All alternative investment marketers encounter moments within the normal course of business that we recognize to be solid anchor points, things that we should remember to remember.
LPs are not gods. It goes without saying that you need to be respectful at all times. The same applies for LPs. They shouldn’t lord their position over you. If you aren’t being treated with respect, walk away.
Data rooms are where most LPs go to die – make sure yours is organized and well structured. More importantly, control how LPs access and interact with your data room. If used properly, a data room is an exceptional place to qualify interest.
Just because an LP asks for something, doesn’t mean you need to give it to them. Remember, you are in control of the process, not the prospective LP. For example, if an LP hasn’t seen your deck, you can easily say, “That document is a beast, best review our deck. If interest persists, I can send the PPM.”
Point 4 somewhat relates to point 3, but have a process. It is best if you move LPs through a sales funnel in a coordinated manner. This is the only way you can accurately gauge interest and leverage one LP to close another.
Limit the amount of information you provide in any one interaction – get in and get out. LPs are incredibly busy. If you are allotted an hour, that doesn’t mean you need to take the whole hour. It is best to be concise and organized. Pre-plan what you are hoping to accomplish in a meeting or on a call, accomplish it, and close the meeting. More is not better.
Don’t practice on prospective investors. Senior executives across the industry tend to snub their nose at role play. My advice… do a lot of it. Sales is as much of a skill as anything else.
Communicate as much as possible to as wide of an audience as possible. I have spent a lot of time “marketing” to different audiences. Whether you intend to or not, you are likely to make assumptions as to who will engage and not engage. In my experience, this is extremely hard to predict. If you are communicating to a wide audience, you can respond to interest wherever it arises.
Marketing is no longer a manual process. Let me be clear, a human touch will always be required to close an allocation, however, it is all but impossible to rely solely on one-on-one conversations to qualify interest at the top of the sales funnel. It is now much more efficient to communicate en-masse and profile interest using technology at the outset of the process.
If someone asked why they should invest with you, best have a damn good answer. No, I am not being facetious here. It is amazing how few GPs can concisely answer this question.
Be nice! Yes, I am borrowing this from Patrick Swayze’s character, Dalton, in the movie “Road House,” but it is great advice that we sometimes forget. That is until it is time to not be nice.