(Bloomberg) — Strive Asset Management, the anti-activism fund company founded by Republican presidential hopeful Vivek Ramaswamy, has surpassed $1 billion in assets despite being under regulatory scrutiny.
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Ohio-based Strive manages these assets across its 11 exchange-traded funds, just over a year since the first fund began trading, according to a press release Tuesday. It launched in 2022 with the backing of billionaire investors, including asset managers Peter Thiel and Bill Ackman, as opposed to investments such as BlackRock Inc.
Strive’s mission statement — to encourage companies to “focus on the bottom line” rather than the ESG mandate, according to a release Tuesday — appears to be resonating as appetite for ESG investors dries up and corporate advocates, including BlackRock’s Larry Fink, back away from the phrase. Ramaswamy’s presidential bid is drawing more, if not more, eyeballs to the Strive line, Bloomberg Intelligence reports.
He is currently ranking third in the Republican primary — behind Donald Trump and Ron DeSantis — in the Real Open Politics polling average.
“It’s rare for any indie issuer to hit $1 billion in its first year, let alone a big push for ESG,” said Eric Balchunas, senior ETF analyst at Bloomberg Intelligence. This is uncharted territory when it comes to ETF trading.
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Strive’s biggest hit was the $369 million Strive US Energy ETF (ticker DRLL). However, DRLL’s selling point is that Strive uses its shareholder voting power to encourage the companies it owns to “cancel more and break even more,” Ramaswamy said last August.
Besides DRLL, the largest and oldest ETF, the $267 million Strive 500 ETF ( STRV ), led the way this year with $147 million in revenue, followed closely by $147 million for the $153 million Strive Emerging Markets ex-China ETF ( STXE ). Strive last month launched two fixed-income ETFs from equity-only funds.
But Strive’s exit has come with some setbacks. Two former employees have filed lawsuits against Ramaswamy and co-founder Anson Frericks in recent months for allegedly harassing employees and pushing employees to violate safety rules. The company said in a statement to Bloomberg last month that it “intends to defend itself vigorously.”
Trive could face headwinds as companies such as BlackRock move to give investors more voting power at shareholder meetings during the 2024 proxy season, Balchunas said.
“Big companies like BlackRock and Vanguard are starting to democratize the selection and let the ultimate investor decide, which removes some of the arguments that they are choosing everyone’s shares in an ESG way,” Balchunas said.
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