I had gotten a lot of questions about fundraising. LPs are very straightforward actually. There are some unwritten rules to this game you have to understand and follow.
They care about decent returns and a repeatable and consistent strategy. LPs are happier with a consistent 20% return, as opposed to an inconsistent 40% fund. LPs want a fund manager that is a "wild stallion" that has high performance, but inconsistency in strategy, returns, etc.
LPs want to see that you have a stable team, a consistent strategy, a structure and disciplined method to how you do things. It also helps if you have a secret sauce to how you get great results - are you great at understanding deep tech, do you have access to deals others don't, are you able to uniquely add value.
Some examples I've seen of a secret sauce is 1) a Chinese firm that can actually execute state-owned-enterprise take-privates, and thus can grab value that others can't, 2) a VC fund that came out of systems integrator, and leverages their access to CTOs in Fortune 100s to get their portolio companies their first big corporate contract, 3) funds that bring technology cross-border, thus introducing totally new tech to a promising market.
I'll add more thoughts in the thread, in response to questions.
Great thread! Work at an LP in Asia, and would add that the SWFs/Large Pensions of the world also like to see more co-investment, especially given increasing levels of sophistication and dedicated direct investment teams; it seems that a number of first-time funds have been offering co-investments to potential LPs to kickstart fundraising momentum.
Also know which Chinese SOE-take-private firm you're talking about and agree wholeheartedly on their secret sauce, although it probably has evolved a bit over the years.
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