Relationships matter: why capital isn’t enough to gain access to top private equity funds

It’s easy to believe that private equity has become something of a buyers’ market in the past couple of years. The fundraising climate continues to be challenging – with global totals declining by 11% in 2025 – so there’s a widespread feeling that today, potential fund investors (or limited partners) can pick and choose which funds to allocate to. Fund managers (or general partners) with allocations to fill will, so the thinking goes, be pleased to secure capital from almost any source to get fundraising completed.

However, that’s not necessarily the case. What’s really happened is that fundraising has bifurcated. Top-tier fund managers with strong track records and trusted brand names tend to have very loyal investor bases who often provide much of the on-going capital they need. Meanwhile, the rest struggle to attract investment. How then can investors access funds managed by the best-performing players?

Laying the groundwork

The reality is that, unless they have a pre-existing relationship with a top quartile general partner (GP), they will find it very difficult. Limited partners (LPs) might have large amounts of capital to invest but money is not all that matters. GPs whose funds are in high demand will usually offer allocations first to LPs they know well (even if they have not invested with them before), and that leaves little space for newcomers to the party. Therefore, it’s vital for LPs to lay the groundwork by establishing relationships with GPs long before they plan to invest in a fund.

That’s always been our strategy at Connection Capital. We spend years developing strong relationships and building trust with leading fund managers. The decision to invest comes much later, once both we and they are confident that this will be a mutually beneficial partnership. In our view, it’s vital to take the time to get to know the principals personally and to engage with fund management teams regularly so that both parties get a good sense of what the other would be like to do business with.

This allows for a deeper, more nuanced due diligence process on both sides. GPs want to work with us because we have an strong reputation in the market but beyond that, they want to gauge for themselves whether we as an LP are likely to be supportive of their aims, what our appetite is likely to be for future allocations into subsequent funds, our ability to deliver and what else (apart from capital) we can bring to the table. We get a better feel for the people who are the driving force behind the fund strategy, understand their investment philosophy more clearly and gain insights into what their future pipeline holds.

GPs who are tempted by their success to try and raise bigger and bigger funds clearly will need to expand their pool of potential LPs, but changing investment strategy increases the risk that the track record cannot be maintained. For those who stick to their tried and tested investment methodologies, raising funds of similar sizes to previous rounds to fit the particular niche they have carved out, there’s unlikely to be much room to let new LPs in, and those that do get access will be a select few. We target the latter category on the basis that they are better placed to repeat their previous outperformance.

Money can't do all the talking

This relationship-building approach puts us in a position to be one of those select few when a good opportunity to invest arises, and to be offered the option to participate in future fundraisings going forward. Our model appeals to GPs because we offer a way for them to tap into the private wealth channel as an alternative to institutional capital: this is a fast-growing and increasingly important segment of the market that is not easy for GPs to access. And since they understand how we operate, they can be assured that we can provide a steady flow of capital from private investors and family offices, for whom private equity has become an increasingly attractive asset class.

Money can’t do all the talking: even family offices and institutional investors capable of writing very large cheques may find they don’t get a hearing without the proper preparation in place first. GPs need an efficient, reliable way to fundraise and LPs need an efficient, reliable way to invest with the best in class. With the firm foundations of a strong relationship beneath them, both stand to benefit.