1. Track Record: Past Performance and Execution Discipline
Past performance isn’t a guarantee of future results, but it is an indicator of how a manager executes. The first place to look is the manager’s verifiable track record. Ask: Have they executed on this strategy before? Have they done what they say they’ll do? Strong managers will demonstrate audited, verifiable performance, not just stories or selective highlights.
What matters most is not how high the returns were, but how those returns were achieved. A lack of verified results could be a red flag. So is a short or inconsistent history. Execution consistency matters more than a one-year spike. A firm that consistently performs across market cycles demonstrates control and operational discipline.
Generating great performance for one year is nice. But as an investor, you want consistent performance every year you’re invested.
2. Purpose, Mission & Values: Why the Firm Exists
Purpose-driven organizations appear to attract some of the most talented people, suggesting that this focus offers more than just meaning—but a competitive advantage. Some might find it strange to ask other managers about their purpose and values, but it’s this exact conversation that reveals how they lead and make decisions when things get hard.
Ask: Why does this firm exist? What’s its purpose? Is it clear, inspiring, and lived out in daily decision-making?
Core values show how a company behaves when things don’t go as planned. Do they communicate openly and act decisively, or close off communication when challenges arise? Purpose and values are more than talking points; they provide a window into how a firm will act under pressure. Extraordinary organizations act with transparency and conviction, even during difficult times.
3. Leadership Depth: Beyond the Founder
A common mistake is to evaluate only the face of the firm. Don’t just evaluate the CEO. In reality, the most important question is: Who’s in the room when real decisions get made? Extraordinary organizations have leadership depth—experienced, accountable people across the organization who can execute with confidence and clarity.
“Everything rises and falls on leadership, but who’s executing on that vision every day?” - John C. Maxwell.
When DLP Capital evaluates a potential partner, the team doesn’t just meet one person. “I fly out and meet their teams. I see what they’ve built and developed. I want to know who their leaders are, how long they’ve been there, and what they’re responsible for,” says DLP Capital founder and CEO Don Wenner.
That same diligence applies when you evaluate your fund manager. Ask to understand the executive structure, tenure, succession plans, and roles of key leaders. Do they have the experience to manage through different market cycles? Are responsibilities clear? The depth of leadership across an organization is a key indicator of its ability to sustain performance.
4. Execution System: Process, Not Instinct
Extraordinary organizations don’t rely on instinct; they run on a defined process and systems. Discipline is the edge. Clear communication rhythms, defined decision frameworks, and consistent accountability create the conditions for excellence. If a firm can’t explain how it makes decisions, sets priorities, or solves problems, that’s a warning sign.
Ask: How do you make decisions? What’s your meeting rhythm? How do you solve problems?
Approach execution like a 20-mile march—steady, consistent progress every day, no matter the market conditions. That rhythm of disciplined action, repeated over time, is what separates firms that perform once from those that perform for decades.
5. Communication & Transparency: How They Communicate Reflects How They Operate
How a firm communicates with investors mirrors how it communicates internally. Clarity, consistency, and transparency are signs of operational control. If they can’t give you clear reporting, their team may not have it.
Ask: Do they hold regular webinars? Provide audited financials? Deliver consistent, understandable reporting?
Frequent updates, open Q&A sessions, and direct access to leadership demonstrate genuine control and confidence. For example, it’s common to hear firms say they plan to improve investor communications—launch webinars, share quarterly updates, or provide clearer reports—but they often fail to follow through. That kind of gap between intention and execution is telling. Extraordinary organizations don’t just talk about transparency; they live it.
6. Strategy & Risk Alignment: Understanding Your Investment
Most investors focus too much on yield and too little on risk hierarchy. Understanding the strategy means understanding risk. Ask: Is there durable demand for the fund’s investments? What are the profit margins and the margin of safety? How does the capital stack work?
A great fund manager should be able to clearly articulate the margin of safety, duration, and risk controls embedded in its strategy. That strategy should have long-term demand exceeding supply, strong margins, tax efficiency, and a defined priority of distributions.
For example, many investors in multifamily syndications don’t realize they’re in the top 5% of the capital stack when most of the structure is made up of debt and preferred equity, leaving only a small portion for common equity and are the last to be paid after debt and preferred equity. That’s a huge risk you need to understand. Evaluate whether their strategy aligns with your time horizon and risk tolerance.
7. Impact Mandate: Purpose Driven Returns
Strong fund managers measure success in terms of both financial and tangible impact, without sacrificing returns. Some of the most compelling impact strategies are “non-concessionary,” meaning they generate positive outcomes and financial results.
Ask: Does the firm define and measure its impact? Do they track social, environmental, or community goals? How are those goals integrated into their strategy?
Even if impact isn’t your top priority, it is often what draws and keeps the best people in an organization—and great people drive great results.
The Real Investment: People Who Execute
Selecting a fund manager isn’t about identifying the highest projected yield. It’s about identifying the people, systems, and culture that make those results repeatable. You’re not investing in a strategy, you’re investing in people who can execute it.
Look for organizations that pair purpose with process, communication with transparency, and vision with verifiable performance. Those are the hallmarks of an extraordinary organization, and the foundation of long-term investor success. The next time you evaluate an opportunity, don’t just evaluate the projected IRR. Evaluate the people, the process, the purpose, and the proof that drives real performance.
Ready to put these principles into action? Explore how DLP’s sponsored real estate funds combine disciplined execution, mission-driven leadership, and strong historical performance.
