Happy Thursday and welcome to another edition of Beyond TVPI.

This week’s newsletter looks at a question every LP eventually asks: what actually makes an LP attractive to the best GPs? After a decade on the LP side, my answer ended up being quite different from what I expected.

In Founders Corner, I revisit another assumption: that the newest AI model is what matters most. Our experience continues to suggest the opposite. The biggest gains come from better workflows, context, and execution - not simply a better model.

If you have questions or comments I’d love to hear them! Just hit the reply button.

Enjoy the read,

Steffen

Every LP asks some version of the same question:

“How do we get access to the best managers?”

The answers usually revolve around brand, ticket size, speed, or relationships.

Those matter.

But after spending a decade on the LP side and speaking with hundreds of GPs, I came to think two factors consistently mattered more than almost anything else.

Neither requires a famous name.

The first question many GPs ask themselves is surprisingly simple:

“Can I reasonably expect this capital to be there in future funds?”

Different LP types naturally score differently here.

At one end are institutions such as pension funds, foundations, endowments and many family offices. Their underlying capital is generally long-term, and if the relationship works, there is a reasonable expectation they may become repeat investors.

At the other end are investors that effectively have to raise capital themselves. Fund of funds are the obvious example. Even if they love a GP, they still need to convince their own investors to commit to the next vehicle.

That doesn’t make fund of funds unattractive. Many are exceptional partners.

It simply introduces another layer of uncertainty.

From a GP’s perspective, a relationship that has a high probability of extending over multiple vintages is naturally more valuable than one that may disappear for reasons entirely unrelated to the GP’s performance.

This is the factor I think many LPs underestimate.

GPs do not expect every investment committee to approve every opportunity.

They do not expect every timeline to go exactly as planned.

What they value is something much simpler:

Can they trust your process?

Can you explain how decisions are made?

Can you communicate realistic timelines?

Can you avoid disappearing for two months before resurfacing with a last-minute request?

A predictable “no” is often better than an unpredictable “maybe.”

Because a GP can replace a “no.” They can’t plan around uncertainty.

Fundraising is a resource allocation exercise. GPs decide where to spend partner time, who receives updates, who gets access to oversubscribed funds, and who they continue investing in as relationships.

The same is true - perhaps even more so - for placement agents. Their credibility depends on introducing LPs who are serious, transparent, and capable of executing. If they know your process is reliable and that you communicate honestly, they are far more likely to bring you into competitive fundraises. If they don’t trust your process, they are unlikely to spend one of their limited introductions on you, regardless of how attractive your capital may be.

If an LP consistently communicates where they are in the process, what remains to be done, and when the GP should expect the next update, the GP can actually plan around it.

That creates trust.

This was one of the biggest surprises of my own career.

I spent the first half of it at a pension fund. Like many GPs, I viewed pension funds as among the most attractive LPs because of their stable, long-term capital.

When I later joined a newly established fund of funds, one of my biggest concerns was whether we would still be able to access the highest-quality managers. On paper, we were clearly less attractive. Our own capital depended on raising capital from investors, introducing an additional layer of uncertainty that simply doesn’t exist for most pension funds.

I was pleasantly surprised.

Many of the very managers I had expected to be difficult to access were perfectly willing to engage with us. The reason became clear over time.

They knew how we worked. They understood our diligence process. They trusted our timelines.

By contrast, institutions with exceptionally stable capital can become surprisingly difficult counterparties if their internal processes were opaque or constantly changing. A GP cannot confidently factor re-ups into long-term planning if every re-up conversation feels like starting from scratch or the LP is not responding.

The fund-of-fund experience changed my perspective.

All else equal, stable capital is an advantage. A pension fund with an equally good process will generally be the preferred LP.

But if I had to rank the two, process comes first.

History simply reinforces it.

A GP can work with capital that is somewhat less predictable.

It is much harder to work with an unpredictable process.

We believe great software shouldn’t replace an investment process - it should reinforce it. It should make collaboration easier, keep teams aligned, and reduce dependency on individuals.

That’s the philosophy behind FundFrame.

A few weeks ago, I wrote that I no longer get particularly excited about new AI model releases.

Since then, we’ve tested Fable 5, lived without it and are now using it again.

It is better.

But it also reinforced something we’ve increasingly seen at FundFrame: for most real-world work, the workflow matters far more than the model.

In private markets, even a flagship AI model still can’t reliably look at a waterfall and tell you whether it’s European or American. Give it the right training, examples, and context, however, and it suddenly can. The interesting part is that this was already true for many previous models.

I’d rather have yesterday’s model with great context and proper training than the newest model without either.

I’m incredibly excited about what AI can do in three years, and I firmly believe in compounding gains. But I’m not particularly excited about what it can do next month.

This newsletter is written by Steffen Risager, the founder of FundFrame, a platform for LPs to manage their private markets investments.

Before that, Steffen was CIO at Advantage Investment Partners, a Danish Fund-of-Funds.

Steffen has a decade of experience as an LP, and has made commitments totalling approx. $6bn across fund- and co-investments.