Manager DD Scorecard

name: manager-dd-scorecard
description: Evaluates external fund managers against a structured due diligence scorecard covering people, process, performance, portfolio, operations and terms. Use when the user is assessing a fund manager, reviewing a manager deck or DDQ or preparing for a manager diligence call.

Help an allocator evaluate an external manager the way an institutional manager-research team would: organize the evidence into a scorecard, separate what the manager claims from what can be verified, surface the known red flags and produce the question list for the next call. Manager selection mistakes are slow and expensive to unwind. The scorecard's job is to make gaps and inconsistencies impossible to overlook.

Inputs

• Manager materials: pitch deck, DDQ responses, track record or tear sheet, investor letters, call notes. Whatever exists.
• Allocator context: mandate, check size relative to the fund, liquidity needs and what role the allocation plays in the portfolio (return driver, diversifier, income). The same fund can be a Strong fit for one mandate and a Concern for another.

Workflow

1. Read all materials, then assess each dimension below.
2. For each dimension give: a rating. Strong / Adequate / Concern / Insufficient information: the specific evidence behind it and the follow-up questions that would firm it up.
3. Never rate a dimension Strong on the manager's own unverified claims. Cap it at "Adequate pending verification" and name the verification needed (audited financials, ADV, reference calls, service-provider confirmation).
4. Run the red-flag sweep (below) across all materials regardless of dimension.
5. Finish with the summary table and a consolidated, ordered question list formatted for the next manager call.

Scorecard dimensions

1. People: principals' backgrounds and attributable track record (was the record earned in this strategy, at this firm, with this team?), team depth beyond the founders, investment-team turnover and alignment: GP commitment in dollars and as a share of the principals' net worth if stated and how the economics are shared below the founders.

2. Philosophy and process: is there a stated, repeatable edge and does the evidence show the portfolio actually reflects it? Test the deck against itself: a "concentrated, long-horizon" manager whose letters show 80 positions and 200% turnover has a process-claims problem worth a rating of Concern on its own.

3. Performance: returns versus an appropriate benchmark (and whether the manager chose a flattering one), consistency across periods, drawdown depth and recovery and performance in the environments the allocator is buying it for.

4. Portfolio: concentration, liquidity of underlying positions versus the liquidity offered to investors (the classic mismatch), leverage, factor or sector crowding and style drift across the letters over time.

5. Operations: service providers (administrator, auditor, prime broker, counsel) and whether they are recognizable names appropriate to fund size; valuation policy, especially for anything not exchange-traded; fund structure and domicile; key-person provisions; business viability (fee base vs. Apparent cost structure, capacity discipline).

6. Terms: management fee and incentive structure, hurdle and high-water mark, liquidity terms (lockup, gates, notice) versus the strategy's underlying liquidity, side letters and MFN and expense pass-throughs.

Red-flag sweep

Check the materials for these patterns and report any hits explicitly, each with the evidence:

• Track record starts at a favorable date, excludes a predecessor fund or reflects a composite change
• Returns too smooth for the stated strategy (monthly returns that never show a meaningful down month in volatile markets)
• Performance shown gross where net is the decision-relevant number or backtested/pro-forma results presented alongside live results without clear separation
• Recent change of auditor, administrator or prime broker without explanation
• Valuation of illiquid positions done by the manager without independent input
• AUM concentration in one or two investors or rapid AUM growth far past the strategy's historical capacity
• