I am 30 years old and have eight years of real estate development experience. My firm wants me to begin helping with the capital formation or equity raising. I would love to hear some feedback on what some of you do who are in this role in terms of what it takes to be successful. Mainly curious in what events do you often go to? How do you handle out reach and what level of “shmoozing” is done.
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Analyst 2 here, started working capital formation nearing end Y1 at my firm. Basically it’s me, EVP, and CIO raising our new fund series, $1B target. Young firm (10yrs or so), has always aggregated our HNW capital into our ‘funds’. This is the first time we’re going direct to institutional equity cap markets and raising a conventional market style value-add / opportunistic fund. From my POV, what I’m fortunate enough to be exposed to & learning right now is 10x more valuable than the gritty investment analyst model work. Now pitching the firm, its track record, and differentiators, along with the particular fund strategy. On calls all day every week with our CEO / founders and gambit of global institutions. PREA is our main event, seems to be one of the best. Road shows with the big dogs also a huge perk. Having a seat on the bus to observe leadership craft ideas / strategy is invaluable. The ‘schmoozing’ you refer to I’m learning more to be intelligent finesse. Outreach is dogged hustle and persistence. Were raising industrial + data centers. Overall cant recommend capital formation enough, never want to leave. I’m just a young guy, but hope this helps.
Great insight. A few random questions for you if you don't mind:
- What do you add to the calls that you're on? Are you just sitting back, listening, taking notes? Or are you tacking on to what your CIO says? Are you the one creating the pitch materials?
- How are you guys positioned to raise a $1b fund with only 10 years of experience, especially in this market and with this being the first round at getting in front of institutional investors? You guys must have some sort of huge differentiator that also scales?
- Are you still close to the real estate? Do you analyze the deals & financial models to understand the investment thesis and drivers? Do you connect with your acq/AM teams on what they're working on?
Don't mean to press you, just curious. Feel free to answer as much or as little as you want.
Looks like most of the events are member only. Sounds like it’s worth the membership? What’s the format? Round table, speed dating, cocktail hours?
What is your background? What role are you coming from? That would help people give more tailored responses.
I’m a senior development manager but I have an MBA and CFA, so pretty strong finance background
If you can help with capital formation while retaining your responsibilities on the more real estate related work that's great. I'm at a small fund myself and have a lot of capital formation / investor relation responsibilities since we aren't big enough to have a separate team. But be sure you aren't being silod into an exclusively capital raising type position unless you think that's a good fit.
At the end of the day all high level positions are "sales" to some extent but in IR you'll be pure sales with no technical track record to rely on if you ever wanted to start your own fund / do your own deals.
There is though a discernible difference between IR and capital formation - the two are not synonymous. Important to note.
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