Actionable fundraising advice

It's counterintuitive. It's also critically important.

We’ve been raising our first fund for a year now. The hardest part wasn’t the rejections. It wasn’t the term negotiations or the legal bills or the hundreds of cold emails.

The hardest part was learning how many people in this industry have absolutely nothing to offer you but will happily take your time anyway.

The nine most terrifying words in fundraising:

“I work with lots of the big family offices.”

I kept meeting the same guy over and over. Different name, different LinkedIn title, same pitch. Then I realized why he felt so familiar.

He’s the guy from college who told freshmen he could get you into parties because he knew a bunch of people there.

He’s “basically like an honorary brother” at Kappa Sig.

Sure, maybe he knew some of the brothers. Or maybe they couldn’t stand him. But honestly they most likely they had no idea who he was.

Honorary brothers grow up. They get LinkedIn accounts. They become Managing Partners at organizations with a very specific naming convention:

They’re everywhere and they will waste your time.

The family office world is opaque by design. Nobody publishes a list. There’s no directory. And where there’s opacity, there’s opportunity for people to position themselves as gatekeepers to rooms they’ve never been in and rooms that don’t actually exist

What is a family office?

The term used to mean something. The Mellons had a family office. It was called Mellon Bank. The Rockefellers had one. The Phippses. Families with generational wealth built institutions to manage it: in-house investment teams, tax specialists, estate planners, operating companies. A family office was a private institution.

Now the term means nothing.

Your neighborhood RIA with $50M under management has a trust and estate attorney he refers clients to. He calls himself a multi-family office. A wealth manager with three clients and a WhatsApp group calls himself a family office consultant. The phrase now covers everything from the Pritzkers to a guy who knows a guy who exited his HVAC to private equity (talked to three search fund interns)

This creates a problem for anyone raising capital. “Family office” sounds like money. It sounds like allocation authority. But the definition has expanded to include anyone adjacent to wealth.

The middlemen

Where there’s ambiguity, there’s opportunity. A whole industry has emerged in the space between “I know wealthy people” and “I control capital.”

They show up at conferences. They’re on LinkedIn. They want to “partner” with you on your raise. They “work with lots of the big family offices.”

What does that mean? What do they actually do for these families? Are they the accountant? The attorney? Do they have discretionary allocation authority? Are they an RIA with actual AUM? Or are they just around?

Most of the time, they’re just around. They know some people. They’ve been to some dinners. They have a Rolodex and a vague value proposition. Proximity without authority.

How to tell the difference

The problem isn’t people who are slow to say yes. Diligence takes time. The problem is people who cannot say yes because they have nothing to say yes with. No capital. No authority. No mandate.

When someone offers to make introductions or help with your raise, ask direct questions. What do you do for these families? Do you have discretionary allocation authority? Have you personally allocated to a fund before? What was the check size? Can I meet the person who signs the check?

Real gatekeepers answer fast. They’re not offended. They have answers.

Honorary brothers get vague. They need to “socialize it.” They want to “stay in touch.” They’d love to find ways to “collaborate.”

Friday night rolls around and they’re nowhere to be found.

But come Monday, you just missed them and Friday night was a movie.

They sell a dream.

What we do about it

We qualify before we meet. Before any first meeting, we ask three questions: What’s your typical check size for emerging manager funds? Are you actively allocating this year? What specifically about our fund caught your attention?

If the check size answer is vague, we don’t take the meeting. If they’re “always looking” but not actively allocating, we don’t take the meeting. If they can’t articulate what caught their attention, they haven’t done the work and we don’t take the meeting.

We set time limits. Twenty-one days to get a first meeting or we move on. Thirty days in discovery. Forty-five days in diligence. If someone’s been “reviewing materials” for two months with no questions, they’re not reviewing materials.

We track engagement. When we send our data room, we can see time spent. Less than five minutes means they skimmed. Twenty minutes with no follow-up means there’s an objection they’re not voicing. We’d rather hear the no than let it die in silence.

We use the three-touch rule. First touch is the intro. Second touch is a value-add. Third touch is direct: should I assume timing isn’t right? No response after three means they go on the quarterly update list. We don’t chase.

The goal is to get to no as fast as possible. Every hour spent with someone who cannot write a check is an hour not spent with someone who can.

Founders, investors, top girl scout cookie sellers: what’s the best fundraising advice you’ve ever received?

Let me know on LinkedIn or leave a message here.