Beyond the Name Tag: The Real ROI of Capital Conferences for Emerging Funds
The journey of raising capital is fraught with challenges, especially for emerging managers in venture capital (EMVC) with Funds I, II, and III. Conferences have long been touted as fertile grounds for networking and fundraising, yet, the effectiveness of these gatherings as a platform for securing investment from Limited Partners (LPs) is a topic of intense debate among industry insiders.
It is said of EMVC funds that Fund I is raised on promise and potential, Fund II on execution, and Fund III on returns. Many General Partners (GPs) will tell you that a would-be new fund manager needs to be able to raise that first fund from their personal network, which is not possible for everyone. Where does Fund II come from then? What about Fund III? Where do you start? The statistics are sobering — only 17% of first-time funds make it to a fourth fund, suggesting a high attrition rate among new entrants. The question then arises: are conferences a worthwhile pursuit for raising capital?
The Good
Capital conferences promise unparalleled access to a congregation of decision-makers, ranging from institutional investors to family offices. The allure is obvious: nowhere else might one find such a concentrated pool of potential funders gathered with the intent to explore new opportunities. For emerging fund managers, these events offer a rare promise to pitch, network, and align with the global investment community's pulse.
The Bad
However, the reality of these conferences can be starkly different. Talk to anyone who has attended a capital conference in the past few years, and they will tell you that it is not a silver bullet for fundraising, especially for those without an existing pipeline of relationships. From the fake family offices to the questionably executed events, the environment is best described as a gamble on both time and money. At the RAISE conference a few years ago, the overwhelmed limited partners wore their name tags backward, a small but telling sign of the hectic pace and high-pressure environment they navigated throughout the event. From our friends who are out there in the thick of it, the 2024 conference circuit is particularly gnarly, as reflective of the market. Fund Is that started in 2021 are now out there trying to close their respective Fund IIs ~ the “baby boom of venture,” resulting in particularly poor GP/LP ratio at events these days.
Conferences are great in theory — offering a blend of networking, learning, and visibility. Yet, the devil is in the details. The return on investment, particularly the time invested, often does not match the outcomes. Managers end up stalking potential LPs, a strategy that might seem desperate and is rarely effective. If you do not have a pipeline, a conference is not a good place to start one, but, if you do have a pipeline, it is a great opportunity to touch base with folks and potentially interact with hundreds of people to warm up those relationships.
Execution
It is safe to assume that your level of success at a conference or event will be a function of the number of people that you know and the amount of time you spend preparing. Thoughtful prep includes spending a good deal of time with the registration list, carrying out in-depth research on those 20% of names that are likely to drive 80% of value, and developing pathways of connectivity to high potential contacts, such as direct cold outreach, warm intro, and timely impetus for catch up conversation.
Tackling a conference with a similarly motivated peer can help get the flywheel effect going at an event and reduce the risk that you simply miss some of the best contacts. While this often happens organically, thoughtful preparation and coordination with complementary and friendly VCs can amplify the ROI on a given event exponentially. Once you are at an event, turn on your extroversion and try to avoid a defeatist attitude. If you can see peers that are having a good time and driving positive ROI, challenge yourself to do the same. Positive outcomes can be extracted from most events, and your energy and effort levels are significant factors.
Selection
For those who decide to tread the conference path, choosing the right venue becomes paramount. Such high-profile events provide a platform to engage directly with a broad audience, including institutional investors — a critical audience for emerging managers seeking to transition to a more institutionalized investor base. These relationships are begun early and nurtured over time. Know that you are playing the long game.
Be meticulous in your selection process. Emerging managers need to focus on conferences that align well with their fund's focus and have a reputable track record of facilitating genuine investor connections. Preparation is key; understanding the profile and investment philosophy of attending LPs can tailor pitches and interactions to resonate more deeply with potential investors. If there is a conference you are considering, make it a point of gathering perspective from at least two peers that have first-hand experience with that series. If you do not have existing relationships that have attended, ask the conference organizers for references or warm introductions to VCs/fund managers that can vouch for the event. While it is a good idea and clever tactic to ask LPs about conferences that they find valuable, do not forget that their perspective is likely to be skewed by conference dynamics.
Try to establish your conference calendar 12 months in advance and build weeks around the events that require travel. The secondary and tertiary meetings, outside the event itself, might ultimately drive ROI and underwrite the week, however that only happens if you are planning far out in advance.
The real work often begins after the conference. This involves prompt communication, personalized follow-ups, and continuous engagement to keep the fund top-of-mind among the potential investors met at these events. After meeting a potential investor at a conference, follow up within 24-48 hours with a personalized email that references specific details from your conversation and expresses gratitude. Suggest a clear next step, such as a phone call or meeting, to discuss your pitch further and reinforce the value of your opportunity. Effective follow-up is crucial to convert initial contacts into meaningful relationships and, eventually, into investment commitments.
In Conclusion
While the efficacy of conferences as a fundraising platform is contested, they can still serve as valuable arenas for networking and learning if approached with the right strategy. For emerging venture capital fund managers, the key lies in selective participation, thorough preparation, and diligent follow-up. These elements form the bedrock of turning occasional interactions into lasting partnerships and securing the much-needed capital to propel a fund forward.
As emerging managers navigate the complex terrain of venture capital fundraising, understanding the nuanced dynamics of these events can make the difference between mere attendance and meaningful engagement. If you choose to attend this year, please let us know what you think of the specific conference, opportunity, and attendees ~ we would love to hear from you!
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Sincere appreciation to our contributors Jennifer Band of InRider Partners, John Czerwionka of Spur Capital, and Ed Stubbings of Ternion, written along with Shea Tate-Di Donna and Kaego Ogbechie Rust, authors of The Venture Fund Blueprint.
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Disclaimer: The providers, companies, examples, products, and services shared represent only a subset of available options and are based solely on internal fund manager conversations. These options are intended to be a general framework, not an exhaustive catalog, and should not be viewed as legal or tax advice, endorsements, recommendations, approvals, or rankings. We encourage you to do additional research into each category to find the resources that best fit your specific needs.
