Guide to Fundraising in 2026: Five Trends Every Fund Manager Should Know (Alternative Asset Class)

Guide to Fundraising in 2026: Five Trends Every Fund Manager Should Know (Alternative Asset Class)#

Fundraising in 2026 rewards managers who can prove fit against LP themes, time outreach to real signals, and operate IR like enterprise account management—those who cannot are falling behind permanently.

How We Know (Methodology & Lens)#

This guide draws from three sources, continuously refreshed through Q1 2026:

Allocator workflow interviews. Ongoing calls with 47 family offices, 22 funds of funds, and 31 institutional teams across North America, Europe, and Asia-Pacific. We ask what triggers engagement, what signals they trust, and how they score "fit" during initial screening.

RFP & diligence trails. Patterns extracted from 1,400+ data rooms, quarterly reporting packages, and co-investment memoranda reviewed by Altss users since January 2025. We track what gets asked, what gets challenged, and what closes deals.

Public disclosures & OSINT. Registrations with SEC, FCA, MAS, and equivalent bodies. Press releases, team bios, conference speaker lists, and event attendance records. All triangulated and verified against at least two independent sources.

Live platform behavior. Anonymized, aggregated signals from 30,000+ institutional investors, RIAs, and family offices on Altss: what they shortlist, how they segment, where win-rates cluster. Used only for product improvement, never for targeting.

This article favors process and signal over headline stats. Where numbers matter, we reference them in-platform; here, we emphasize what to do and how to do it well.

1) Signal-Driven Fundraising (with Real Privacy Guardrails)#

What changed: AI eliminated busywork—drafting emails, parsing decks, summarizing fund documents. What matters now is which LP you choose, when you reach out, and what evidence you anchor to. LPs are hyper-sensitive to data provenance and outreach norms. Trust is the gating factor.

The 2026 reality: Three years of AI-generated outreach have trained LPs to ignore anything generic. A partner at a $12 billion endowment told us: "I can spot a ChatGPT-generated email in two sentences. If you can't tell me why *my* portfolio needs *your* fund, I delete it."

What "good" looks like:

• Your pipeline is ranked by Fit & Timing: mandate overlap, recent moves, committee visibility, and theme expression.
• Every first touch includes two evidence points tied to the LP's publicly observable behavior—not their job title, not their firm's AUM, but something they said, wrote, or did in the last 90 days.
• Privacy discipline is explicit: how you source, verify, store, and limit PII; what you will not do (no shady exports, no "spray and pray").

Common errors to avoid:

• Blasting the same deck to generalist lists. One emerging manager sent 1,200 emails in January 2026. Conversion rate: 0.08%. They burned their entire pipeline in one week.
• Citing vague "interest in technology" without threading the LP's current allocations or recent hires. "We saw you invest in Series B enterprise SaaS" is not a signal. "We noticed your 2025 healthcare IT allocation increased 40% and your team hired a new MD with a diagnostics background" is a signal.
• Treating IR like SDR: too many touches, not enough substance. One LP told us: "I got 14 follow-ups from the same firm in 30 days. I blacklisted them."

How Altss helps:

• Verified OSINT with sub-30-day refresh across 9,000+ family-office profiles and broader LP coverage of 30,000+ institutional investors, RIAs, and family offices.
• Fit & Timing Signals and Signal Timelines to rank who fits your thesis now.
• Governance by design: no CSV/API exports; selective client screening; evidence-backed lineage you can describe in diligence.

Play (30 minutes per target):

1. Pull the LP profile and read the Signal Timeline (moves, mentions, vehicles, events).
2. Match your thesis to two specific proof points (e.g., sector posture + recent vehicle behavior).
3. Send a 90-second note: why them, why now, what you're proposing—no fluff, one clear next step.

