Ideal Deal Flow for Small to Mid-Cap Investment Funds: What Professionals Need to Know

Ideal Deal Flow for Small to Mid-Cap Investment Funds: What Professionals Need to Know

As the manager of an investment fund you rely on a steady stream of new assets, and you know that reaching out for new capital is a vital part of growing your business. You know you need the right partner in your corner, and that following up on qualified leads is an essential way to build a better business.

What you may not know is how to best measure the success of your outreach efforts and your various marketing campaigns. How do you determine which parts of your marketing is working, which ones could be working better and which ones should be scrapped altogether?

In order to answer that question it is important to look at what is considered an acceptable deal flow for the average small to mid-cap investment fund. As with so many things in the financial arena, there is no one right answer to this question, and there are a number of factors to consider when evaluating your own efforts.

The level of what would be considered a good deal flow for a small to mid-cap investment fund will vary, and in many ways the answer will depend on the tightness of the investment criteria in question. It is important to compare your own results to the results of investments in a similar category, as that will give you the most accurate and actionable information.

Those various factors should definitely be taken into account, but overall a hit ratio of between 0.5% and 1% is considered to be good. That may seem like a low hit ratio, but it is pretty standard for the industry.

The fact that a 0.5% to 1% hit ratio is considered good is best put into perspective, and a look at the raw numbers is definitely in order. Those percentages mean that for every 100 to 200 opportunities you receive you will only close a single deal. Those numbers and percentages are certainly daunting, and that is why it is so important to maintain a steady inflow of deals. If you want to maximize your resources and make the most of your marketing budget, keeping those leads coming is a vital first step in the process.

The good news is you do not have to go it alone, and partnering with a firm that uses the latest in algorithmic intelligence, along with the most experienced human capital, is a great way to maximize your inflow of deals, so you can convert those low hit ratios into a steady flow of new business. With a partner like the fastest growing deal origination platform AQCON.co in your corner, you can improve the inflow of deals to your small or mid-cap investment fund, giving you a leg up on the competition and helping you succeed in an increasingly competitive financial environment. We encourage you to learn more about how this partnership can benefit you and save you money on marketing costs, lead qualification and other vital facets of your business.