Good relationships should be a key goal for any manager because they help secure and retain clients. In a previous blog entry on how to prepare for investor meetings, we cited two pillars of relationship building: credibility and rapport. A lack of credibility will give potential investors a reason not to do business with you. Strong rapport will give them every reason to do business with you. Since investor decisions often hinge on the meeting, the in-person contact that leads them to trust – or not to trust – the hedge fund manager with their money, building credibility when making a presentation is crucial. In our last blog entry, we outlined specific steps to build credibility. Today, we’ll do that for rapport, excerpted from our most recent Strategic Commentary, “It All Comes Down to the Meeting.”
Understand, and be understood. Accurately appraising and connecting with your prospect/client/investor’s situation, needs, and goals is crucial to the sales process, and will directly affect their ability to understand you. Learn to actively listen, to ask for clarification, to stop talking and answer questions. A caveat to the advice above about preparing talking points is to be prepared to go “off book” to address questions and concerns from the other side of the table. Remember, it’s not about you, it’s about them. If you want their money, you have to give them their due.
It’s not about you. Did we already mention this? It bears repeating. In the post-Madoff world, you’re guilty until proven innocent. Confidence sells, arrogance breeds concern. The days of Masters of the Universe are over, and communicating with clients and prospects alike cannot be considered just a necessary evil, rather it needs to be embraced as a key foundation of doing business. As the latest Credit Suisse Global Manager Survey reported, “Managers and investors are increasingly coming to realize that they need to view each other as long-term partners."
Make it real. Keep in mind you’re talking to a human being. Be conversational. Talking points are guideposts to a conversation, not canned text to be recited mindlessly. Ironically, the best way to avoid stiffness is to practice and keep practicing. The more you internalize your facts and themes, the more comfortable you’ll be with them, and the more you can make it a natural conversation. Practice with colleagues before you ever set foot in a meeting.
Improper table manners. How you behave verbally and nonverbally makes a lasting impression. Are credibility, professionalism, competence conveyed when you’ve got your head and eyes lowered? When you use verbal graffiti like “um” and “uh”? When you fidget with pens, markers, or notes? These are the least egregious of the many bad habits we’ve seen in meetings.
Proper table manners. How can you convey desirable characteristics like professionalism and competence? Try sitting up straight – not ramrod straight, but relaxed and poised. Maintain eye contact. Speak clearly. Smile once in a while. Make friends.
Maximize your impact. There are further tactics you can employ to get the most out of your meetings. Be aware of your hands: gestures should emphasize your points; flailing about will be distracting to say the least. Project your voice: this expresses confidence and ensures you’ll be heard; try speaking to the back of the room to ensure you’re projecting. Don’t rush: add emphasis with judicious pauses. And most important, communicate with passion. Passion doesn’t simply inform, it persuades.
The capacity to learn, embrace, and execute these recommendations varies from firm to firm and individual to individual. For some it will come naturally, for others it may feel uncomfortable at best, impossible at worst. Regardless of which group you fall into, almost everyone can be helped by professional coaching. It is up to those responsible for the sales process to gauge the capabilities and make certain that everyone’s skills and techniques are optimized. Anything less puts your very business at risk.
Categorized under: Hedge Fund Due Diligence