Know your investors and keep fiduciary responsibility at the forefront

Finding out your investors’ portfolios goals and pain points is critical to becoming part of the solution. Trying to pitch the highest performing fund in your toolkit to an investor who does not need it is a waste of time for both parties. For example, many institutional investors have switched to index in their core U.S. equity offering. Pitching a first quartile U.S. value equity strategy to an allocator who is quasi passive in the asset class is not relevant. For many asset managers, chronic inertia has left them drowning in dormant back books of investment products that are no longer suitable for today’s complex portfolios. To stay in the game, they are obligated to meet the full and changing fiduciary duties of investors by providing solutions that are relevant.

Others get blinded by the objective of selling everything. Throwing the kitchen sink at investors will not only highlight a lack of preparation but will also signal a disregard for their fiduciary responsibilities, creating long term brand damage.

Keep it Simple, Authentic and Relevant

Simple: Investors want concise and clear communication. They don’t have time to listen to long-winded monologues and jargon filled explanations. They want to hear the facts, the benefits, and the evidence.

Authentic: Sophisticated investors easily sniff out faux humility. Nothing beats being authentic and genuine for building rapport and trust.

Relevant: Dumping data and complex charts won’t help. You need to turn performance/risk and other relevant data into information that is compelling to the audience.

Craft the Story

Your pitch needs to tell a story that connects with the investors’ motivation. A story with the right structure can help you illustrate the problem you are solving, the solution you are offering, and the impact you are creating. Sometimes the story is easily crafted within the allocator existing framework. For example, it would be much more powerful to present a Trend strategy within the broader risk mitigation context than as a stand-alone product.

Listen and Engage

Being prepared before a presentation is a must. Being scripted and deaf to the audience is a recipe for disaster. Communication is not a one-way street. Your presentations and pitches should never be prepared as monologues but interactive exchanges. Be prepared for the unexpected.