Our thinking Quick reads Create real relationships – Raise more capital
 
Loud & Clear
September 2021
2 min read

Create real relationships – Raise more capital

Share
Download Print
A A
Text size

I don’t know how many people have told me that raising capital is about relationships. This is indeed true. In the majority of cases, no investor (regardless of the form they take) is going to invest without feeling they have a genuine relationship with the team they are allocating to.

The real question most GPs need to ask themselves, “Am I forming real relationships?”

More often than not, the answer is no!

A click is not representative of a relationship, someone joining a webinar is not representative of a relationship. A true relationship requires a mutual feeling of respect and a genuine concern for another’s wellbeing – and, yes, I am talking about a “good” relationship.

And this is the art of good marketing and brand building. The CEO of Nike or BMW is not personally connecting with everyone who buys shoes or vehicles. Marketing and brand building is designed to nurture and foster relationships. Corporations accomplish this by demonstrating that they can relate to the trials and tribulations that their existing and prospective customers face. They take positions on controversial topics to demonstrate awareness and understanding – climate, politics, etc. People like to gather in like-minded tribes.

My point to all of this, asset managers need to reach beyond talking about returns. Say something meaningful, show true empathy, don’t suck every dollar out of every situation, etc. In doing so, LPs won’t immediately redeem when performance dips, you will get the allocation when your performance isn’t the best, and re-ups will occur more often.

Friends don’t immediately abandon friends.

Share
Download Print
A A
Text size
Get email alerts for tailored content on your favourite topics
Sign up to email alerts

Browser Compatibility Notice

Welcome to MJ Hudson. Please note, this website will not function as intended on Internet Explorer.

For the full experience, we recommended viewing this website on a modern browser, such as Edge, Google Chrome or Mozilla Firefox.

Share this page using the options below