How to Choose a Placement Agent

Essential Selection Criteria

Choosing the right placement agent can significantly impact your fundraising success. Here are the key factors to evaluate:

Proven Track Record

Look for agents with demonstrable success raising capital for funds similar to yours in strategy, size, and vintage. Ask for specific examples and references from recent mandates.

LP Network Depth

Evaluate the quality and relevance of their LP relationships. Top agents maintain active relationships with 500-1,000+ institutional investors, but depth matters more than breadth for your specific strategy.

Strategy Expertise

Ensure the agent has genuine expertise in your fund's strategy (buyout, growth, venture, credit, real estate, etc.). Specialist knowledge enables more credible LP conversations.

Geographic Coverage

Confirm their ability to access LPs in your target markets. Leading agents have teams across North America, Europe, and Asia-Pacific with local market knowledge.

Team Quality & Continuity

Understand who will actually work on your mandate. Senior relationships matter, but day-to-day execution is often handled by more junior team members. Assess the full team.

Pro Tip: Request a detailed LP target list as part of the pitch process. This reveals both the agent's understanding of your strategy and the actual depth of their relevant relationships.

Red Flags to Watch For

Be cautious of placement agents who exhibit these warning signs:

Overpromising on Timeline

Agents promising unrealistically fast closes or guaranteed commitments may be overselling. Quality fundraises take time, typically 12-18 months.

Vague LP Relationships

Inability to provide specific examples of LP relationships or recent closes in your strategy is a warning sign. Real relationships can be evidenced.

Excessive Mandate Volume

Agents handling too many simultaneous mandates may not provide adequate attention. Ask about current workload and capacity.

Lack of Regulatory Compliance

Ensure the agent is properly registered (SEC, FCA, etc.) and follows industry best practices. Non-compliance creates significant risk.

Questions to Ask

During your selection process, ensure you get clear answers to these key questions:

Track Record & Experience

How many funds similar to ours have you raised in the past 3 years?
What was the average time to close for those mandates?
Can you provide references from recent GP clients?

LP Network & Coverage

Which LPs do you have genuine relationships with that are relevant to our strategy?
What percentage of your target list represents warm vs. cold outreach?
Which LPs have you placed capital with in our strategy in the past year?

Team & Process

Who specifically will work on our mandate and what is their experience?
How many active mandates does this team currently handle?
What is your typical approach to roadshow planning and LP engagement?

Making Your Decision

The best placement agent for your fund is rarely the biggest or most prestigious. Focus on finding an agent with genuine expertise in your strategy, relevant LP relationships, and a team that will prioritize your mandate. Chemistry and communication style matter—you'll be working closely together for 12-18 months or more.