Affinity’s best practice guide for fundraising and investor relations

Building quality relationships with limited partners (LPs) is a necessary function for a successful venture capital firm. Once dealmakers have developed their fund investment strategy, they will spend a great deal of time and resources in identifying and engaging with potential new investors and strengthening relationships with existing investors. The goal: to raise their desired amount of funds in the shortest amount of time, while keeping LPs informed and engaged.

While this is a critical workflow, it is not without its challenges:

• Laborious processes: Identifying the right potential LPs is typically a highly laborious process of setting criteria, creating and maintaining lists of matching LPs, and coordinating lists with other team members
• Wasted time: Manually managing contact lists, outreach or engagement history, and tracking outreach success in Excel results in wasted time and leads to gaps in follow-up or engagement
• Siloed communication: As LP communication is siloed to the investor relations (IR) team or managing partners, regular communication and performance progress information can be missed, leading to reduced relationships with LPs that risk future investments
  

Dealmakers are busy. Juggling dozens of calls, meetings, and emails every day can quickly get out of hand. Finding time to update LPs on your progress can often get sidelined, but effectively managing these relationships is essential to success. And while every GP-LP relationship is different, one thing that remains constant is the need for tools that support relationship management. 

This guide will help maximize the value Affinity can bring to your fundraising and investor relations workflows by examining:

• The challenges (and how to overcome them) of fundraising and investor relations
• Best practices that have the highest impact on sustained success
• Exactly how Affinity can help you implement these best practices

4 fundraising and investor relations best practices

1. Identify a broad list of LPs 

Identify prospective LPs relevant to your fund's strategy within your network and actively expand your network to include new LPs who might invest in future rounds.

“If you can imagine the number of calls that a member of a venture investment team has in a given year, that number represents all the opportunities to find a new customer, a new partner, a new mentor, a new advisor, or maybe a new investor.”

Brian Cashin
Vice President at Teamworthy Venture

Challenges

• Segmenting and targeting LPs: LPs vary widely, with different criteria, risks, and goals, making it challenging to identify and prioritize the right ones.
• Building trust as a new manager: Many LPs prefer established VCs, and new managers or funds with limited track records can struggle to gain credibility.
• Navigating allocation preferences: LPs often have specific preferences (e.g., early-stage vs. growth-stage), which requires finding those aligned with your fund’s strategy.
• Competing in a crowded market: With many funds seeking commitments, standing out—especially against established VCs—can be challenging.
• Geographic and strategic limitations: LP mandates may restrict investments by region or industry, limiting your pool of potential LPs.
• Managing LP expectations: Diverse interests, reporting standards, and ESG requirements add complexity to LP relationships.
• Efficient resource use: LP outreach can be time-intensive, and a lack of focus risks wasting effort on low-probability prospects.

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2. Build and maintain a network of LPs

Efficiently and effectively identify prospective fund-relevant LPs in your network and maintain your network over time.

"LPs want sharp, relevant news that's of interest to them. Let them know when you’ve closed a deal, when you’ve hired someone. All of that is welcome news, whereas the same news weekly—just raising something to the top of someone’s inbox—is when it gets repetitive.”

Joe Schorge
Founder & Managing Partner, Isomer Capital

Challenges

• Regular engagement and communication: LPs expect consistent updates on fund performance, portfolio developments, and market trends. Inconsistent communication erodes trust.
• Managing diverse LP expectations: LPs vary in goals and reporting needs, making it challenging to meet everyone’s expectations.
• Balancing relationships and fundraising: Building LP relationships takes time and effort, often clashing with not only fundraising but also every other workflow.
• Adapting to shifting trends: LP preferences evolve with market changes, requiring constant adjustments to align with trends like ESG or diversity.
• Navigating regulatory requirements: Meeting strict compliance standards, especially for institutional LPs, can be complex for emerging managers.
• Handling LP turnover: Changes in LP strategies or leadership can disrupt relationships and commitments.‍
• Ensuring LP retention: Securing repeat investments requires strong fund performance, clear communication, and aligned expectations.

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3. Engage with potential investors and strengthen relationships with current ones

Strengthen LP relationships and provide insight into why your firm and fund(s) are the ideal place for their capital.

“Now that we’re done fundraising we’re shifting gears to using Affinity to communicate and track engagement with LPs. For folks that didn't invest in Fund I, but who said they were interested in Fund II, we’re trying in a very organized way to give them updates. This means staying engaged with them so that when we’re ready to go out for the next fund they’ve been getting a regular drop of information and updates from us.”