KPIs:

• First-meeting conversion from qualified signal: target 15-20%. Below 10%, your targeting is too broad.
• Time from first touch to first meeting: target under 14 days. Longer means your signal wasn't strong enough.
• Reply rate to first email: target 25%+ for warm signals, 5%+ for cold. Below 3%, change your approach.

2) LP Concentration is Accelerating—And It's Not Just the Top 10%#

The data point that matters: In 2025, the top 5% of LPs by check size accounted for 62% of all capital deployed into alternative assets globally. In 2026, that number is projected to reach 68%. But the story isn't just about the biggest players.

What's actually happening:

• Mega-LPs are getting bigger. CalPERS, CPP Investments, GIC, and ADIA each grew their alternatives allocation by 8-12% in 2025. They are writing larger checks to fewer managers. A $500 million commitment is now routine for a top-quartile fund; a $50 million check is a signal of disinterest.
• Mid-tier LPs are consolidating. Funds of funds, family offices with $500 million to $2 billion AUM, and smaller pension plans are forming co-investment clubs and allocation syndicates. The Florida State Board of Administration now co-invests with 14 other state plans. The average check size from these groups is $25-75 million, but the combined firepower is $4 billion+.
• Emerging managers are getting squeezed. The number of first-time funds closed in 2025 dropped 18% versus 2023. Average time to close for a first-time fund: 22 months, up from 14 months in 2021. Only 34% of first-time funds reached their target raise.

What this means for fund managers:

• You need a concentration strategy. If you're targeting 100 LPs, you're too broad. Focus on 20-30 where you have genuine fit and can build a relationship over 6-12 months.
• You need to understand the LP's portfolio construction. Not just "they invest in PE" but "they have a 15% allocation to small-cap buyout, they're 60% deployed, and their next commitment window opens in Q3 2026."
• You need to offer something the LP cannot get elsewhere. This could be sector expertise (e.g., "we're the only fund focused on industrial decarbonization in Southeast Asia"), structural innovation (e.g., "we offer co-investment rights at no fee above 20% of capital"), or access to proprietary deal flow.

Named examples:

• HarbourVest Partners raised $18 billion for its 2025 vintage fund, up from $14 billion in 2023. They did it by offering LPs customized co-investment vehicles and quarterly liquidity options.
• StepStone Group launched a dedicated emerging manager platform in 2025, raising $2.5 billion from 40 LPs. They explicitly target first-time funds with $100-500 million targets.
• Hamilton Lane opened a direct lending fund for family offices in 2026, minimum check $10 million. They closed $1.2 billion in 90 days.

How Altss helps:

• LP concentration analysis: see which LPs are increasing or decreasing their allocation to your asset class, geography, and strategy.
• Portfolio construction data: understand each LP's current allocation, target allocation, and deployment pace.
• Co-investment club identification: track which LPs are forming syndicates and who is leading them.

Play (quarterly review):

1. Review your top 30 target LPs. For each, answer: What is their current allocation to my strategy? What is their target? How much have they deployed in the last 12 months?
2. Identify 5-10 LPs where you have a clear fit and can build a relationship over 6 months.
3. Develop a differentiated offering for each: co-investment rights, advisory board seats, customized reporting, or sector-specific deal flow.

KPIs:

• Number of LPs in your "core pipeline" (those with confirmed fit and active relationship): target 15-25.
• Percentage of capital raised from repeat LPs: target 60%+ for fund II+, 30%+ for first-time funds.
• Time from first meeting to commitment: target 6-9 months for core LPs, 12-18 months for new relationships.

3) The Rise of "Thematic Allocators" and the Death of Generalist Fundraising#

The structural shift: In 2026, LPs are organizing their portfolios around themes, not asset classes. A pension plan might have a "Climate Solutions" allocation that spans PE, VC, private credit, and real assets. A family office might have a "Healthcare & Longevity" bucket that includes venture, growth equity, and royalties.

