I was fortunate enough to have a beer with Joe Greco the other day. He is one of the best executive coaches out there. (If you are in the asset management business and want to up your game, it is a smart call to make).
During our dialogue, Joe hit me with a thought so astoundingly profound it was the mental equivalent of a strong uppercut to the jaw. His words,
“The problem with the industry is that they focus on “closing capital”, not “opening a relationship.”
Joe was right, this is exactly what happens, asset managers see “getting the money” as the prize. Think about how different the situation would be if an allocation from an institution was viewed as the beginning of something, the first opportunity to build a deep and lasting professional friendship.
Presently, closing capital is akin to falling over the finish line of a marathon. And before you light me up, I get it, raising capital is an extremely arduous process, yet there are those that can run a marathon 3 times over without a problem. You just need to train differently, more to the point, think differently.
Look at the “close” of the capital as the halfway point. A rock solid relationship that can survive the most volatile markets should be considered the end. Re-envision what happens after getting an allocation. Are personalized thank you letters sent? What commitment is made to communication? In short, the moment you “close” an allocation, what changes? I can assure you a hell of a lot should.
It’s an opening, not a closing.