Most sponsors lead capital raises with yield projections and return assumptions. They pitch numbers before addressing the question sophisticated allocators actually care about: how is my capital protected? Liam J. Jones, General Partner at Loanify Capital and Head of Capital Strategy and Investor Acquisition, has raised and managed multi-million dollar allocations across accredited investors, family offices, and institutional allocators. His single focus is capital preservation through fixed-yield private credit strategies, and he has learned that raising capital successfully requires leading with risk mitigation, not return promises.
“One of the biggest mistakes sponsors make is leading with yield instead of risk,” Jones explains. “In today’s market, sophisticated investors aren’t just asking how much. They’re asking ‘how is my capital protected.'”
Lead With Risk Governance, Not Yield Promises
Allocators have seen enough pitch decks promising attractive returns. What differentiates successful capital raises is demonstrating how risk is governed before profit is discussed. This means showing allocators exactly how underwriting models work, how risk controls function, and how capital waterfalls prioritize principal return. “When investors understand how risk is governed, yield becomes a byproduct of trust,” says Jones. “They don’t need to be convinced that the returns are attractive. They need to see that their downside is protected.” This shortens funding cycles because due diligence focuses on validating existing controls rather than negotiating new protections. It also attracts higher-quality allocators who prioritize preservation over speculation, creating a more stable capital base that does not exit at the first sign of market volatility.
Segment Investor Communications by Audience
Raising capital for fixed-yield credit is not a one-size-fits-all approach. Family offices think differently from institutions. Accredited investors have different time horizons and due diligence priorities. Treating all allocators the same creates friction because the information they need to make decisions varies significantly. “Tailor your capital story to the allocator’s lens, and you’ll significantly shorten your funding cycle,” Jones explains. “When you speak to what matters most to each investor type, due diligence becomes validation rather than discovery.”
Segmented communication reduces the back-and-forth that extends capital raises. Institutions receive quantitative analysis upfront rather than requesting it multiple rounds into diligence. Family offices get transparency on underlying collateral without needing to ask for supplemental materials. This efficiency allows sponsors to move multiple allocator types through the pipeline simultaneously rather than sequencing conversations.
Build Process That Creates Confidence
Raising capital is not just about the pitch. It is about the process. Investors want to see a disciplined structure for how capital is taken in, deployed, monitored, and reported. Without a visible process, allocators question whether the sponsor can execute on the strategy being presented. “Investors want to see that you have systems, not just ambitions,” says Jones. “When they can see how decisions get made, how performance gets tracked, and how issues get escalated, they feel comfortable committing capital because they understand what happens after the wire transfers.”
Process-driven capital raises also improve allocator retention. When investors see consistent execution that matches what was promised during fundraising, they re-up for subsequent vehicles or increase allocations over time. This creates compounding fundraising efficiency because existing relationships become the foundation for future raises rather than starting from zero each time.
Trust Raises Capital
If you are raising capital in today’s environment, it is not enough to just have a strong yield. Returns need to be backed by strong governance, clear communication, and a structure that investors can trust. Transparency builds that trust, and trust raises capital. “At Loanify Capital, we believe transparency builds trust and trust raises capital,” Jones concludes. “Lead with how capital is protected, speak to what each allocator type needs to hear, and build a process that creates confidence. That’s how you raise capital that stays committed for the long term.”
Connect with Liam J. Jones on LinkedIn for insights on raising capital for fixed-yield private credit vehicles.
