For centuries, men and women met in bars or other local establishments within their communities. Many relationships, therefore, started following a chance encounter and some liquid courage.
Then in 1995, Match.com debuted. This meant no longer having to rely on chance encounters. Now you could do some prospecting, so to speak, on a Tuesday night from the comfort of your living room.
Fast-forward to 2012, Tinder took online dating a bit further with a mobile app that prioritized—for better or for worse—instant gratification and physical attraction.
So it’s really easy to meet a new companion now. A healthy by-product of this is that there’s less of a reason to stay in an unfulfilling relationship. Think about it: how often did someone stay in a relationship only because of the daunting nature of trying to meet someone new? That proposition became far less daunting after spending 90 seconds flicking through the Tinder app, provided you don’t look like Sloth from the Goonies.
What can investment managers learn from this?
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Match.com and Tinder might indicate that most of today’s fund managers are relying too much on chance encounters when more investors are conducting due diligence online. Furthermore, when these chance encounters do happen, a lot of fund managers are still leading with blasé fact sheets or 40-page pitch decks. In a world of instant gratification, this is a horrible first date.
Yes, fact sheets still matter, just as personality and political leanings are still going to matter to the more discerning Tinder user. But most will never find this information because they have already swiped left. You failed to entice them.
Most other industries, and some thought leaders in the asset management industry, now use slick websites, intuitive apps, and, most importantly, a robust content strategy to engage and retain investors. The even savvier ones are promoting themselves on Instagram or Spotify, for example, to targeted investors so they can swipe right.
This is a critical concept because whenever an asset manager says, “my returns speak for themselves,” I know they will never raise money. Or if they do, the assets won’t be very sticky because they will have attracted performance-chasers—the serial daters of today’s online dating world. These are not the people you want to invest your time in.
If online dating has taught us anything, it’s that the barriers to meeting a new companion are now minimal and there’s no reason to stay in an unfulfilling relationship, whether romantic or financial. If investors can easily find a new companion, managers must acutely understand that their clients are more at risk than ever if they are not being fulfilled.