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Fundraising
LP Raise Red Flags

What are some glaring qualitative, interpersonal, or behavioural alarm bells or red flags when attempting to raise money from a limited partner?

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Community Member
1
0
Jul 20, 2023
Top Repies
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Mike Suprovici
Accepted Answer
Jul 20, 2023
Here are some potential causes of LP concerns during diligencing on GPs:

  • Size of fund too large for new manager
  • Large # of deals per person
  • Poor updates 
  • Small network
  • Bad references from portfolio founders 
  • Bad references from co-investors 
  • Unfamiliar sector
  • GP is unable to openly discuss previous investment mistakes
  • GPs track record doesn't match the thesis
1 answer
0
Mike Suprovici
Accepted Answer
Jul 20, 2023
Here are some potential causes of LP concerns during diligencing on GPs:

  • Size of fund too large for new manager
  • Large # of deals per person
  • Poor updates 
  • Small network
  • Bad references from portfolio founders 
  • Bad references from co-investors 
  • Unfamiliar sector
  • GP is unable to openly discuss previous investment mistakes
  • GPs track record doesn't match the thesis


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