Sixpoint's Zoller Fundraising Tips for GPs: Talk to Your LPs and Have a Plan Before You Market
Eric Zoller co-founded Sixpoint Partners in 2007 with Seth "Yossi" Siegel. The placement agent, which has offices in New York and San Francisco, helps GPs raise capital with a fund size from $300 million to $1.5 billion. They also advise on the sale of secondary positions. Zoller spoke to me by phone to give me some tips on fundraising. What's the number one thing that GPs do wrong when they fundraise? Poor communication with LPs is the number one failing. This happens from two perspectives. Too often GPs will announce the launch of their fundraise without soliciting input from their existing investors. GPs should maintain an ongoing dialogue with LPs before, during and after an annual meeting. However, they sometimes will spontaneously announce to investors the fact that they're coming to market. There isn’t enough ongoing communication about the firm’s development, strategy and fundraising status on a day-to-day basis between GPs and the LPs. These are people that you have to have ongoing communication with. Existing investors shouldn’t hear about the launch of your fund from a news article or chatter in the market. They should really hear about the launch of the fund from you. Also, the GP should really solicit existing investor input before going out. This is very important.