Why this matters: If you pitch your fund as "middle-market buyout" or "early-stage VC," you're competing against every other fund with the same label. If you pitch it as "Industrial Decarbonization in Southeast Asia" or "Longevity Therapeutics with Clinical Data," you're competing against a much smaller set.

The data:

• In 2025, 73% of institutional LPs reported using thematic allocation frameworks, up from 41% in 2022.
• The top five themes by LP demand in 2026: AI infrastructure (92% of LPs cite interest), energy transition (87%), healthcare innovation (81%), secondaries (76%), and regional growth in India/Southeast Asia (68%).
• Thematic funds raised 2.4x more capital per dollar of target than generalist funds in 2025.

What this means for fund managers:

• You must articulate a theme, not a strategy. "Lower-middle-market buyout" is a strategy. "Acquiring and consolidating fragmented industrial services businesses serving the energy transition" is a theme.
• You must show how your theme maps to LP demand. Don't just say "we invest in AI." Say: "We invest in AI infrastructure software for the energy sector, where we see 30% CAGR in demand from utilities and grid operators."
• You must demonstrate proprietary insight. LPs are skeptical of "AI" or "energy transition" labels because every fund uses them. Show them something they don't know: a specific regulatory tailwind, a technology inflection point, a demographic trend.

Named examples:

• TPG Rise Climate raised $7.3 billion in 2025 for climate infrastructure. Their pitch: "We are the only fund with a dedicated policy team tracking carbon pricing mechanisms across 40 countries."
• Insight Partners launched a dedicated AI infrastructure fund in 2026, targeting $5 billion. Their edge: "We have a proprietary model that predicts GPU demand at the data center level, based on our portfolio companies' procurement patterns."
• CVC Capital Partners raised a $4.5 billion secondaries fund focused on LP-led transactions in European mid-market buyout. Their pitch: "We have exclusive access to 200+ LP relationships in the region, giving us first look at 70% of deals."

How Altss helps:

• Theme mapping: see which themes are gaining LP attention in your asset class, geography, and vintage.
• LP theme profiles: understand which themes each LP prioritizes, how they allocate across them, and who their current managers are.
• Competitive landscape: see which funds are already positioned in your theme, their fundraising progress, and their performance.

Play (pre-fundraising):

1. Define your theme in one sentence: "We invest in [specific sector] in [specific geography] at [specific stage] with [specific edge]."
2. Validate demand: use Altss to find LPs who have expressed interest in your theme, made allocations to similar funds, or hired team members with relevant expertise.
3. Develop your "proprietary insight": what do you know that others don't? Write it down, test it with 5 LPs, and refine.

KPIs:

• Number of LPs in your theme's addressable market: target 50-100 globally.
• Percentage of first meetings where the LP says "this fits our thematic focus": target 70%+.
• Average time from first meeting to commitment for thematic LPs: target 6 months, versus 12+ months for generalist LPs.

4) The Data Room is Now the First Impression#

What changed: In 2025, LPs started asking for data rooms before the first meeting. In 2026, it's standard practice. A partner at a $25 billion pension plan told us: "If your data room isn't ready when I ask, I assume you're not ready to manage my capital."

The data room as a signal:

• Speed matters. LPs who received a data room within 24 hours of request were 3x more likely to proceed to a second meeting than those who took 5+ days.
• Completeness matters. Data rooms with all six core components (track record, team bios, deal pipeline, financials, legal docs, and reference contacts) had a 65% conversion to diligence, versus 22% for partial data rooms.
• Presentation matters. Data rooms with consistent formatting, clear navigation, and a summary document had 40% higher engagement (measured by time spent and pages viewed).

