The ideal situation is a firm that is founded on one or more strong investment analysts / portfolio managers that have built a team of talented and disciplined individuals around them that are slowly moving into the day-to-day responsibilities, ensuring a smooth transition. It is in this way that firms such as Tweedy, Browne & Company in New York have managed to turn in decade after decade of market-crushing returns while having virtually no internal upheaval. Another good example is Marty Whitman and Third Avenue Funds, the organization he built and continues to oversee.
Finally, you want to insist that the managers have a substantial portion of their net worth invested alongside the fund holders. It’s easy to pay lip service to investors but it’s a different thing entirely to have your own capital at risk alongside their's causing your wealth to grow, or fall, in proportional lockstep with the performance of your funds.
