State of the Industry Series: Fund Selector Talk II-2025, Insight in What Selectors Want
Fund selectors and gatekeepers play a pivotal role in the investment ecosystem. They are the decision-makers who determine which funds make it onto buy lists and ultimately reach investors. In this article, we discuss how fund managers can increase their chances of success by presenting a clear, compelling, and investor-ready proposition.
In today’s competitive investment landscape, with a plethora of options—listed or non-listed, passive or active, ETFs or traditional funds—fund managers must go beyond simply offering strong performance to attract and retain investors. Fund selectors and gatekeepers, the decision-makers who determine which funds make it onto buy lists, are looking for more than just returns. It’s not just about showcasing performance or brand reputation—it’s about demonstrating a deep understanding of investor needs, offering innovative solutions, and delivering consistent value. They want to see a compelling, well-rounded proposition that aligns with their needs and stands out in a crowded market.
Based on insights from top fund selectors, here are six actionable keys to supercharge your fund’s proposition and capture the attention of investors. These actionable keys are not only directed at new or smaller fund managers but also apply to larger, well-established asset management companies.
Beware: each fund raise, regardless of your previous success, is a new story and a new venture.
1. Know Your Market: Understand Your Target Audience
The foundation of a successful fund proposition is a deep understanding of your target audience. Fund selectors want to see that you’ve done your homework and know exactly who your ideal investors are. Here’s how to get it right:
Define the Ideal Investor Profile: Start by creating a detailed profile of your ideal investor. Consider factors such as investment experience (sophisticated vs. beginner), risk tolerance (aggressive vs. conservative), investment goals (income generation, capital appreciation), minimum investment amount, and geographic location.
Segment Your Audience: Create distinct investor segments, such as capital conservation investors, growth-oriented investors, regulated institutional investors, or high-net-worth individuals. To further refine your understanding, develop distinct investor personas that represent different segments of your target audience. This will help you tailor your messaging and communication strategies for each group.
Why It Matters: Knowing your market allows you to craft targeted messaging, build trust, and differentiate your fund in a competitive landscape. Tailor your efforts to match their specific needs, requirements, preferences, regulatory restrictions and investment tine-line. This approach avoids broad, blind marketing, saving costs, resources, and protecting your reputation.
By clearly defining your target audience and developing investor personas, you can create a more focused and effective fundraising strategy. This will enable you to craft compelling narratives that resonate with potential investors and demonstrate how your fund aligns with their specific needs and goals.
2. Embrace Calculated Risk and Innovation
In a crowded marketplace, it's tempting to play it safe and stick to well-trodden paths. Too often, funds’ underlying assets are similar, simply replicating what already exists. However, fund selectors are drawn to managers who demonstrate the courage to take calculated risks and embrace innovation. This doesn’t mean being reckless—it means identifying opportunities before they become mainstream and having the conviction to act on them. Show that you are ready to explore new areas or revisit and improve existing ones. To achieve this, identify emerging trends, conduct thorough research, and prepare to present a compelling case for your innovative strategies. Don’t be afraid to be a pioneer. In practice, dedicate time to researching new, emerging, or underserved markets, products, or assets.
Why It Matters: Taking well-judged risks can set your fund apart, attract early adopters, and position you as a forward-thinking manager. It demonstrates a commitment to seeking out new opportunities and generating alpha for your investors. In a rapidly evolving investment landscape, innovation is essential for staying ahead of the curve and achieving long-term success.
3. Go Above and Beyond on Transparency: Build Trust with Investors
Transparency is not just about compliance—it’s a cornerstone of building trust with investors. Fund selectors appreciate managers who are willing to share more than the minimum required, going beyond standard monthly portfolio updates. To stand out, implement robust reporting systems, proactively share information, and be readily available to answer investor questions. Concretely, this means reviewing your investor reports and increasing the frequency, depth, and clarity of the information provided.
What Selectors Want:
Live Portfolio Access: Offer real-time or near-real-time access to portfolio holdings and performance metrics.
Willingness to Share Additional Information: Be open to providing insights into your investment process, decision-making, and risk management practices.
Clear Communication: Ensure that all communications—whether reports, presentations, or meetings—are easy to understand and free of jargon
How to Achieve This:
Enhance Reporting: Move beyond basic performance metrics to include detailed explanations of portfolio changes, market insights, and how your strategy adapts to evolving conditions.
Proactive Communication: Don’t wait for investors to ask questions. Anticipate their needs and provide updates on market developments, fund performance, and any changes to your strategy.
Open Dialogue: Create opportunities for regular, open conversations with investors, such as quarterly webinars or one-on-one meetings, to address their concerns and build rapport.
Why It Matters: Greater transparency builds trust, reduces uncertainty, and helps investors feel more confident in their decision to allocate to your fund. In an industry where trust is paramount, going above and beyond on transparency can set you apart as a manager who values openness and accountability.