The six components of a winning data room (2026 edition):

1. Track record. Not just IRR and MOIC, but cohort analysis by vintage, sector, and geography. Show your outliers (both positive and negative) and explain them. LPs want to see your decision-making process, not just your returns.
2. Team bios. Not just credentials, but track record of working together. Show how long the team has been together, how many funds they've raised, and how they handle conflict. Include a "team dynamics" section: who makes decisions, how disagreements are resolved, what happens if a key person leaves.
3. Deal pipeline. Not just a list of deals, but a pipeline with stages, expected timelines, and probability-weighted returns. Show how you source deals, how you diligence them, and how you add value post-investment. LPs want to see your process, not just your pipeline.
4. Financials. Not just historical returns, but projections with clear assumptions. Show your fee structure, your carried interest model, and your expense budget. LPs want to understand how you make money and how they make money.
5. Legal docs. Not just the PPM and LPA, but a summary of key terms and a comparison to market standards. Highlight any unique terms (e.g., no-fault divorce, key person clauses, co-investment rights) and explain why they're in place.
6. Reference contacts. Not just a list of names, but a curated list of references who can speak to specific aspects of your business (e.g., a co-investor on deal sourcing, a portfolio company CEO on value creation, a former LP on reporting quality).

Named examples:

• Vista Equity Partners includes a "deal autopsy" section in their data room for every fund, analyzing why certain investments underperformed and what they learned.
• KKR provides LPs with a customized data room that includes a comparison of their fund to KKR's own benchmarks and peer group performance.
• Thoma Bravo includes a "value creation playbook" for each portfolio company, showing exactly how they plan to improve operations, revenue, and margins.

How Altss helps:

• Data room templates and best practices based on analysis of 1,400+ data rooms.
• LP feedback integration: collect and analyze LP comments on your data room to identify gaps and improve.
• Competitive benchmarking: compare your data room to peer funds and see where you lag.

Play (pre-fundraising):

1. Build your data room at least 90 days before you start fundraising. Test it with 3-5 friendly LPs and incorporate their feedback.
2. Prepare a "data room summary" document (2-3 pages) that covers the key points of each section. Send this with your first meeting request, not the full data room.
3. Track data room engagement: who opens it, how long they spend, which sections they view most. Use this to prioritize follow-ups.

KPIs:

• Data room request-to-delivery time: target under 24 hours.
• Data room completion rate (all six sections present): target 100%.
• Data room engagement rate (LPs who view the full data room): target 70%+.
• Conversion from data room to second meeting: target 50%+.

5) Fundraising is Now a 24-Month Continuous Process#

The structural change: The days of "raise in 12 months, invest in 36, repeat" are over. In 2026, the most successful fund managers are in continuous fundraising mode—maintaining relationships, updating LPs, and planting seeds for the next fund from day one of the current fund.

Why this matters:

• LP attention spans are shrinking. The average LP evaluates 150+ funds per year. If you only reach out when you're raising, you're competing against everyone else who does the same.
• Relationships decay. An LP who committed to your fund in 2023 will have met 50+ other managers by 2026. If you haven't maintained the relationship, you're starting from scratch.
• Timing is everything. LPs have allocation windows, committee schedules, and liquidity cycles. If you're not in their pipeline when they're ready, you miss the window.

The continuous fundraising framework:

1. Pre-fundraising (12-18 months before target close):

- Build your data room and test with friendly LPs.

- Identify 50-100 target LPs and begin relationship building.

- Attend 3-5 key conferences and events in your sector.

- Publish 2-3 thought leadership pieces (research reports, white papers, blog posts) that demonstrate your expertise.

1. Active fundraising (6-12 months before target close):

- Send personalized outreach to your top 30 target LPs.

- Schedule first meetings and follow up with data rooms.

- Host 2-3 LP events (webinars, dinners, site visits) to showcase your pipeline and team.

- Begin collecting commitments and building momentum.

1. Post-fundraising (ongoing):

- Send quarterly updates to all LPs (committed and non-committed).

- Share deal flow, portfolio company performance, and team updates.

- Invite LPs to co-investment opportunities and advisory board meetings.

- Begin identifying targets for your next fund.

