Investor Retention 101: How to Keep Them Coming Back for More

You’ve done your homework, found the right investors, reached out to them and secured their commitment. That’s a critical near-term win. But your work has—in many ways—just begun.

To ensure your firm’s long-term success, you’ve got to keep investors coming back for more. If they don’t have a positive experience with you, this may be their one and only interaction with you.

5 Steps for Increasing Investor Retention

Take the five actions below, and you’ll find that your investor retention increases significantly.

  1. Take small actions frequently to reinforce trust. Consistency is key. By touching base with investors regularly (but briefly), being transparent, and exceeding their expectations in every way you can, you let them know you’re attentive and responsive. You also make them happy with their decision to work with you.
  2. Anticipate investor needs. What vital information can you provide to them before they ask for it? Or, at a minimum, what data can you have queued up and ready to send within minutes of a request? For example, they may need proof of track record and thesis execution documents, market reports, industry perspectives, etc.
  3. Don’t take the cyclical nature of relationships for granted. Investors like working with people and firms they’ve worked with successfully in the past. However, you shouldn’t assume that your investors will return to you. After all, many other firms will try to entice them to invest with them. A better approach is to assume an investor won’t come back and that you have to earn their interest continually.
  4. Reduce operational friction when closing a fund. The faster you can answer questions and the better you can adhere to compliance standards, the happier investors will be. If interacting with you is challenging, an investor will look for other less-stressful opportunities.
  5. Use technology built for supporting firms and investors. You can “get by” using systems and processes that you’ve modified for your purposes. But to thrive, you’ve got to implement solutions designed to make it easier for you and your investors to share information securely and seamlessly.

Be Proactive in Managing Investor Relationships

When it comes to investor retention, perhaps the worst experience is when you know you should make changes to your operations, but as you drag your feet, you lose a crucial investor—or multiple investors!

It’s easier than ever to implement purpose-built solutions. But it still takes time to find the right one, make the purchase, and get up and running with the system. Even if you aren’t in a position to adopt a new system today, you can do much of the legwork now so that you’re ready to take action when the time is right.

Don’t wait until the loss of investors forces your hand. Do your research, schedule some demos, and find the best solution to meet your needs and your investors’ expectations. With the results of your evaluations in hand, you can implement a system and get your team up and running with it as time permits. 

Contact Altvia today to request a demo.

A traditional crm was built for general ‘customer’ scenarios

Software platforms have made the world a better place by making work a better place. Indeed the world is better off when people enjoy their jobs even marginally more, and workplace applications on big CRM platforms like have done that and much more.

But the potential that platforms like these offer presents diminishing returns: once the platform provider has engineered too many industry specific components into its platform, its usefulness for other industries begins to be threatened, and with that so do the usefulness of the component tools built into the platform.

So it is with the CRM category that has defined: it is generic enough to work for many industries, and yet still offers the potential for others to round off the edges and nail more vertically-oriented and extremely tailored software solutions.

Private capital markets are actually a great demonstration of this dynamic. Where generic CRM platforms simplify — appropriately so — to assume there’s a business, a customer, a sale, and service of that customer, there are a few industry-specific pieces that are missing.

Take for example, that investors become customers by investing through legal entities the GP raises. It’s a subtle but important nuance that just doesn’t make sense at a platform-as-a-service level (because it’s overly complicated for a simple one-time sale that many industries require), but which can easily be added without 10 years or software engineering. Once provided, the rest of the platform’s components become tremendously powerful again and you’re set to take over the world.

As a traditional CRM in our pillars methodology, these nuances must be present to properly account for investors in these legal entities, potential target companies and which are owned by these entities, the context of all interactions with these parties (as well as the appropriate overlap, ie co-investments), and how you’re arriving at finding these opportunities on both sides of the equation, such that you’re able to piece together what’s effective and what’s not. Not just because we say so, but because these are the very relationships and data that are key to the motivation behind a CRM in any industry.

It’s critical, too, that the valuable publicly-available information that helps to enrich CRM systems and save users painful steps of entering it themselves is fully-integrated at the platform level.

Again, look no further than the 3,000+ pre-built integrations that — the creator of the CRM platform concept — has at a platform level to do so, and which only exists by way of holding just short of overly-specifying certain industry workflows that would present challenges to properly integrate.

Stakeholder reporting and communication (investor relations) draws on a range of datasets

The traditional “customer service” model of CRM systems once again makes overly-simplified assumptions about the customer relationship when applied to private capital markets.

In fifteen years I personally have yet to hear the terms “warranty” or “service call” in this market because it’s just not the same. But make no mistake, as uncomfortable as it may be to say aloud, customer service is more important now than ever and it’s constantly happening; the industry is, after all, considered to be a financial “service”.

As it turns out, that service is primarily information-based — it’s driven by data and takes the form of reports and analysis that drive decisions, and then end up again in investor-facing reports and analysis.

The foundational elements of a private capital markets CRM must be built such that they accommodate this data (like we discussed above), but so too that it can accommodate additional supporting data that investors (customers!) need in the context of service.

Oftentimes this supporting data — financial metrics and time-based values, for example — is believed not to meet the traditional definition of CRM and the natural thought is “well, better do this in Excel!”.

While I happen to believe Excel is still the greatest software application ever built, its introduction to this value chain we’ve discussed herein actually creates the problem many firms suffer from: key data needed to provide customer service (again: effectively the entirety of a firm’s reports and analysis) is now in disparate systems and detached.

Both of those dynamics are important and distinct: not only is this supplemental data disparate, but when brought together there is no logical association that can be made between the two data sets.

Allow me, then, to make the point very simply: not only can this financial and time-based value data (you may be thinking about is as “portfolio monitoring” or “accounting”) be a part of a CRM, it is arguably the most important part of a CRM because it’s at the core of what providing service to the customer entails — information that comes out of data!

Firms need a digital method to engage stakeholders (ie investor portals)

Investor portals are not new; in fact, for many of us — including myself — they conjure up horrifying nightmares in which we’re aimlessly guessing at folders to find the newest document we need.

So in lies the opportunity: not only have the portals we’ve come to hate not simplified the process of acquiring information, they’ve failed to create an entirely new experience that is “customer service” driven.

To be fair, this is not a B2C market where you’d be long out of business for not having focused on customer service and thus the customer’s technology-driven experience. But don’t expect to be around too much longer if you aren’t thinking about this shift.

Today’s institutional investors increasingly expect this same consumer-like experience, and a massive opportunity is being missed by not providing it. It’s not about providing them the experience they desire; it’s more about the ability to measure engagement that is had in return.

Put simply: what’s keeping the market from providing this experience is the availability of the information that’s required to create the service that provides the experience.

If you’ve hung in this long, you know that by focusing on your CRM, you have the data that’s required to manage the customer relationship and the technology-driven experience through which that information is shared to create a differentiated and opportunistic customer experience.

LP engagement