Profile of Albourne Village, for the alternative investment community

I recently had a conversation with Sam Lewis and Ashton Mayne of the Albourne Village. We are adding this profile of the Albourne Village to our Social Software Site Guide. A similar, but much more exclusive, site that I profiled a while ago is the Value Investors Club.

Albourne Village

February 15, 2005

Website:

village.albourne.com

Summary:

Albourne Village is a completely free internet-based “knowledge economy” and virtual community for the alternative investment community. Among the noteable features of the site: hedge fund news; discussion around industry issues; jobs; and a directory of service providers in the industry.

Membership:

Nearly 25,000 users in 118 countries. The Village is growing by 40-50 people a day.

Launched:

Launched on Thanksgiving Day, 2000. Albourne seeded the community with 260 people: their clients, friends, and leading industry figures.

Founder/CEO:

The CEO of Albourne Partners is Simon Ruddick. The “Mayor” of Albourne Village is Sam Lewis, and Ashton Mayne is responsible for its day-to-day activities.

Corporate Overview:

Albourne Partners is the world’s largest advisor to hedge fund investors. Albourne Village is a separate nonprofit entity run by an affiliate of Albourne Partners. Albourne Partners is named after Albourne, a small ancient village in Sussex county (England).

Albourne Partners advise hedge fund investors on due diligence; manager selection; strategy timing; portfolio construction; and risk management. The firm is based in London and has approximately 50 clients and 50 staff. Albourne is the due diligence adviser to Standard & Poor’s, and also works for family offices such as the Ed Bass Group and endowments such as the University of California. They advise 3 of the top 30 fund-of-funds.

Fees:

Membership is completely free, and Albourne has no intention to change that. Albourne Partners believes that the marketing and name recognition benefits of running this unique online community are sufficient compensation to it. In addition, there are many informal benefits to them, e.g., passes to exclusive industry conferences. Anyone interested in alternative investments can be a resident, including students without previous work experience in the industry, although only sophisticated investors are allowed access to all areas of the site.

Description:

The Albourne Village is an unusual example of an online community successfully serving a busy, time-sensitive group: hedge fund investors and others interested in the sector. About ¼ of their members visit the site at least once a day, which is an extremely high usage rate vs. other online communities. About 85% of their members visit the site at least once per month. Much of that traffic is driven by members following up on news links in their daily newsletter.

The Albourne Village was listed in the Online Finance 40 in the March 2002 edition of Institutional Investor, and moved up to number 26 in the Online Finance 30 in the March 2003 international edition.

Albourne’s culture is friendly, with a dry sense of humor. , Their slogan is Don’t just join the Village, be the Village.” Part of the FAQ says, “The descriptions are of guidelines, not rules. It is envisaged that these guidelines will evolve over time. It is hoped that this will be as a result of a vibrant dialogue between those that we hope will come to care about such matters.”

The most-used features of the site are:

  • Village Pub – the “Bridge Inn” where Residents can accessing daily news, notice boards, question boards, and forums. Sample queries:

“I am looking for information on top European hedge funds by assets under management. Does anyone have any information (either Europe-wide or for individual countries) showing this, or know where it can be found?”

“We are looking for a software which could help us in selecting uncorrelated equities on the Nasdaq. Instead of comparing figures stock by stock in an Excel sheet, we would like to know which softwares exists allowing us to select for example "equities with a negative correlation" or stocks with a correlation coefficient of 2%.”

  • Library – current industry related literature, as well as research posted by other Residents wishing to sell their knowledge for Apples (more on Apples later)
  • Hedge Fund Mall — directory of hedge funds for perusal by accredited investors.
  • Job Centre – Anyone can post an industry related job vacancy or job wanted advertisement. One of the busiest parts of the site.
  • Business Centre — directory of service providers to hedge funds
  • Data Farm — includes Standard & Poor’s, MSCI, and HedgeFund Intelligence hedge fund indices. Also houses the Albourne Weather Forecast – a daily estimate of how conducive the prevailing underlying market environment is for a variety of hedge fund trading strategies.
  • Conference Centre – highlighting up and coming events
  • Village school — industry-related courses on offer

At the launch of the Village, every resident could communicate with every other resident. However, a few spammers made that openness unfeasible. Now people can opt at their discretion to be contactable. However, there is no easy way to search through the members’ database, so Albourne’s design is not as open to people directly reaching out to others as most online communities. You can view a member’s profile only by clicking on his user ID, if you see that that member has participated in the pub, is currently logged on the site, or has contributed some content to the site.

In general, it is very rare that Albourne has to delete someone’s comment in a chat room or delete a person’s account. Because Albourne targets a highly interlinked community of professionals, they do not attract many trolls.

A unique aspect of the Village’s design is the use of Apples. “The Apple is the internal currency used within the Village. It is fundamentally a medium of barter to encourage the free flowing exchange of information between the Village Residents.” You get 500 Apples upon admission to the Village, and can earn more by contributing content, commenting on others’ content, inviting new members to join, and also by giving money to charity. In practice, the only time that people actually pay cash for Apples is when they make a donation to the Village Church, and get Apples in return. The Albourne community has raised over $US350,000 since 2000. This is the rough equivalent of the feedback system used by Monster Networking.

You can spend Apples on purchasing content, the gift shop (T-shirts, etc.), or on charity.

Notes:

One of the themes of successful online communities is the importance of focus and of exclusivity. Albourne’s tight focus allows it to provide high value to its members by serving their unique needs.

The Village is not exclusive at all; anyone can join. However, because it is only marketed to a small community, and because of the privacy controls, its relatively open doors do not reduce the value of the system.

Recommendation:

If you have a serious interest in alternative investments, we recommend becoming a member. Contributing high-value content is probably the fastest way to meet people on the site.

Disclosures:

David Teten’s research company for professional investors, Nitron Advisors, and his executive recruiting firm, Teten Recruiting, are members of Albourne’s Business Center.