In the past quarters or even years, it has been well publicized that first-time funds are experiencing what some describe as a nuclear winter when it comes to fundraising. It makes perfect sense that if relatively more seasoned funds with some semblance of a track record are having trouble raising subsequent funds, then first-time vehicles […]
During a mentoring conversation a few days ago, a young investment research analyst asked me how I determine a GP’s true motivations and evaluate whether these motivations are suitable for the long term. These questions are almost poetic in their deep simplicity, but quite complex to excavate. Any analysis of a GP or sponsor is
Product expansion is or will almost certainly be (at some point in the future) a real consideration for every GP who launches a maiden fund. From a business perspective, product proliferation makes a lot of sense. If you possess the people, processes, and data whose combination has been proven to create value, why wouldn’t you
A GP’s Family of Funds – Product Proliferation Musings Read More »
Consultants of all kinds have long understood that the fastest way to incur client displeasure is by making absolute statements. Human beings are wired to gravitate towards certainty, so promises or assertions of sureness from those in “expert” positions will generally attract attention, and with attention always comes increased scrutiny. It would be impressive if
Bombastic GP Statements That Draw More Attention Than Needed Read More »
All allocators who have been playing this GP due diligence game for a while have a memory bank of legendary stories that can be booted up at the drop of a dime. These stories (without divulging actual names, of course) are usually reserved for “you would not believe what happened today” conversations with spouses, enticing
LP/GP Horror Stories, Meltdowns and Crash Outs Read More »
When investment managers meet with potential investors, it is common knowledge that these investors are evaluating more than merely the manager’s strategy. They are also evaluating the organic atmosphere in the room, the level of mutual respect, the rapport among the GP team members presenting, the manager’s openness to various questions, the manager’s willingness to
One very common reason LPs “say” they chose not to re-invest (re-up) in a fund or to completely reject establishing a new relationship with a GP is “style drift,” a catch-all phrase that describes managers’ deviation from their pre-stated strategy. “Style drift” has been used so frequently in manager-critique situations that its original significance is
GP Style Drift – I Can’t Tell Who You Are Anymore Read More »
Recently, I’ve been reflecting on how someone can age gracefully in a career. With AI incessantly and intimidatingly banging at everyone’s intellectual door, it is impossible not to think about one’s own vulnerabilities. It is natural to ponder what weaknesses can be found in the intentional and happenstance fortress of skills we have individually developed
Have You Seen This Before? – The Paradox Of Familiarity Read More »
Last week, a shotgun due diligence I conducted on a fund approximately 13 years ago randomly came to mind. The manager was raising its third fund and had already hit its stated target. However, the fund had no hard cap, and five weeks remained until its scheduled final closing. Recognizing the tight timeline, which we
How Can A GP Salvage An LP Relationship? Read More »
There is undeniable exhilaration when an LP/GP relationship is consummated with an initial commitment. The future holds so much promise. The union feels like a whiteboard with boundless possibilities. Everyone is on their best behavior. Everything is fresh and innocent and devoid of negativity. This honeymoon period can last weeks, months, or even years (in
As LPs, How Punitive Should We Be To GPs? Read More »
