Had an interesting convo today with a former GP about the “LP virality coefficient.”
At one fund they measured how many new LPs each existing LP brings via intros, and it came out to ~1.1.
Not huge, but already close to self-sustaining. And if you could push that toward 2, fundraising starts to feel less like a grind and more like a compounding system.
But it’s def not universal.
It works much better with HNWIs, operators, angels, smaller FOs - people who are socially active and comfortable making intros. It breaks down pretty quickly with institutions like endowments or pensions, where behavior is constrained and referrals are rare.
So it’s a pretty good lens for emerging managers (where LP base is more network-driven), but less useful for bigger / institutional funds.
There’s also a timing - like most of the value comes from asking at the right moment (right after a strong interaction or signal), and then following up deliberately. And it’s less about one ask, more about building it into the process.
Feels like many funds still run fundraising as a linear funnel, while a few are quietly turning it into a network loop.