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How to Lose a Sale in Ten Days

The best marketers are helpful, responsive, honest. The worst end up on our “do not call lists.” Here’s what not to do when pitching your fund to an institutional investor.

I estimate I’ve taken about 2,000 meetings with investment management firms over the past decade or so, 200 per year on average.

While that’s a pretty robust schedule of meetings, I realize it’s not because of my scintillating wit or sparkling personality. It’s just that having the ability to allocate hundreds of millions of dollars each year can make one very popular with asset managers.

As a result, I’ve met thousands of investment sales professionals, all of whom try their best to get in our good graces, some less successfully than others.

In the interest of fair disclosure, I thought I’d put pen to paper to help level the playing field and reveal some do’s and don’ts for sales practices.

Do realize that we receive a large amount of unsolicited requests, sometimes 100 emails a day, all asking for 15 minutes of our time. Individually, the inbound requests may seem reasonable, but do the math. I sometimes can’t read them all, let alone give them each 15 minutes in a day. (I still haven’t figured out where that 25th hour would come from.)

So please don’t always expect a response, let alone an immediate one. But do know this: If it’s a likely fit, we will get back to you.

If we have scheduled a meeting as a result of your inbound request, please don’t begin with asking us, “What do you want to know?,” or telling us, “This is your time,” or some variant thereof. This open-ended approach makes sense if I’ve asked for your time on-site but not when you’ve asked for mine. Come with something to say.

But please, please, please don’t pitch me “solutions.”

I had a marketing professor in business school who used to say the best salespeople answer the question “What do you sell?” by first asking, “What do you want to buy?” “Solutions” is the asset management equivalent of trying to figure out how to jam what you sell into what I want to buy. Just. Don’t.

Your firm is not the best at everything, and it’s not your job to solve my problems. I understand wanting to ensure the conversation is relevant and actionable, but start with talking about what you do best. It’s my job to decide if that skill set can solve a need.

Do understand that it’s a long sales cycle for public institutions. Much of that has to do with the very deliberate nature of our investment processes, compounded by the fact that those already deliberate processes sit within highly bureaucratic governance structures.

The average lag between meeting a manager for the first time to closing on an investment with that firm is well over one year. Many times it’s a multiple-year time horizon, and anything under six months is just about impossible. All of this is a very long-winded way of saying it takes a lot of time and effort. Don’t expect quick decisions.

Now, I know you have a job to do too. And because of our slow processes and relative resource constraints, our responsiveness isn’t always what you’d like. Admittedly, we may also not be the most transparent either.

You see, being large and slow can create challenges, but it also means we get to see a lot of competitors. This means our default stance is to keep our investment options open as long as possible when undecided. So, here are some tips on how to decipher our level of interest after the meeting.

As a rule of thumb, when we say your pitch is “interesting,” it means, “It’s not going to be an actionable priority anytime soon.” When we say, “We will reach out for more information if it makes sense,” it means, “Please don’t bug me about this again.” If the answer is “It’s not a fit at this time,” it’s not going to be one anytime soon. If it is our best idea, we’ll tell you.

Look, I realize salespeople are taught to never take no for an answer and to follow up with multiple touch points. I’ve seen the data — 80 percent of enterprise sales occur after eight interactions — but I promise you following up that email with an immediate phone call rarely helps your cause. And it certainly doesn’t help to do it three days in a row.

If it’s been a day and you haven’t heard back from me, your best bet is to simply wait. Keep in mind, we rarely have assistants. (Heck, often we don’t even have an analyst!)

Do be pleasantly persistent. We get it.

But don’t be a pest. That’s a surefire way to get on the “do not answer” list.

The best business development people I’ve worked with are those who, when they do reach out, offer some value outside of simply pushing product, whether it be market color, insight into the competitive landscape, introductions to other like-minded investors, or yes, sometimes career opportunities. I’m much more likely to answer that call.

At the end of the day, you can’t really “sell” us. Be helpful, responsive, and honest, and appreciate our time and process constraints, and we’ll do our best to do the same.

And you do officially have my permission to stop with all the holiday e-cards. 

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