Perennial Value Management will develop its next generation of investment managers by setting up a boutique within a boutique.

Perennial Value, part of Perennial Investment Partners, has set up Perennial Value Smaller Companies by using equity as an incentive to staff who may otherwise be tempted by offers elsewhere.

The group has been developing the structure for the best part of three years, Perennial Value Management managing director John Murray said.

"We've tried to be a littlie innovative and think outside the square and do something that no-one else has done in Australia before," Murray said.

"We've got some good talent coming through, that have proven their worth and we are providing equity for them."  

Grant Oshry, who has been with the group since 2003, is lead portfolio manager. Oshry will be joined by equities analyst Damien Cottier.

"We are fully resourced in terms of the capability but we've set aside enough equity for three people," Murray said.

"That equity could be available to either these guys, for someone that we pull through from inside Perennial Value, or for someone externally who isn't happy where they are."   

The new structure, which is targeting both retail and institutional investors, has raised $100 million in institutional money since the group's June inception.  

Perennial Value has managed a small companies product since March 2002.

Perennial Investment Partners comprises a suite of six investment management boutiques, built on the basis of sharing equity ownership with their investment professionals.

The group invests more than $20 billion on behalf of wholesale and retail clients.