Working With Placement Agents: What IR and Finance Teams Need to Prepare for a Managed Fundraise

When a fund manager engages a placement agent, the deal team focuses on refining the investment thesis and meeting prospective LPs. Behind the scenes, investor relations and finance teams face a compressed timeline to produce investor-grade documentation, populate a virtual data room, and coordinate with external service providers, all while maintaining normal workflows.

What Does the Placement Agent Need?

Placement agents request comprehensive materials before launching investor outreach. While some items come from legal counsel or the investment team, IR typically coordinates the DDQ and data room while finance owns track record data and capital account details.

Common requests include:

• Historical performance calculations with supporting documentation

• Current portfolio valuations and methodology

• Detailed capital activity records across prior funds

• Audited financial statements and management letters

• Completed due diligence questionnaires (DDQs)

The DDQ alone often runs 100+ pages and can take 4-8 weeks to prepare properly, a timeline that catches many teams off guard.

How Should Track Record Data Be Organized?

LPs and placement agents expect track record information in formats that allow quick comparison across managers, returns at both fund and individual investment levels, with clear documentation of valuation methodology.

For closed-end funds, finance teams commonly prepare gross and net IRR, TVPI, and DPI metrics with vintage year breakdowns. The placement agent will stress-test these numbers, so having underlying calculations readily available, not just summary figures, helps avoid delays.

Reconciling track record data that predates current systems deserves particular attention. If the fund changed administrators mid-life, ensuring continuity in the numbers requires additional coordination.

What Data Room Standards Do LPs Expect?

A well-organized virtual data room signals operational maturity. Placement agents advise on structure, but IR bears responsibility for populating and maintaining the repository. LPs generally expect:

• Clearly labeled folders with consistent naming conventions

• Searchable PDFs rather than locked or image-based files

• Version control preventing outdated documents from circulating

• Access controls with clear audit trails

Security restrictions that prevent LPs from extracting data, while well-intentioned, can create friction. If an analyst cannot copy figures into an investment memo, diligence slows considerably.

When Should Service Providers Be Looped In?

Fund administrators, auditors, and legal counsel each contribute to fundraising materials. Engaging them early prevents bottlenecks.

Administrators prepare performance reports, investor schedules, and capital account statements that feed into the DDQ. If administration recently changed hands, reconciling legacy records may require extra time. Auditors may need to provide consent letters for marketing materials, confirming availability and fees beforehand avoids surprises.

The ILPA DDQ template includes substantial sections on fund administration, cybersecurity, and compliance. Having the administrator review relevant responses before the data room opens is standard practice.

What Operational Questions Do LPs Prioritize?

LP due diligence has expanded significantly beyond investment returns. Institutional investors increasingly focus on organizational stability and succession planning, valuation policies and third-party verification, cybersecurity protocols, ESG policies, and diversity metrics.

IR and finance contribute to many of these sections. Having current policies documented, rather than formalizing informal practices during a live fundraise, reduces stress and improves response quality.

The placement agent may lead investor outreach, but the documentation that builds LP confidence originates internally. Starting early, coordinating with service providers, and maintaining high data quality positions the fund to close efficiently once meetings begin.