Once just a simple lunch and presentation, annual meetings have morphed into a critical event for General Partners (GPs). Typically taking place during November and April, these get-togethers used to focus solely on sharing current market insights, fund performance, and relevant investment decisions with Limited Partners (LPs). These days, while those topics are still on the agenda, there are several factors upping the ante when it comes to the planning and preparation.
For starters, for some GPs, this meeting is the only time during the entire year when they see their investors face to face. Not to mention have access to a quorum of their investors for a specific amount of time. They’re also under pressure to strengthen their relationships with LPs, who attend an average between 15 to 20 annual meetings a year. So in addition to communicating what needs communicating, the goal is now to make a memorable impression.
To stand out from the crowd of managers vying for LPs’ attention, GPs are putting much more effort into their annual meetings. Across Private Equity, the name of the game is engaging investors with more personalized communication on meaningful trends, insights, and of course, results. Below, we’ll dive into how GPs are using annual meetings as an opportunity to differentiate their brand and contribute to long-term ROI.
INCREASING INVESTOR ENGAGEMENT
Rather than a meeting “everyone has to attend,” today’s annual meetings are being used as a strategic tool to offer an experience with real value. Of course, GPs are still covering returns, but the focus these days is on engaging investors effectively to bolster fruitful long-term relationships.
During a typical annual meeting, a GP will highlight portfolio companies, discuss investments that didn’t go well, and share long-term strategic goals. Firms offering a little something extra will host informal dinners with plenty of time for networking—and even some entertainment—to encourage those casual conversations that deepen relationships.
Of course, the LPs are still there for the numbers. To offer real value, you have to do more than update last year’s figures and explain what happened in the previous year. The Kap Group recommends developing meaningful content to share with LPs. Show—don’t just tell—what your team has been doing and what’s really behind the fund’s performance.
SIMPLIFYING MEETING PLANNING
When we asked General Partners and Limited Partners in Private Equity about annual meeting prep, we learned that 41% of survey respondents feel the pain of creating annual meeting presentations. What’s more, LPs will be sure to share the presentation with their colleagues, so the final document must be able to stand on its own—and put your firm’s best foot forward.
With so much at stake, demonstrating that you’ve already made sense of the data you’re reporting on is a surefire way to stand out. While everyone has received the quarterly reports, it’s a safe bet that hardly anyone has read them and had time to derive any meaningful insights.
Thankfully, today’s fund management software is designed to track and report on exactly the data you’ll need to prepare for your annual meeting. For example, knowing who from your firm has talked to annual meeting attendees—and what they talked about—can be invaluable for starting conversations with investors that lead to future investments.
But who has the time to cull Excel spreadsheets and calendars of activity to track meetings and calls in time for the annual meeting? Adopting a good fund management software tool like AIM not only reduces the chance of errors, it makes gathering this kind of information as easy as clicking a button. You can also save your team time by using the tool to build an up-to-date guest list out of a shared database, sending out save-the-dates and invites, and keeping invitees up to date on all of the upcoming activities.
We hope this post has given you some food for thought for your next annual meeting. For more information about industry trends and best practices like the ones we’ve described here, subscribe to our blog.