previously worked. Equity ownership helps retain those professionals and aligns their success with that of the firm.
"People-issues are the number one challenge in this industry," says Henwood-Darts. "We're solving that by making sure our team feels invested in our success."
Phoenix Fund Services was founded with a mission to serve a specific niche of emerging and overlooked managers. But as they grew, the founders discovered that high-touch, personalized service is a universal need. The firm's success is proof that fund administration doesn't have to be cold or commoditized. It can be collaborative, customized, and deeply human. In a world where fund administrators often operate like chatbots, Phoenix stands out by operating like a true partner.
