FocUS: In Conversation with Mark Cleary

Welcome to FocUS, our new interview series centred on the US market.

In this inaugural feature, Philip Pirecki, our Americas Lead, chats with Mark Cleary, Director at ZEDRA.

Read on to:

• Discover how Jersey’s regulatory and legal framework facilitates access to European and other international investor markets for US fund managers.
• Get insights into some of the most pressing challenges for US fund managers – and their greatest opportunities over the next three to five years.
• Read Mark’s recommendations for Jersey financial services providers looking to develop business opportunities in the States.
• Find out how Mark unwinds and recharges, away from the office, and what he feels Jersey has to offer away from the world of finance.

Who are you and in which areas do you specialise?

I’m the Deputy Head of ZEDRA’s Channel Islands funds service business. I regard myself as a specialist generalist, with touch points across a number of business areas on a day-to-day basis that require deep industry knowledge and expertise. However, my focus areas are fund governance, strategic relationship management, and I have a keen interest in AI and blockchain technologies.

Is ZEDRA’s US Funds business concentrated on the East coast?

ZEDRA has coverage on both the East and West coasts of the United States. We also have core capabilities out of Charlotte, North Carolina, and more recently Cleveland, Ohio, with the team from Gryphon joining us in late 2024 – doubling the size of our fund administration business. The US remains a key market for us, and we continue to expand our local footprint and client base.

What are the primary drivers shaping the global funds space from Jersey’s perspective (e.g. regulatory changes, digital assets, client demands, geopolitical changes, etc.)?

The short answer is: all of the above. We are living through a period of significant and rapid change, and most industry participants are grappling with a myriad of shifts in the market. Take digital assets, for example: the underlying technology is now more widely understood and its use cases and ecosystem continue to expand. The key challenge for the traditional finance industry is to determine how it can harness decentralised technologies – and their associated digital assets – for the benefit of clients, in a commercially sound way.

What are the most pressing challenges for US fund managers and how does ZEDRA help to solve these?

We focus on getting the basics right for our clients, so they can implement their strategies as seamlessly as possible. When it comes to challenges, these depend on the manager and their investment strategy – and will inevitably vary from firm to firm. I think it’s fair to say that all US fund managers will primarily be interested in value creation through their investment performance, and less concerned with the nuances of operations and compliance. Our role is to make the administration work invisible, allowing them to eliminate this noise and focus on what is truly important to them.

Based on your position, where do you see the greatest opportunities for US fund managers over the next three to five years?

The basic function of any manager is quite simple: to raise capital and deploy it for the benefit of investors, while generating a profit.

One of the greatest opportunities for US fund managers lies on the capital raising side, via the ‘retailisation’ of private markets. While this trend has been spoken about for some time, momentum is building, and if the risks can be properly managed, it represents a very large pool of capital to access and deploy.

This intersects with the growing concept of tokenisation, where much of the value creation will naturally be captured by asset managers. Combined, these two opportunities provide significant ‘blue water’ for US managers over the next three to five years.

It would also be wise for US managers to maintain a diversified investor base, and securing fresh capital from the UK, Europe and Switzerland should be seen as a strategic priority. And, with its robust regulatory framework, political, economic, and social stability – alongside sophisticated financial infrastructure – Jersey remains an ideal jurisdiction for establishing a vehicle and putting capital to productive use.

Are there typical fund structuring solutions for different asset classes (e.g., private equity, venture capital, hedge funds, real estate) when working with US managers?

The Limited Partnership structure is the most common vehicle that we see in private markets (including Real Estate) and we don’t expect this to change in the foreseeable future. Hedge funds, by their nature, tend to be more open-ended – allowing investors ‘in and out’ on dealing days – so incorporated vehicles tend to be better suited to this structure.

Jersey offers a wide variety of options for US managers – not just in terms of vehicle options, but also due to its flexible regulatory regime – and this is important to keep in mind.

How does Jersey’s regulatory and legal framework facilitate access to European and other international investor markets for US fund managers?

In every conversation I have, Jersey’s legal and regulatory framework stands out as the crown jewel in our offering to international clients. The story we can tell is powerful – one that connects an extremely rich history with a present that is vibrant, forward-looking and innovative.

Our legal framework and political stability are essential to protecting property rights, making them a major selling point for the Island. In addition, our approved third-country status with the EU is also vitally important to accessing EU capital.

While having these attributes is well and good, the onus rests on local industry to ensure we tell this story as effectively – and as widely – as possible. Jersey Finance also plays a crucial role in this too.

What would you recommend to US-based fund managers considering Jersey for their fund structuring or wealth planning needs?

Aside from speaking with ZEDRA in the first instance, I think there are three additional points US managers should consider.

Firstly, they should engage (early) with one of the many expert fund structuring lawyers in Jersey, who are often their entry point into the jurisdiction and its financial system.

Secondly, I would encourage them to spend some time understanding their legal and fiduciary duties on Jersey boards, as well as the broader regulatory landscape.

Finally, if they have the means, I would strongly encourage a visit to the Island to get a true feel for what we represent.

What about Jersey providers looking to develop business opportunities in the States?

Seeking business from the US isn’t for every service provider on the Island, but for those who choose to enter this market, there are a few things I would recommend.

The quickest and most cost-effective approach is to leverage any connections you already have within your Group to US-based contacts. Second, I would suggest building your network with US lawyers based in London, as they are often a key vector for new business flowing from the US into Europe.

Finally, it would pay to spend time on the ground in key US cities to expand your network – and in this regard, Jersey Finance can provide valuable assistance.

Ultimately, I would say that persistence is key. Don’t expect an avalanche of new business from one trip alone. As with most things worth pursuing, time, consistent effort, and an element of good fortune are crucial to uncovering promising opportunities.

Your working life is a busy one. How do you unwind and recharge?

I like to walk in the countryside or on one of our glorious beaches. We have a relatively new puppy in our family, Bobbi, so this gives me plenty of opportunities to get some fresh air and recharge. I also love to travel and read, so you might find me in the library or in an airport near you.

Aside from Jersey’s award-winning international finance centre, in a few words, what else does the Island have to offer?

Well, Jersey is steeped in history and culture, and is a charming and extremely welcoming Island. It has a so many attractions for visitors but if I had to single out one attraction, it would have to be the Jersey Zoo.  Their grounds are stunning, and the conservation work they undertake is vital to protecting endangered species, worldwide.

No part of this Q&A constitutes legal, tax, investment or regulatory advice and it may not be relied upon as such. The statements contained herein are of a general nature only. No representations as to the suitability or otherwise of Jersey as a jurisdiction for any specific fund, fund manager or investor are intended. Appropriate advice should always be taken. Fund services are subject to regulatory requirements and market risks.

If you’re interested in taking part in our FocUS interview series, please contact us.