Materials Sequencing Strategy
Optimal order and timing for sharing fundraising materials: initial deck (first meeting), PPM (serious interest), DDQ (active diligence), track record (due diligence), side letters (commitment).
Proper sequencing balances transparency with information control—premature detail overwhelms; delayed disclosure signals hiding concerns.
Expanded Definition
Materials sequencing follows: teaser/deck (first meeting: strategy overview, team, high-level track record), PPM (after positive second meeting: full strategy, detailed terms, risk factors), DDQ (active diligence: comprehensive operational questions), track record detail (diligence/IC preparation: deal-level performance, attribution), fund documents (legal review: LPA, sub docs), side letter negotiations (commitment: bespoke terms).
Sequencing principles: interest before detail (don't overwhelm with PPM at first meeting), trust before transparency (save sensitive track record until serious), official before bespoke (standard docs before side letters), context before complexity (deck overview before legal documents). Exceptions exist for sophisticated repeat LPs (faster sequencing) and regulated LPs (early DDQ/compliance requirements).
Signals & Evidence
Sequencing optimization factors:
- LP sophistication: Repeat LPs can handle faster sequencing; first-time LPs need gradual progression
- Interest level: Enthusiastic LPs warrant faster sequencing; skeptical LPs need slower progression with relationship building
- Decision stage: Each pipeline stage has appropriate materials (engagement = deck; diligence = DDQ; commitment = legal docs)
- Sensitive info: Delay proprietary details (specific positions, returns attribution) until trust established
- Regulatory requirements: Some LPs (ERISA, European pensions) need early compliance documentation
Decision Framework
- Standard sequence: Deck → PPM → DDQ → Track record detail → Legal docs → Side letters
- Acceleration triggers: Repeat LP, expressed urgency, competitive situation, oversubscribed fund
- Deceleration triggers: First-time LP, skeptical interest, low urgency, early fundraising stage
- Exception handling: Regulated LPs get early compliance docs; sophisticated LPs can skip deck and start with PPM
Common Misconceptions
"Share everything immediately = transparency" → Overwhelming LPs with detail before interest established reduces conversion. "Withholding info = hiding problems" → Sequencing sensitive info until trust built is standard practice, not deception. "One sequence fits all LPs" → Sophistication, urgency, and regulation levels require adjusted sequencing.
Key Takeaways
- Materials sequencing (deck → PPM → DDQ → track record → legal docs → side letters) balances transparency with information control
- Sequence should match LP sophistication, interest level, and decision stage—not one-size-fits-all
- Delay sensitive details (proprietary positions, attribution) until trust established through positive meetings and diligence