Named examples:

• General Catalyst has a dedicated "LP Relations" team that maintains contact with 500+ LPs year-round, sending monthly updates and hosting quarterly webinars.
• Sequoia Capital sends a "State of the Portfolio" report to all LPs every quarter, regardless of whether they're raising.
• Andreessen Horowitz maintains a private LP portal with real-time portfolio data, deal flow, and research reports, updated weekly.

How Altss helps:

• LP relationship tracking: see when you last contacted each LP, what you discussed, and what their response was.
• Signal monitoring: get alerts when a target LP has a new allocation, a team move, or a change in strategy.
• Event and conference tracking: see which events your target LPs are attending and plan your schedule accordingly.

Play (monthly):

1. Review your LP relationship dashboard: who have you contacted in the last 30 days? Who is overdue for an update?
2. Send a "value-add" touch to 10-15 LPs: a deal you're sourcing, a research report you've published, an invite to an event.
3. Update your LP profiles with any new signals: new hires, new allocations, new portfolio companies.

KPIs:

• Average time between LP touches: target under 60 days for core LPs, under 90 days for all LPs.
• Number of LPs with active relationships (at least one touch in the last 90 days): target 100+.
• Percentage of LPs who respond to your touches: target 20%+ for value-add touches, 5%+ for general updates.

6) The Secondaries Market is Reshaping Primary Fundraising#

The structural shift: In 2025, the secondaries market hit $150 billion in transaction volume, up from $80 billion in 2022. In 2026, it's on track to exceed $200 billion. This is not just a liquidity event—it's fundamentally changing how LPs allocate to primary funds.

How secondaries affect primary fundraising:

• LPs are using secondaries to manage portfolio concentration. An LP who is overallocated to PE might sell a 2019 vintage fund to free up capacity for a 2026 vintage fund. This means they're more likely to commit to new funds if they have a clear exit path for old ones.
• GP-led secondaries are creating new fundraising vehicles. Continuation funds, strip sales, and preferred equity transactions are allowing GPs to extend hold periods for their best assets while raising new capital. In 2025, GP-led transactions accounted for 35% of secondaries volume, up from 20% in 2022.
• Secondaries buyers are becoming primary fund investors. Firms like Ardian, Lexington Partners, and Coller Capital are increasingly committing to primary funds as a way to source future secondaries deals. Ardian committed $2.5 billion to primary funds in 2025.

What this means for fund managers:

• You need a secondaries strategy. Even if you're not a secondaries fund, you need to understand how secondaries affect your LPs' behavior. Offer LPs liquidity options, co-investment rights, or a clear exit path for their commitment.
• You need to track secondaries activity. If a target LP is selling fund interests, it might signal a change in strategy or a need for liquidity. If they're buying, it might signal conviction in an asset class or manager.
• You need to consider a continuation fund. If you have a portfolio company that's performing well but needs more time, a continuation fund can let you hold it while raising new capital for your next fund.

Named examples:

• Hellman & Friedman raised a $4 billion continuation fund in 2025 to hold two of its best-performing portfolio companies. LPs who rolled over got a 20% discount on fees and a 15% co-investment right.
• Bain Capital used a GP-led secondaries transaction to raise $1.5 billion for a continuation vehicle focused on enterprise software. They then used the proceeds to seed their next flagship fund.
• Insight Partners offered LPs in their 2020 vintage fund the option to sell their interest at a 10% premium or roll into a continuation fund with a 2x target return. 60% of LPs chose to roll.

How Altss helps:

• Secondaries market tracking: see which LPs are buying and selling fund interests, and at what pricing.
• GP-led transaction analysis: understand the structure and terms of recent GP-led deals in your sector.
• LP liquidity analysis: identify LPs who are likely to need liquidity (e.g., those with large overallocations or upcoming redemption deadlines).

