Why Emerging Managers Need Institutional Infrastructure Before Institutional Capital
Credibility is a rapid-fire filter that determines whether your performance data is even eligible for review.
Nov 3, 2025, 12:00 AM
Written by:
Niko Ludwig
Table of Contents
Key Takeaways:
Operational infrastructure is a prerequisite, not a luxury. Institutional allocators dedicate 40% of due diligence questions to operations, governance, and reporting. Infrastructure barriers account for 41% of pass decisions despite strong performance.
Professional presentation accelerates fundraising by 30-40%. Managers with institutional-quality materials close commitments faster, generate referrals more easily, and create halo effects that reduce scrutiny during due diligence.
The investment pays for itself immediately. A single $25 million institutional commitment generates $500,000 in annual management fees, making $30,000-$75,000 in professionalization costs negligible compared to the capital unlocked.
Infrastructure must cover five pillars. Successful institutionalization requires operational infrastructure, governance and compliance, investor reporting, investor relations protocols, and professional brand standards across all materials.
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