🤕Problem
Fund Management Inefficiency and Opacity.
What problem is Fume solving?
We are solving the inefficiency and opacity in the fund management industry.
Inefficiency
Too Many Intermediaries. To deploy an investor's capital, the subscribed funds go through multiple intermediaries such as the subscriber's bank, clearing settlement companies, the Fund's bank, and the broker/exchange bank, to name a few.
Expensive Administration. Setting up and running an investment fund is extremely costly and time-consuming for Fund Managers. The reporting between the Administrator and the Managers requires tiresome and error-prone manual work.
Opacity by default.
Trust. The investors have to trust the manager to respect the offering memorandum terms, to trust the administrators that all the NAV and fees are calculated correctly, and that the Custodian of the underlying assets remains solvent.
Expensive Audits. Every financial year, the Fund must pay auditors to provide transparency and ensure the execution of the investment strategy according to its memorandum.
How did you discover this problem?
The need for the Fume protocol comes from the direct pain we have experienced managing our own investment fund in traditional finance (an alternative investment fund based in Luxembourg).
How was this problem solved in the past?
In the past, other solutions tried to solve this problem incrementally, by optimizing some internal investment management processes. Software-as-a-service tools to better connect different banks and brokers, reporting tools to automate administration. Instead of improving pieces of the existing model, Fume uses blockchain technology to rebuild it from the ground up. It allows for a way simpler model, that doesn't have all the bloat and complexity of years of organic growth. This approach is also completely compliant with existing regulations in top-notch jurisdictions. This allows the creation of a new standard for the fund management industry.
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