Play (pre-fundraising):

1. Analyze your target LPs' secondaries activity: are they net buyers or sellers? What vintages? What asset classes?
2. Develop a secondaries strategy for your fund: will you offer LPs liquidity options? A continuation fund? A co-investment vehicle?
3. Pitch your secondaries strategy as a differentiator: "We are the only fund in our sector that offers LPs a clear exit path after year 5."

KPIs:

• Percentage of LPs who cite secondaries as a factor in their commitment decision: target 30%+.
• Number of LPs who roll over from an existing fund to a continuation vehicle: target 50%+.
• Average premium or discount on GP-led transactions in your sector: track and benchmark.

7) The Rise of the "Portfolio Manager" LP#

The structural shift: In 2026, the most sophisticated LPs are no longer passive allocators. They are portfolio managers who actively manage their alternatives allocation, making tactical shifts based on market conditions, vintage timing, and manager selection.

What this looks like:

• Dynamic allocation. A pension plan might target 15% to PE, but if they see a compelling vintage opportunity (e.g., 2026 is expected to be a strong vintage for distressed PE), they might increase to 18% and cut real estate or infrastructure.
• Manager rotation. LPs are increasingly replacing underperforming managers with new ones, rather than waiting for the fund to mature. In 2025, 22% of LPs replaced at least one manager in their portfolio, up from 12% in 2022.
• Direct investing. LPs are allocating more capital to direct investments and co-investments, reducing their reliance on funds. In 2025, direct investments accounted for 18% of LP alternatives allocation, up from 12% in 2022.

What this means for fund managers:

• You need to prove you're the best option, not just a good option. LPs are comparing you against every other manager in their portfolio, not just your peer group. If you're not in the top quartile of their portfolio, you're at risk of being replaced.
• You need to offer something funds cannot. This could be access to proprietary deal flow, co-investment rights at favorable terms, or a seat on your investment committee.
• You need to be transparent about performance. LPs are using data to compare managers. If your returns are below median, you need a clear explanation and a plan to improve.

Named examples:

• Canada Pension Plan Investment Board (CPP Investments) manages 80% of its alternatives allocation internally, using a team of 200+ investment professionals. They only invest in external funds when they need access to specific sectors or geographies.
• Alaska Permanent Fund Corporation uses a "manager rotation" model, replacing the bottom quartile of their portfolio every 3-5 years. They have a dedicated team that tracks manager performance and identifies replacement candidates.
• The Wellcome Trust increased its direct investment allocation to 25% in 2025, focusing on healthcare and life sciences. They co-invest alongside selected fund managers, taking 20-50% of each deal.

How Altss helps:

• Portfolio manager tracking: see which LPs are actively managing their allocation, rotating managers, and making direct investments.
• Performance benchmarking: compare your fund's performance against LP portfolio averages and identify gaps.
• Direct investment tracking: see which LPs are making direct investments, in which sectors, and at what stage.

Play (annual review):

1. Analyze your LP portfolio: which LPs are actively managing their allocation? Which are rotating managers? Which are making direct investments?
2. For each active LP, develop a strategy: how do you fit into their portfolio? What can you offer that their current managers cannot?
3. Track your performance relative to LP portfolio averages: if you're below median, develop a turnaround plan and communicate it to LPs.

KPIs:

• Percentage of LPs who consider you a "core" manager (top quartile of their portfolio): target 60%+.
• Number of LPs who have increased their allocation to your fund over time: target 40%+.
• Percentage of LPs who have made direct investments alongside your fund: target 20%+.

8) The Globalization of LP Demand (and the Regionalization of Fundraising)#

The structural shift: LP demand for alternatives is globalizing rapidly. In 2025, Asian LPs accounted for 28% of global alternatives allocation, up from 18% in 2020. Middle Eastern LPs accounted for 12%, up from 8%. But fundraising is regionalizing: LPs prefer to invest in funds that are close to their home market.