Amy Francetic
Managing General Partner, Bouyant VC

Challenges

• Accessing the right decision-makers: Many LP organizations, especially larger institutions, have layers of gatekeepers who filter potential investments before they reach the final decision-makers. 
• Crafting a personalized outreach approach: LPs have diverse preferences, priorities, and mandates. A one-size-fits-all approach to outreach is unlikely to be effective, yet customizing outreach for each potential LP can be time-consuming and resource-intensive.
• Managing timing and fundraising cycles: LPs have their own fundraising cycles and allocation timelines, which may not align with your fund’s schedule. Engaging LPs at the wrong time can result in missed opportunities or delayed commitments.
• Communicating consistently across multiple channels: LPs may prefer different methods of communication, including emails, phone calls, virtual meetings, and in-person events. 
• Sustaining engagement outside of fundraising cycles: LPs may be less responsive or engaged when there isn’t an active fundraising effort, making it difficult to keep the relationship warm. ‍
• Demonstrating consistent value beyond capital returns: LPs are increasingly looking for value beyond just financial returns. They may expect VCs to provide access to unique insights, industry expertise, co-investment opportunities, or even ESG alignment.

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4. Share data and performance with current and potential investors

Consistently provide LPs with visibility into fund and portfolio performance.

“If I need to provide an LP with information about our portfolio, my first point of reference is our Affinity tracker. [We] really depend on that information. But at the same time, you don't want to bother investment managers too much because they have a lot to do already. You don't want to constantly reach out to them and ask, ‘What about this? What about that?’ Affinity helps us achieve that balance.”

Katharina Porenta
Fundraising Manager, Speedinvest

Challenges

• Balancing transparency with confidentiality: VCs must share sufficient data and performance metrics to satisfy investors, but disclosing detailed information can expose sensitive data about portfolio companies. 
• Managing expectations around data timeliness and accuracy: Gathering and verifying information from portfolio companies can take time. In some cases, VCs may face delays in receiving the necessary data, leading to outdated or incomplete reports for LPs.
• Handling market volatility and performance fluctuations: During periods of market volatility, portfolio company valuations and performance metrics can fluctuate significantly. 
• Meeting the diverse reporting needs of different investor types: LPs have varied preferences for the type and format of data they receive. 
• Demonstrating value beyond traditional metrics: Traditional financial metrics (e.g., IRR, MOIC) may not always fully capture the value being created by the portfolio, particularly for early-stage companies focused on growth rather than profitability. 
• Aligning data sharing practices with regulatory requirements: VCs need to comply with various regulatory requirements related to investor reporting. Failure to adhere can result in legal consequences and damage to the firm’s reputation.

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Fundraising and investor relations: Affinity tips & tricks

The Affinity CRM supports fundraising by integrating how VCs track fundraises and manage LP relationships into workflows similar to those used to manage deal flow. In doing so, Affinity makes it easy to:

• Efficiently prospect for potential LPs by automating and consolidating the collection of network and activity data, and facilitating the ability to create, track, and filter selection criteria like potential investment size, industry reputation, and other metrics on potential value beyond capital.
• Use your firm’s network to drive better outreach outcomes by understanding the strength of all existing LP relationships, while at the same time maintaining the integrity of private data within the IR team and/or dealmaking team specific to that fund.
• Consistently keep in touch with and provide insightful messaging to LPs through automated reporting and CRM functionality built to drive stronger relationships.
  

“A lot of times, as you might know, when you're fundraising, LPs are looking for different things. Sometimes they're not just looking for returns. They're looking for your network. They want to understand impact, or they want to get an opportunity to co-invest with you. So keeping those things in mind is how you want to build your list.”

Jolynn Vallejo
Chief of Staff, Kapor Capital

3 ways Affinity makes fundraising and investor relations workflows more efficient

1. Engage and close funding commitments faster

Affinity’s pipeline management workflows help you track status, engagement history, and critical details throughout and beyond your fundraising efforts. Use the information to focus your time and resources on high-value investors while refining your strategy to secure additional commitments.

Use Affinity to:

• Plan and manage outreach and fundraising for every fund in one place.
• Eliminate communication barriers and avoid misalignment with investors by accessing a transparent, holistic history of your team’s interactions.
• Ensure impactful follow-ups with built-in triggers  and reminders, helping you consistently stay connected with LPs.

For example, with an Opportunity list in Affinity, you can track all of your LPs and their respective statuses across various funds over time. Be sure to complete the default Organizations and People fields for each opportunity—these fields enable other enriched data fields to auto-populate. Use the available columns (e.g., Previous Funds Invested, Prospective Funds, etc.) to monitor the funds each LP has already invested in or expressed interest in.

Once your LP engagement strategy is in place, use Affinity's bulk email and email templates features to send personalized messages to everyone on your list. 

