“Every month for an LP is like a day.”
I just finished our latest Emerging Manager Spotlight on institutional LP due diligence, and I keep coming back to something Caleb Ollech (Director of Investments at Johns Hopkins) said that captures what this process is really about.
When evaluating emerging managers, Caleb’s team asks themselves:
Would I want to work with this person for the next 10 to 12 years? We kind of internally view it like… that’s the average American marriage.
Our panel brought together emerging managers who’ve navigated this process recently—a16z alum Michelle Volz from PAX Ventures (defense/space/energy), Megan Lightcap from Slow Ventures—alongside Caleb Ollech, who sees hundreds of emerging manager pitches from both fund-of-funds and endowment perspectives. Plus, Noah Tagliaferri from Pliancy shared what trips up managers during deeper diligence.
Here’s what we learned about the institutional game (watch the video below, or just keep reading for a summary 👇)
This edition of the Emerging Manager Spotlight was presented by Pliancy.
Pliancy is a tech-enabled professional services company offering IT solutions to bold, emerging companies. Pliancy was built on the belief that deep, meaningful connections were the missing link in IT.
Thanks to single point-of-contact relationships, Pliancy consultants act as true business partners for each client, solving high-impact problems quickly, creatively, and with the long haul in mind.
Fund-of-Funds vs. Endowments: Know Your LP Type
Fund-of-funds move faster but think shorter-term. Caleb explained the key difference:
Fund-of-funds themselves have clients and LPs and are fundraising around that… they’re on the margins more willing to take some emerging risk, or some vintage risk.
Endowments like Hopkins think differently.
If we’re churning managers out of our portfolio, we kind of view that as something about failure in the selection process
Whereas fund-of-funds expect some natural attrition from Fund 2 to Fund 3. Michelle learned this the hard way:
You sort of have to figure out the right timing, or you just might be subject to the wrong timing of when they’re fundraising and when their allocations are going to be open.
The tactical takeaway? Just ask directly.
Michelle’s advice: “Are you planning on adding new managers? When do you think that timeline will be?” People will usually give you a straight answer.
The Education Challenge for Novel Strategies
Both Michelle (hardware/defense) and Megan (creator investing) faced the reality that some LPs simply won’t be convinced, no matter what you show them.
Michelle was blunt about hardware skeptics:
There was sort of nothing that was gonna convince them. I could send them articles, I could send them lots of things… there was just nothing.
For the Creator Fund, education was even more intensive.
Megan had to explain everything from sourcing mechanisms to exit strategies—questions that “are just assumed in probably a regular fundraise.”
The key insight: Find LPs who are already somewhat believers in your category, then convince them why you’re the best fit.
References Are Everything (And They’re Everywhere)
This might be the most important section for emerging managers to understand.
Michelle put it simply: “References are probably the most important part of the whole diligence process.”
But here’s what many don’t realize—LPs don’t just call your provided references.
“Don’t put anyone in any material, like, anywhere in your data room or anything that you don’t want to be called, and people will also just go through your LinkedIn and call people.”
Caleb confirmed this: “It immediately gives us somebody to reference… It’s our job to try to knock holes in the thesis, right?”
The back-channel references carry the most weight because “those are the ones that aren’t handed up to them in a silver platter.”
Time Horizon Reality Check
The biggest adjustment emerging managers need to make? Time expectations.
Michelle nailed the fundamental mismatch:
Every day for me feels like a week. Every month for an LP is like a day. So, like, there’s just, like, a mismatch in, like, time horizons.
Her solution: “Regular, like, roughly monthly update emails, super helpful way to, like, stay top of mind, show progress, show that you are doing what you said you’re gonna do.”
The institutional LP world operates on relationship timelines, not transaction timelines.
Understanding that fundamental difference—and adjusting your approach accordingly—can make the difference between a successful institutional fundraise and spinning your wheels for months.