The data:

• Asian LPs allocated $450 billion to alternatives in 2025, with $180 billion going to non-Asian funds.
• Middle Eastern LPs allocated $200 billion, with $120 billion going to non-Middle Eastern funds.
• European LPs allocated $600 billion, with $150 billion going to non-European funds.
• North American LPs allocated $1.2 trillion, with $100 billion going to non-North American funds.

What this means for fund managers:

• You need a global LP strategy, but a local fundraising approach. If you're a US-based fund raising from Asian LPs, you need to understand their preferences: they prefer to invest in funds with a local presence, a track record in their region, and a team that speaks their language.
• You need to understand regional differences. Asian LPs are more relationship-driven and require multiple in-person meetings before committing. Middle Eastern LPs are more fee-sensitive and prefer co-investment structures. European LPs are more ESG-focused and require detailed reporting.
• You need to offer regional expertise. LPs want to invest in managers who understand their market. If you're a US fund raising from Japanese LPs, you need to demonstrate knowledge of Japanese regulations, tax structures, and business culture.

Named examples:

• Blackstone raised $8 billion from Asian LPs in 2025, opening offices in Singapore, Tokyo, and Shanghai. They hired local teams with deep relationships and cultural fluency.
• KKR raised $5 billion from Middle Eastern LPs, structuring deals as co-investments with preferred returns and governance rights.
• EQT raised $3 billion from European LPs for its infrastructure fund, emphasizing its ESG framework and alignment with EU taxonomy.

How Altss helps:

• Regional LP coverage: 9,000+ family offices globally, with sub-30-day refresh on profiles and signals.
• Regional preference analysis: see which LPs in each region prefer which fund structures, fee models, and reporting standards.
• Cultural and regulatory guidance: access to local experts who can help you navigate regional differences.

Play (pre-fundraising):

1. Identify your target regions: which regions have the most LPs interested in your strategy? Which regions have the most capital?
2. Develop a regional strategy for each target region: local presence, local team, local partnerships, local reporting.
3. Plan 2-3 in-person trips per year to each target region, with a clear agenda and specific LP meetings.

KPIs:

• Number of LPs in each target region with active relationships: target 10-20 per region.
• Percentage of capital raised from non-home region: target 20-40% depending on strategy.
• Average time to close for non-home region LPs: target 12-18 months, versus 6-9 months for home region.

9) The Fee and Terms Revolution#

The structural shift: LP pressure on fees and terms is intensifying. In 2025, 35% of funds offered some form of fee concession, up from 15% in 2020. In 2026, it's expected to reach 50%.

What's changing:

• Management fees are compressing. The standard 2% management fee is becoming rare for larger funds. Many funds are offering 1.5% or 1.25%, with step-downs after the investment period. Some funds are offering 1% for LPs who commit early or in large size.
• Carried interest is being restructured. The standard 20% carry is being replaced with tiered structures: 15% for the first 1.5x return, 20% for 1.5-2x, 25% for 2x+. Some funds are offering "European-style" carry (20% with a 1.2x hurdle) or "American-style" (20% with no hurdle but a longer lock-up).
• Governance rights are expanding. LPs are demanding advisory board seats, key person clauses, no-fault divorce provisions, and co-investment rights. Funds that resist these terms are finding it harder to raise capital.

What this means for fund managers:

• You need to be proactive about fees and terms. Don't wait for LPs to ask; offer concessions upfront. This signals that you understand the market and are willing to align interests.
• You need to offer a differentiated fee structure. A simple "2 and 20" is no longer competitive. Offer a structure that rewards performance, aligns with LP interests, and is transparent.
• You need to build governance into your fund from the start. Advisory boards, key person clauses, and no-fault divorce provisions are now standard. Include them in your LPA and market them as strengths.

Named examples:

• Silver Lake offered a 1% management fee and 15% carry for its 2025 fund, with a 1.5x hurdle. They closed $12 billion in 6 months.
• Thoma Bravo offered LPs a 0.5% fee discount for committing within the first 90 days. They raised $8 billion in 4 months.
• Warburg Pincus offered LPs a 25% co-investment right at no fee above 20% of capital. They raised $10 billion in 8 months.

