If you are starting a new hedge fund, venture capital fund, or private equity fund, how will you know whether you could raise countless capital beyond family and friends, or disappear into the launch void?

Meredith Jones of MJ Alternative Investment Research has created this fantastic infographic for fund managers who want insight about positive – and negative – capital raise traits. A summary:


You may attract early investors if you have:

  • An audited track record

  • A track record in up, down, and sideways markets

  • A seed investor

  • Investments from former fund colleagues

  • A team of experienced management pros in place

  • A thorough business plan

  • Service providers with household names

  • Realistic expectations by your investors and you

Related: 9 Ways Emerging and Undiscovered Funds Can Get Discovered

Not Hotness

You may find the road to capital more like driving in the left lane behind the guy going 45 MPH of Interstate 10 if you have:

  • To rely on back testing to promote past performance

  • A solo manager model with few if any references from colleagues

  • A pitch book too focused on performance and investment strategy

  • Unknown service providers

  • Investment experience in only one type of market cycle

  • Unrealistic expectations on the amount and timing of the capital raise, and on management’s ability to achieve investment expectations.

Best to stay hot, my friends.

Related: 5 Ways to Promote Your Hedge Fund