Additionally, Affinity’s native integrations with Mailchimp and Eventbrite allow you to track engagement across platforms. Streamline LP communications by automatically syncing Mailchimp and Affinity lists, and use columns like Mailchimp Campaign Opened, Mailchimp Campaign Clicked, and Mailchimp Campaign Bounced to track recipient engagement and identify who is interested or not receiving your newsletters.

Use Eventbrite to track RSVPs, view relationship insights on attendees, and manage event follow-ups in Affinity.

2. Find the right new LPs

Affinity automatically creates CRM records for every person and company you interact with via emails or meetings, enriching these records with essential data from third-party data sources like Pitchbook, Dealroom, and Crunchbase.

This data powers Affinity’s relationship intelligence, which analyzes and scores your firm’s collective network to identify the strongest paths for warm introductions. Using Affinity’s API, you can set up automated workflows to source information on new LP engagements from marketing tools or preferred third-party sources. This reveals the structure and strength of relationships within your network, helping to uncover hidden opportunities and facilitate warm introductions.

Expand your reach by connecting your network with top external LP data sources, enhancing your ability to secure valuable referrals. Save time on manual data entry and unsuitable leads with automated contact creation and the ability to generate targeted investor lists aligned with your fund’s thesis.

You can further add to the roster of potential referrals and warm introductions with Inferred Connections, which increase the size of your firm’s collective network by pulling in data about former colleagues from previous companies and roles.

Once connected with the right LPs, Affinity’s Collaborator Seats feature allows you to securely share Affinity lists—including real-time data on people, companies, and deals—directly from the CRM. Boost the visibility of and confidence in your fund strategy by sharing:

• Deal lists with LPs
• Detailed thematic investment plans to demonstrate active fulfillment of commitments made during fundraising rounds
• Portfolio insights and performance metrics to showcase investment themes and outcomes
• Opportunity lists with key insights for co-investors and advisors

3. Retain your best investors and share performance reports

Affinity Analytics, Affinity’s reporting tool, provides insights into portfolio company and fund performance, enabling you to better visualize returns and build LP confidence in your ability to execute. Re-engage investors who passed on a previous round or expressed interest in future funds by using notes, triggers, and reminders to share relevant updates and maintain strong relationships.

Set up dashboards that show enriched Affinity Data—such as funding, firmographic, and growth metrics—combined with manually tracked information. These dashboards can be automatically shared with LPs through Affinity Analytics. Reports can include:

• Deal flow performance: Showcasing the quality and quantity of opportunities pursued.
• Progress on specific investment themes: For example, supporting underrepresented founders or emerging industries.
• Ex-portfolio company updates: Highlighting the performance of companies your firm chose not to invest in.

Affinity combines LP profiles with activity alerts, helping to ensure you maintain consistent follow-up with active investors that demonstrates your firm’s commitment to delivering value. Improve decision-making throughout the fundraising process with analytical insights into team performance, portfolio outcomes, and fund progress. Create custom investor reports and automate their distribution to keep stakeholders informed with minimal effort.

The Introductions Summary Report allows you to instantly pull data on the number of connections made to support portfolio companies, providing a clear visualization of your firm’s impact. Use this data to strengthen confidence among current and prospective LPs, showcasing your network’s ability to deliver value to both LPs and founders.

Affinity lists make it simple for your team to efficiently access, track, and add LPs to a centralized database. Analyze reports from past fundraising efforts to identify the optimal timing for launching your next fund.

Using technology to drive workflow efficiency

Investor relations professionals need tools that streamline their work, ensuring data and reporting are easily digestible. Affinity delivers on this, with data entry automation that allows you to scale your reporting functionality while keeping your entire network at your fingertips. Set, track, and manage team KPIs for your next update, set reminders for investor follow-ups, and come to your next meeting equipped with full context to deliver the best experience for all of your investors.

Affinity’s relationship intelligence, automation, and ease of use offer a smoother onboarding process, higher adoption rates, and faster time to value compared to other CRMs designed for fundraising. Investment teams using CRMs without these critical features are more likely to miss connections, lose data, execute processes slowly, and fail to provide the insights and follow-up to keep LPs engaged. These issues can lead to LPs redirecting their investments elsewhere.

Additionally, Affinity’s user-based permission settings ensure that sensitive LP and fund information is restricted to relevant team members, while still enabling the firm to leverage its full network. Maintaining this privacy is crucial for building lasting LP relationships.

Close funding rounds faster, retain your top investors, and expand your LP network with Affinity CRM. Its relationship intelligence automates the capture of critical fund data, seamlessly connecting funding, deal, and portfolio workflows. This provides the insights that drive strategy, enhance your team’s value to investors, and reduce the risk of missing fundraising targets. 

“Fundraising is easy to handle with Affinity. From the moment we first talk to a potential LP until the time they sign the subscription agreement, Affinity comes to the rescue.”

Carlo Egle
Investment Manager, Redalpine

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