With great information comes great power

The thing about emails, faxes and letters is you never really know if they are opened or read with much interest on the receiving end. A GP that sends marketing materials to hundreds of prospective LPs doesn’t know which have been read with enthusiasm and which receive only a cursory glance out of passing interest. And follow-up phone calls, face to face meetings and waiting for replies can be a drain on time and resources.  

For that reason, GPs should be aware of software technology, such as IntraLinks and eFront, that tracks which LPs read marketing materials made available in a shared web platform. GPs simply provide login details to a shared data room that features documents firms are willing to share with potential LPs. 

For one, these software tools can be used to learn which LPs are genuinely interested in backing a fund based on the sheer amount of marketing materials downloaded from the shared system. This is helpful considering some LPs may have difficulty rejecting a pitch when the individual making the sale is standing a few feet away or has their ear on the phone. It can be a real time-waster when mild-mannered investors hoping to avoid an awkward rejection conversation string GPs along until a definitive no is finally conceded. But by checking the amount of due diligence or marketing documents clicked by the LP, firms can better target their limited fundraising resources to those LPs legitimately considering a capital commitment.  

In similar vein, GPs are also able to track whether quarterly reports, capital call notices or distribution notices have been downloaded by LPs already committed to the fund. This allows GPs to follow-up with those LPs who may have missed the exciting news contained in the fund's latest quarterly report uploaded to the data room, or perhaps provide a careful reminder that performance figures have suffered. One can also imagine a craftier dimension to this scenario: a GP who walks into a meeting with an LP, who is shown to have not opened the latest quarterly report, can use this kind of information to their advantage. Of course LPs who don’t do their homework lose out on the ability to ask the tough questions, but even more so when the GP knows it too. 

But for the most part, today's reporting technology allows GPs to hone their investor relations strategy. And given today's crowded fundraising trail, any technology that helps capture commitments is worth considering.