Should first-time fund managers focus fundraising on landing one flagship anchor LP, or on cultivating the small pool of GPs/institutions who back first-time managers?

Tomasz Tunguz · Apr 21, 2023

A first-time fund should go after large institutional anchors first rather than easier friendly checks

Filling two of five LPAC seats with institutional backers up front assuages newer LPs' concerns, and those anchors take reference calls and guide the rest of the process — like a series A lead doing diligence others follow

Scope: assumes you have some existing institutional relationships

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Nikhil Basu Trivedi · Sep 6, 2023

A first-time manager should get an early yes from one well-known institution that has known them a while, and then concentrate effort on the small group of 10-15 institutions capable of writing a large first-fund check

That group is a small n, so it is the right set to test whether anyone will do it; a recognizable institutional yes is impactful even if the check is small

Scope: describing what worked for their own raise; check size less important than the name

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Nikhil Basu Trivedi · Sep 6, 2023

Only about 10 to 15 LPs worldwide are genuinely independent thinkers willing to make the first or first large commitment to a first-time fund

Most LPs follow others rather than take a chance on unproven managers; the few who do had not known him and his partner for long

36:11 Only a handful of lps worldwide are independent enough to back a first time fund

Harry Stebbings · Sep 6, 2023

Emerging managers over-focus on landing an anchor LP; they should instead get the GPs they most respect in as LPs and leverage those checks and introductions

A GP who both makes the intro and invests carries far more signal to other LPs

37:33 Leverage respected gps as lps rather than chasing a single anchor lp

Adam Besvinick · May 29, 2023

First-fund LP bases come almost entirely from the manager's pre-existing personal network or referrals from within it

Every LP in Fund I was someone he knew personally from years in the early-stage ecosystem, or an introduction from one of those LPs — and this continued into Fund II

13:41 First fund lp base comes from the managers pre existing personal network