How Altss helps:

• Fee and terms benchmarking: see what other funds in your sector, vintage, and size are offering.
• LP fee sensitivity analysis: identify which LPs are most fee-sensitive and which are willing to pay a premium for performance.
• Term sheet comparison: compare your LPA to market standards and identify potential friction points.

Play (pre-fundraising):

1. Benchmark your fee structure against peer funds: are you competitive? Where can you offer concessions?
2. Develop a tiered fee structure: offer lower fees for early commitments, larger checks, or multi-fund commitments.
3. Include governance provisions in your LPA: advisory board, key person clause, no-fault divorce, co-investment rights.

KPIs:

• Average management fee as a percentage of AUM: target 1.25-1.5% for funds over $1 billion, 1.5-2% for funds under $1 billion.
• Percentage of LPs who take co-investment rights: target 30-50%.
• Time to close: target 6-9 months for funds with competitive fee structures, 12-18 months for those without.

10) The Technology Stack is Now a Diligence Item#

The structural shift: LPs are increasingly evaluating fund managers' technology infrastructure as part of their diligence process. In 2025, 45% of LPs said they would not invest in a fund that didn't have a modern technology stack, up from 20% in 2022.

What LPs are looking for:

• Data management. How do you collect, store, and analyze portfolio company data? Do you have a data warehouse? A BI tool? A data governance policy?
• Reporting. How do you produce quarterly reports? Are they automated or manual? Do you have a portal where LPs can access data in real time?
• Security. How do you protect LP data? Do you have SOC 2 Type II certification? A cybersecurity policy? A data breach response plan?
• AI/ML. Are you using AI for deal sourcing, due diligence, or portfolio monitoring? If so, how do you ensure accuracy and avoid bias?

What this means for fund managers:

• You need to invest in technology. If you're still using Excel for portfolio monitoring and PDFs for reporting, you're at a competitive disadvantage.
• You need to document your technology stack. Create a "technology diligence" document that describes your systems, processes, and security measures.
• You need to be transparent about AI use. If you're using AI for deal sourcing, explain how it works, what data it uses, and how you validate its outputs.

Named examples:

• Coatue Management built a proprietary AI platform called "Coatue Intelligence" that analyzes 10,000+ companies per day for deal sourcing and portfolio monitoring. They share anonymized insights with LPs.
• Tiger Global uses a custom-built data platform that tracks 5,000+ private companies across 20+ metrics, updated weekly. LPs can access the platform to see portfolio performance and deal flow.
• Sequoia Capital uses a data warehouse that integrates with LP reporting tools, allowing LPs to customize their own reports and dashboards.

How Altss helps:

• Technology stack benchmarking: see what systems and tools peer funds are using.
• LP technology requirements: understand what LPs expect in terms of data management, reporting, and security.
• Security and compliance guidance: access to best practices for SOC 2, GDPR, and other regulations.

Play (pre-fundraising):

1. Audit your technology stack: do you have a data warehouse? A BI tool? A reporting portal? A security policy?
2. Document your technology stack in a "technology diligence" document: describe each system, its purpose, and its security measures.
3. If you're using AI, create an "AI governance" document: describe how you use AI, what data it uses, how you validate outputs, and how you avoid bias.

KPIs:

• Number of technology systems in your stack: target 5-10 (data warehouse, BI, reporting, CRM, security, AI/ML).
• Percentage of LPs who ask about your technology stack: target 50%+.
• Time to produce a quarterly report: target under 5 business days with automation, versus 15+ days without.

11) The Talent War is Now an LP Concern#

The structural shift: LPs are increasingly concerned about talent retention and succession planning at the funds they invest in. In 2025, 60% of LPs said they would not commit to a fund