Beyond Asset-Raising: Building a modern growth engine
The Asset-Raising Myth: Why Hedge Funds Need to Generate Demand.
We’re living in a library but only reading one book.
The way we traditionally raise assets is like only using your Bloomberg for the news feed
In the last article, we had a frank discussion about the industry's aversion to calling sales, well, sales and how that had hindered the implementation of generally accepted growth practices. Now we know why we do it, let’s take a look at how most funds currently generate demand.
Key Takeaways:
Current demand generation methods waste valuable sales team resources.
A properly integrated growth engine transforms sales productivity
Marketing, outbound, and events functions need clear separation and goals
Technology should free up humans for high-value interactions
Systematic processes beat random acts of marketing
The Current Method: A Very Expensive Way to Keep Busy
Here's how most funds approach generating demand: Put the fund details on half a dozen databases (that investors buy). Ring up cap-intro and buy another database - this time of investor contacts. After some sifting, researching and organising of contacts, it’s time to perform random acts of marketing: fire off some emails, call people who know other people, and get angry with the CRM. Then fiddle about with the formatting of a presentation for 30 minutes and be annoyed at the time wasted.
Your sales people will contact the investors that process worked on last time, calling this their "relationship-based approach." Then everyone gets terribly excited about planning trips, conferences, and roundtables because these are visible actions that show you're doing something. There's rather a lot of "doing." Sometimes it's more performative than productive, but that's what the internal structures demand.
If any other serious B2B business conducted their demand generation this way, you'd think twice about investing in them. But here's the opportunity - being first to modernise gives you a proper advantage.
The Sales Dilemma: Wearing all the Hats!
The investor has a multitude of interactions with your firm and fund that fall outside the narrow band between contact and investment.
We currently ask our sales function to be masters of everything without giving them the training, tools or support to execute. Except for someone we call Investor Relations, but who is normally a junior sales person, also without the training or tools.
They are expected to
Create compelling and engaging messages for investors at every stage of their interaction.
Oversee collateral that resonates and is technically complex.
Be their own outbound marketers and awareness generators.
Attend and create events for investors at all stages of their interaction.
Know everything about the investor market and competitor landscape.
Thoroughly understand and embody your brand, fund, and strategy.
Whilst also having to perform the array of tasked attributed to a broad sales role
prospect,
qualify leads,
pitch,
ensure compliance,
steward potential investors down the sales funnel,
respond to ODD and IDD, and
finally close the sale.
All this whilst appearing collected and being charming, at all times! It’s a testament to their dedication that they ever raise anything.
It's like asking your star fund manager to also be the compliance officer, risk manager, and IT support. Brilliant people, yes, but perhaps not the most efficient use of their talents or your resources. It would take them far longer than a professional, they won’t be as good as a professional, and they cost more. It’s the same for sales people and demand generation. They are separate but aligned skillsets.
Let’s not skip over this last but fundamental point: Sales people are incentivised to bring sales to them. They are not incentivised to build an enduring demand generation engine that brings leads to the firm. Every day they have to make a multitude of choices that boils down to two options:
1) Do something that might bring a sales lead to me, now.
2) Do something that will create demand for the fund in a years time.
You know which one they’re going to do. And that’s the right thing for a sales person to do! Neither their timeline or incentives align with demand generation. So stop expecting them to do it. Instead, create an environment where they can focus on what they do best - sales.
How a Growth Engine Should Actually Work
Picture this: A properly integrated growth engine where each function knows its role and executes it beautifully. No more random acts of marketing, no more wasted effort, no more trying to be all things to all investors.
In the awareness and consideration phase of investor interaction, the demand generation portion of growth looks like this:
Marketing Function
Your marketing function becomes the engine that drives inbound requests. It:
Delivers timely, relevant content through targeted channels
Builds awareness and authority systematically
Creates content that gets repurposed across multiple touchpoints
Amplifies every piece of content for maximum impact
Actually measures what works (revolutionary, we know)
Outbound Function
A dedicated outbound function that reduces noise for your sales people. It:
Runs nurture campaigns that help investors self-select based on their current interest in your investment strategy
Creates personalised, relevant touchpoints that resonate with investors based on their interest and level of knowledge
Passes qualified leads to sales that are engaged and interested to learn more
Tracks engagement patterns to increase efficiency and optimise human interaction
Builds intelligence about investor preferences
Events Function
An events strategy that:
Works with marketing and sales to maximise impact
Ensures events drive actual demand, not just nice lunches
Coordinates follow-up that doesn't feel like stalking
Measures ROI on event spend
Creates content opportunities from every interaction
The result is an enduring demand generation engine and the beginning of the infrastructure that drives asset growth. When these functions work together you get:
More warm interactions (fewer awkward cold calls)
Increased inbound requests (yes, investors calling you)
Better targeted outreach
Sales team focused on high-value work
Measurable ROI on marketing spend
Fewer "random acts of marketing"
Systematic feedback loops that improve the entire process
Increased industry authority and presence
“What’s the catch? That sounds expensive…”
Well, yes, there is a catch. You have to stop treating your fund management firm like a small business. It’s not enough to have a couple of sales people running about supported by a junior. I know you hired a PR firm once, but you fired them because they didn’t get you in the FT within the month. That’s not going to cut it. You have to see your firm as it is: A high-revenue generating B2B business with a 20 year future. Then you have to invest accordingly. But here’s the good news, you probably don’t need as many full time resources as you think.
In our next post, we'll break down exactly how to implement this transformation, including why a Fractional CGO might be exactly what you need to build this engine without breaking the bank or disrupting your current operations. (Spoiler: It's about working smarter, not just throwing headcount at the problem.)
Ready to stop random acts of marketing?
Let's discuss how a Fractional CGO could help you build a systematic, scalable growth engine that transforms your approach to investor demand.
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*Note on systematising: When we say systematic, we don't mean robotic. We mean creating processes that enhance human interaction, not replace it. Think of it as giving your brilliant people the tools to be even more effective at what they do best.