What We Look For: Keys to a Successful Capital Raising Partnership
Raising capital is challenging even in the best of circumstances. It becomes exponentially harder when we’re not aligned with our GP partners.
After 20+ years raising capital, we’ve observed certain traits shared with our clients that consistently lead to productive, successful collaborations:
Strategy:
Strategy Edge: A source of strategy edge that can be explained simply, even to my 85-year-old mother.
LP-focused materials: High-quality, thoughtful marketing content that helps LPs understand the opportunity.
Market Suitability: Clearly articulating the macro or market environments in which the strategy will thrive—or underperform—and delivering accordingly.
Alignment: Significant personal and team investment alongside investors.
Conservative valuation strategy: Approach asset valuation conservatively and transparently.
Asset and capacity should match: Pay close attention to structuring the capacity to match the underlying asset liquidity.
Fair economics: A fee structure that balances alignment with investors and fair compensation.
Early Support: Former colleagues or experienced investors who believe in the strategy should be the first to invest in it.
Team:
Integrity/Trustworthiness: A history of doing the right thing and not cutting corners.
Team Cohesion: A team with a track record of working together effectively.
Strong operational Leadership: A senior, empowered COO who handles operations, allowing PMs to focus on performance.
Coachability: Willingness to accept and apply constructive feedback.
Respect for All: Treat everyone with dignity, from CIOs to junior analysts.
Team Investment: Pay your people well and foster an environment that reduces turnover.
Humility: Maintain grace and self-awareness in both good times and bad.
Collaborative Framework:
Accountability: Active engagement in the fundraising process and expectation-setting with advisors. Hold us accountable and be willing to be held accountable on deadlines and deliverables.
Availability: Adhere to investor availability and avoid canceling meetings at all costs.
Responsiveness: Timely, thoughtful answers to all investor questions and follow-ups.
Transparency: Consistent investor communications—even during periods of underperformance.
True partnership mentality: Understand that capital raising is a partnership, not a top-down relationship.
Eagerness to compensate: Understand that compensating the placement agent for results is the point of the exercise. We’re not successful unless you are widely successful.
We don’t expect every manager to meet all our criteria, but at Castle Hill, we’re focused on finding those who align closely with what matters most to us.