Fundraising – a game changed
Whether investors are intensely focused on emerging markets, just more reticent to commit capital generally, or simply waiting for more economic certainty, there is no question that fundraising for Australian funds will continue to be difficult. In speaking about CHAMP’s recent successful fundraising, Jones explained that average commitments took three to four meetings to “get there. And even people who passed took two meetings to decide, which adds up to hundreds of meetings in total.”
In short, gone are the days of unearthing the rolodex once every four to five years and calling up investors for a new fund.
Philip Levinson, MD for Blackstone, said that today, investors want a very individualized approach from GPs. "It's about knowing what people want and modifying your approach accordingly." This includes everything from the flow of information within a PPM to cultural differences among LPs in different markets and in different types of institutions.
Telstra Super's Televski said that they want to see a move from GPs on the issues that groups are concerned about: "We want a reduction in fees, and increased commitments by GPs in their own funds." This, he claimed, would go a long way in convincing trustees that at least groups were listening, and attempting to meet supers half way.
With the fundraising market a bit of a gamble, many in the industry believe that the current climate will act as a catalyst for the rationalization of fund managers in Australia. Nothing can guarantee getting across the line with a fund manager, and sometimes, "you have to accept that you're not attractive." Those who do get through the next fundraising cycle most believe have a starry-eyed future ahead of them.
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