How to Prepare for Investor Meetings: Hedge Fund Communications Part Two

By Eric Brand and Kevin Kasper, BK Communications Group | Tuesday, June 29th, 2010

This article is part two of a three-part series from guest contributors Eric Brand and Kevin Kasper, Principals at BK Communications Group.

Good relationships should be a key goal for any investment manager because they help secure and retain clients. In our previous blog entry on how to win and retain assets, we cited two pillars of relationship building: credibility and rapport. A lack of credibility will give potential hedge fund investors a reason not to do business with your firm. Strong rapport will give them every reason to do business with your firm.

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. Today, we’ll outline specific steps to do just that, excerpted from our most recent Strategic Commentary, “It All Comes Down to the Meeting.”

Know your audience. What are the roles of the people you’re meeting with? Their responsibilities, decision-making powers, investor meeting prep checklist place in the pecking order? Being familiar with this most basic of data points will not only help you pitch, it will communicate interest and respect. Know their level of sophistication so you can gear your language appropriately. How difficult is a quick Google search before the meeting to discover any relevant issues or unknown (to you, anyway) connections?

Know your goal. What message do you want to get across? Remember, there are tactical messages that are explicit (our operational efficiency has increased, your hedge fund portfolio is now poised to recover losses, etc.) and there are meta messages that are implicit (we are hedge fund professionals who take our business seriously, we are not in panic mode, etc.). Close with a call to action: what is the next step you want them to take?

Be ready to tell your story. Define and rehearse your core message, a concise description of your hedge fund’s value proposition and chief differentiators. Organize your thoughts beforehand to ensure the conversation flows naturally and logically from one topic to the next. The more organized you are, the better the conversation flows, the more they’ll assume you’re an effective manager, owing to what psychologists call “transference.”

Be prepared to respond. Anticipate the questions you’re likely to be asked. What are their specific concerns or interests? A high-net-worth individual will want information or confirmation on very different subjects from a pension fund or a consultant. Put yourself in their shoes – focus on what’s in it for them.

Keep time in mind. Arriving to the meeting on time might not impress anybody – but arriving late will definitely leave a negative impression and erode your credibility right from the start. Confirm the timeframe beforehand, and pace the conversation accordingly. Prioritize your talking points to ensure you hit them in the time allotted. Consideration for someone’s time goes a long way in evincing professionalism and engendering positive feelings.

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.