Sudhir Variyar Writes: Global Institutional LPs Back Platforms That Can Deliver

I am often asked what should domestic general partners (GPs) do to attract global institutional limited partners (LPs). As I look back, no simple cookie-cutter formula comes to mind. Every manager’s context is different, so the approach to building an LP base will differ.

Global LP interactions in the past were primarily centred around the ‘India macro story’. While there was a brief period of euphoria for Indian private equity (PE) during 2005–07, where just turning up could get you an allocation. However, for most of the middle of last decade (~2015) Indian GPs were a sideshow in Asia, often speaking to empty rooms at conferences.

The India Story

However, things have changed post-2020. India now has the size and stability of the economy, the robust and diverse private corporate sector, the dynamic start-up ecosystem and the track record of exits by various domestic and global PE investors making it well-understood. For global institutional LPs, arguably, India is the most important market in Asia.

It is evident that barring any significant upheaval, the industry will attract substantial capital inflows. Even amid global uncertainties and market fluctuations, India’s private equity and venture capital landscape continued to demonstrate resilience in 2024, drawing in $56bn in investments, a modest but meaningful 5% uptick over the previous year.

Alongside, the GP industry has also grown and matured. Global LPs have different options to get India exposure. The choice is between the large global funds, the regional and pan-Asian funds, and the domestic managers; the choice is between stage—venture capital and PE; the choice is between a fund doing a specific sector or a more generalist fund. And, of course, the perennial question is whether to do PE at all or get India exposure through investing in mid-cap public markets.

Therefore, the conversations are more nuanced and largely about the manager’s differentiated ability to take advantage of the growth. LPs no longer invest on narrative alone. They look beyond returns to understand the GPs' capabilities. It is no longer just the ‘story’; the data needs to align.

Ear to the Ground

The positive for domestic GPs is that over time, we have also seen global LPs become more appreciative of the inherent advantages that seasoned domestic funds bring to the table. For us, it’s been the combination of a well-tested playbook and the ability to make decisions quickly. Being on the ground allows us to move with speed and agility, something that often makes a difference in competitive situations.

Promoter-led businesses continue to define a large part of India’s entrepreneurial landscape. Over the years, we’ve found that some of the most compelling opportunities for private capital have emerged from moments of transition, whether succession planning, resolving ownership misalignments or the shift to professional management. As domestic GPs, we can engage with these situations with a deeper appreciation of the local context. It’s helped us build trust early, especially in the initial stages of institutionalisation of corporates.

We have often found ourselves as the first institutional partner to several businesses that went on to become category leaders. What’s helped us stay consistent is our approach to portfolio construction. We’ve built what we believe is an India-appropriate mix across growth and buyout strategies. That balance has allowed us to stay flexible and true to our core: focusing on delivering high-quality outcomes while maintaining a strong performance track record across all strategies.

While we bring local advantage, we need to operate at the highest global standards across governance, investment discipline, operational processes, performance measurement and communication. In the early years of engagement, we realised quickly that diligence wasn’t limited to portfolio outcomes.

Every step of our decision-making process was put under the microscope, with an emphasis on how rigorously we documented and executed our frameworks. It pushed us to strengthen and institutionalise how we worked. Governance, especially, had to go beyond mere tokenism. And I believe LPs don’t just look at processes and governance in isolation, they also value the underlying culture that drives a firm.

Building Institutions

Building a culture centred on creating institutions alongside entrepreneurs rather than simply executing ‘transactions’, has long-term benefits. This partnership approach often resonates more deeply with entrepreneurs who are looking for patient, committed capital. At the same time, it becomes a strong foundation for attracting and retaining high-calibre talent.

A culture focused on institution-building creates space for professionals to engage meaningfully over the long term. For GPs looking to engage seriously with global LPs, demonstrating that this mindset is embedded across the firm, not just at the leadership level, can make a difference.

Meaningful engagement is essential for LPs to fully understand a platform's depth and maturity. It’s not just about meetings or reporting cycles; it’s about giving LPs the opportunity to see the firm in action. Whether that’s through participation across strategies or co-investment in large, complex deals, these interactions allow LPs to observe how we operate, make decisions and partner through an investment's life cycle. These touchpoints build familiarity and trust, both of which are critical for long-term alignment.

Equally important is maintaining a clear strategic focus, knowing where we want to play and where we consciously choose to stay out. That clarity doesn’t come once and stay fixed; it requires regular reflection and recalibration.

Replicating a high-quality strategy is just as important as crafting one in the first place. LPs value performance, yes, but what builds enduring relationships is repeatability, the confidence that a GP will behave consistently across cycles, markets and team changes.

India's story is strong, no doubt. But global institutional LPs don’t just chase stories; they back platforms that can deliver. Our job as GPs is to ensure we are that platform. That’s the real edge.

(The writer is MD and deputy CEO of Multiples Alternate Asset Management)