what is a normal process that LPs do due diligence before they commit?
Various LP Archetypes have significantly different diligence requirements. Here are some high-level requirements:
High Net Worth Individuals (HNWIs): Many HNWIs sign PACTs shortly after the initial pitch meeting and don't require a lot of materials if any. Some may require a pitch deck or an executive summary.
Family Offices: Family Offices typically require full data room access and references.
Institutional LPs (Fund Of Funds, Sovereign Wealth Funds, Endowments etc..): Institutional LPs require all the information of Family Offices. In addition, they will do significantly more reference checks, diligences your back office vendors, operations systems, speak with your portfolio founders and do a lot of off list reference checks.
Corporates: Corporate LPs require an enterprise sales process. Since they are investing to achieve some sort of strategic goal, they will focus their diligence on how your fund can help their company. Like most enterprise sales cycles, they can take 12 - 18 months to close or longer.
For more information about the requirements of LP Archetypes, watch this video.
High Net Worth Individuals (HNWIs): Many HNWIs sign PACTs shortly after the initial pitch meeting and don't require a lot of materials if any. Some may require a pitch deck or an executive summary.
Family Offices: Family Offices typically require full data room access and references.
Institutional LPs (Fund Of Funds, Sovereign Wealth Funds, Endowments etc..): Institutional LPs require all the information of Family Offices. In addition, they will do significantly more reference checks, diligences your back office vendors, operations systems, speak with your portfolio founders and do a lot of off list reference checks.
Corporates: Corporate LPs require an enterprise sales process. Since they are investing to achieve some sort of strategic goal, they will focus their diligence on how your fund can help their company. Like most enterprise sales cycles, they can take 12 - 18 months to close or longer.
For more information about the requirements of LP Archetypes, watch this video.