Honing Your Presentation Skills
At a time when the fundraising cycle is getting shorter and shorter, one aspect of the process that typically doesn’t get its due share of attention is a GP’s presentation ability. It is no secret that GPs are facing a crowded and competitive marketplace for LP dollars, so being able to effectively and persuasively tell your story is often as important as the story itself – and worthy of putting serious thought into at every stage of engagement with an LP.
There are three key steps to a good presentation. The first step takes place before the presentation – how carefully you prepare. Look to get as much information about the LP you are meeting – not just their program institutionally, but also the specific people that you will be meeting. Your advisor will likely have a great deal of familiarity with the team that you are meeting and will be a great resource in this regard. Ideally, you should enter the meeting armed with insights into the LP’s program, such as what their target allocation is to your strategy or asset class, whether they are over- or under-allocated, what their appetite is for co-invest, how much they typically look to invest, etc. Don’t just stop there – look for information on the specific people you are meeting. Beyond the obvious overlaps in prior firms, colleges/universities attended and so on, a keen eye from your advisor will allow you to find other points of connectivity. Maybe you both played baseball in college, volunteer at the same non-profits, or are from the same hometown. Never underestimate how far a solid personal connection can get you in terms of starting off on the right foot.
The next step, of course, is the meeting itself. Make a good connection at the start of the meeting but stay sensitive to the LP’s body language here. Some LPs will appreciate small talk at the beginning of the meeting to establish a personal relationship, while others will be itching to get down to business. In any case, there is no substitute for being personable and engaging. Remember that LPs take meetings with GPs all the time, so being memorable can go a long way towards getting traction after an initial meeting. On the presentation itself, one trap that we have seen too many GPs fall into is to lose the forest for the trees as it relates to a particular aspect of their story. Before the meeting, determine which three or four key points you want the LP to walk away with (momentum, liquidity, ample co-invest, operational excellence, etc.) and ensure that you emphasize them appropriately. On a similar note, anticipate questions that the LP might have and develop a script for key points you want to cover in each answer. At the conclusion of the meeting, remember that a soft sell is always better than a hard sell. Do not – directly or indirectly – ask them what they thought of the meeting, what milestones they see on the path to making a commitment, or any sort of “post mortem”. Reading body language is again important here, and your advisor will follow up for specific information in a more organic setting later on.
The final step is following up after the meeting. Immediately after the meeting, make sure to send a thank you note. It is a simple step that shows that you care and are focused on building a relationship with the LP – remember that throughout their diligence process, an LP is also evaluating what you will be like to work with as a partner. Always ask the LP who from their team you should add to the data room – this will often be more junior members of their team as opposed to the people in the room with you. Finally, when you follow up, make sure to have a material update to provide them with such as a new platform/add-on, a strong uptick in marks, co-investment opportunities, etc. It doesn’t work to simply ask them for their order – you must provide them with actionable updates that will give them a reason to pick up their pencils on your fund versus the countless other funds they are concurrently evaluating.
Ultimately, successfully closing commitments from LPs is as much about the quality of your interactions as it is about the quantity. Be thoughtful about how you engage the LP on a personal level, how you tailor your message to their institutional needs, and what updates you provide them to catalyze a commitment. Delivering a resounding fundraising presentation is as much about soft skills as it is about the actual story itself – and often LPs will take cues from how passionate, confident and engaged you are as a way to orient their own thinking about your fund and strategy.
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Sixpoint Partners, LLC, is a registered broker/dealer, member FINRA (http://www.finra.org) and SIPC (http://www.sipc.org). Sixpoint Partners Asia Limited is licensed by the Securities and Futures Commission (http://www.sfc.hk).