My personal experience for a first-time fund:

What LPs that invest in new / emerging managers want is

  • a strong warm intro AND
  • at least strong early results.

Weak intros don’t work. An investment thesis without results doesn’t really work.

And results alone are not enough, unless they are insanely good. Because there are too many managers out there that are 4x-5x+, at least as individuals.

But warm intros from other top managers … if they really vouch for you … and you have at least strong early results, is magic. And less common that you’d think.

Most GPs will not vouch for other GPs, not really. After all, they are competition. At least for LP capital, if not deals. In fact, most GPs will subtly recommend their LPs not invest in other managers. LPs can only manage so many managers.

So when a successful GP in an LP’s portfolio vouches for another GP, and says do it … which is rare … much rarer than one founder vouching for another to a VC … the LPs listen.

That’s the deal they want to do.

Of the 200+ new funds they are pitched each year. And the 0–2 new managers they will back each year.

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