Evaluating the manager is the work

InvestNow · Investor Protection · Updated for 2026

First, the boundary. InvestNow does not evaluate, recommend, endorse, or approve any sponsor, manager, or offering, and appearing on this platform is not a vetting outcome. The diligence is yours. What we can do is hand you the questions a professional allocator would ask, and tell you what a weak answer sounds like.

Why dispersion changes the job

Category returns are close to useless as a forecast of your result, because the range around them is enormous. Two funds raised in the same year, buying the same kind of asset, routinely finish a decade apart in outcome. The implication is uncomfortable and clarifying: picking the asset class is the easy part, and picking who runs your money is the whole decision. Why private markets covers the structural case; this page covers who you hand it to.

1. Track record — and how to read one

• Ask for returns by vintage year, gross and net, for every fund the firm has raised — not a selected composite.
• Ask what is realised and what is still carried at a manager-determined mark. An unrealised return is an opinion.
• Ask which individuals produced the record, and whether those individuals are still there.
• Ask about the losses. A manager who cannot describe a deal that failed and what changed afterwards is either inexperienced or not being candid.

2. Strategy discipline

Does the current fund do what the record was earned doing? Style drift — a small-buyout team raising a fund four times larger, a real-estate group moving into credit — means the track record you were shown was produced by a different activity. Ask why the strategy changed and who on the team has done the new one before.

3. Fees, in full

• Management fee: on committed or invested capital, and for how many years?
• Carried interest: what hurdle, hard or soft, and is there a clawback that actually functions?
• What else is charged to the fund — transaction, monitoring, administration, placement?
• Every intermediate layer between your dollar and the asset. Run it through the fee-drag estimator.

4. Reporting and transparency

• How often are statements issued, and are financials audited by a recognised firm?
• How are unrealised positions valued, by whom, and is any part of it independent?
• Will you receive position-level detail, or only fund-level totals?
• When are tax documents historically delivered? Late K-1s are a persistent, avoidable irritation — see the tax paper trail.

5. Alignment and structure

• How much of their own money is in this fund, and is it cash or a fee waiver?
• Who is the administrator, the auditor, and the custodian — and are they independent of the manager?
• What are the key-person provisions if the person you are backing leaves?
• What are the conflicts: affiliated service providers, cross-fund transactions, co-investment allocation policy?

6. Terms you will live inside

Fund life and extensions, recycling provisions, the LP advisory committee’s actual powers, transfer restrictions if you need out, and what a default on a capital call costs you. Fund structures explains how these differ by wrapper.

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