Like most other products and services, hedge funds seek branding advice from specialists.

Hedge funds have seen one of its worst quarters at the end of Q3 2011, dropping 6.2 percent for the quarter, according to the HFRI Fund Weighted Composite Index. As investors flock to safety, they also are flocking to name brand hedge funds with large assets sizes, and established reputations.

“Since the market correction of 2008, a vast majority of hedge fund net asset flows have gone to a small minority of hedge funds with the strongest brands, marking a change from the pre-2008 environment,” said Don Steinbrugge, chairman of third party marketing firm, Agecroft Partners.

“A high-quality brand takes a long time to develop, but once achieved, it significantly enhances a firm’s ability to raise capital and retain assets during a drawdown in performance.”

For hedge funds, especially starts up less than 200 million in assets, branding efforts are left up to the professionals—third party marketing firms. Yet, the “Top 30” firms in this arena do not always welcome hedge fund starts ups as potential clients.

“The Top 30 third party marketers are inundated with requests and they represent less than one percent of the industry,” noted Steinbrugge. “They’re good at what they do, and the demand for their services is higher than the supply.”

While most of the industry is comprised of “lower quality” third party marketers trying to solicit business from hedge funds, it’s very much a two way street. “It’s not easy to get third party marketers to represent you; you need to have a solid product offering and good track records,” Steinbrugge told Markets Media.

As one might suspect, hedge funds internalize marketing efforts as they grow—mainly those that exceed one billion in assets, noted Steinbrugge. Yet, start up hedge funds which are successful from the get-go may internalize a chief marketing officer, as well as a portfolio manager, trader, and compliance officer, noted Steinbrugge.

“Although larger hedge funds rely on in-house marketing, firms use a combination of third party marketers to cover different geographic areas, or a specific investor type—such as sovereign wealth funds, pensions, endowments and foundations, and family offices.”