4. Offer Solutions, Not Just Products: Align with Investor Needs
Fund selectors are increasingly looking for managers who think beyond individual products and focus on providing solutions to specific investor challenges. This means positioning your fund as a tool to achieve particular outcomes, such as inflation protection, capital preservation, or monthly income. Instead of simply listing features and benefits, frame your fund in terms of how it solves a problem or fulfills a specific investor need.
How to Do It:
Clearly Articulate Your Fund’s Objective: Define your fund’s purpose, underlying philosophy, and how it addresses a specific investor need.
Tailor Your Messaging: Present your fund as a solution for specific challenges. For example:
For income-seeking investors, demonstrate how your fund provides steady, reliable returns.
For growth-oriented investors, highlight how your fund targets long-term capital appreciation.
For ESG-focused investors, showcase how your fund aligns with their values while delivering competitive returns.
Provide Evidence: Use case studies, performance data, and testimonials to demonstrate how your fund has successfully addressed similar challenges in the past.
Why It Matters: A solutions-oriented approach demonstrates that you understand your investors’ goals and are committed to helping them achieve those goals. It shifts the conversation from selling a product to solving a problem, which resonates more deeply with fund selectors and investors alike. This approach not only differentiates your fund but also builds trust and long-term relationships with your audience.
5. Be Consistent Through Thick and Thin: Deliver on Your Promises
Consistency is key to building long-term trust with investors. Fund selectors value managers who stick to their knitting, delivering consistent results regardless of market conditions. This means building a track record of consistent alpha generation through a robust, repeatable, and well-articulated investment process.
What Selectors Look For:
A clear and well-defined investment process that is easy to understand and communicate.
A track record of sticking to your strategy, even during market volatility or downturns.
A focus on delivering the outcomes you’ve promised, aligning with the fund’s stated objectives.
How to Achieve This:
Document Your Investment Process: Clearly outline your strategy, decision-making framework, and risk management practices.
Track Performance Metrics: Regularly monitor and analyze performance to ensure alignment with your stated goals.
Communicate Clearly: Keep investors informed about your process, performance, and any adjustments to your strategy.
Actionable Takeaway: Ensure that your investment process is thoroughly documented and that every member of your team understands and follows it consistently.
Why It Matters: Consistency reassures investors that your fund will perform as expected over time, reducing the likelihood of surprises and building confidence in your ability to deliver. It also demonstrates discipline and professionalism, which are critical for long-term success in a competitive market.
6. Hire a Gatekeeper: Leverage Sell-Side Expertise to Refine Your Proposition
While fund selectors focus on buy-side due diligence, Gatekeepers (or sell-side consultants) act as the necessary intermediary link—often overlooked—that can help fund managers prepare for the scrutiny of fund selectors. These professionals conduct full sell-side due diligence, review the fund’s proposition, and produce a polished sell-side investment proposal. Here’s why hiring a Gatekeeper can be a game-changer:
Refine the Fund’s Message: Gatekeepers help articulate the fund’s value proposition in a way that resonates with investors. They ensure the narrative is clear, compelling, and aligned with what fund selectors are looking for.
Prepare Investor Materials: From pitch decks to fact sheets, Gatekeepers ensure that all investor-facing documents are professional, consistent, and tailored to the target audience.
Guide Through Tender Processes: Gatekeepers have deep expertise in navigating the RFP , RFI and other tender offer processes, helping managers respond effectively to investor queries and stand out in competitive evaluations.
Control the Narrative: While fund selectors often review documents with a restricted lens, focusing on specific criteria and protocols defined by the investor, Gatekeepers have a wider perspective. Their service is tuned to assist managers in taking control of the narrative, emphasizing their unique strengths and differentiators, and ensuring the right message is conveyed to investors.
Bridge the Gap: Gatekeepers act as a critical link between fund managers and fund selectors, ensuring that the fund’s strengths are communicated effectively before it undergoes buy-side due diligence.
Why It Matters: Fund selectors are inundated with proposals, and first impressions matter. By working with a Gatekeeper, fund managers can ensure their proposition is polished, professional, and investor-ready before it reaches the fund selector’s desk. This not only increases the chances of making it onto buy lists but also builds credibility and trust with investors.
Conclusion: Stand Out in a Competitive Market
In a world where investors are inundated with options, standing out requires more than just strong performance or a recognizable brand name. By knowing your market, taking well-judged risks, going above and beyond on transparency, offering solutions rather than just products, demonstrating consistency, and leveraging the expertise of Gatekeepers, you can supercharge your fund's proposition and capture the attention of fund selectors and investors alike.
The fund managers who succeed with their fund raising efforts in 2025 and beyond will be those who understand their audience, innovate thoughtfully, build trust through transparency and consistency, and collaborate with the right intermediaries to refine their message. By focusing on these six key themes, you can position your fund as a compelling choice in a crowded and competitive market.
Disclaimer Please note that articles may contain technical language. For this reason, they may not be suitable for readers without professional investment experience. Any views expressed here are those of the author as of the date of publication, are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may make different investment decisions for different clients. This article does not constitute investment advice. It is provided for information purposes only and does not constitute an invitation to invest. Please seek advice from your investment advisor before investing.
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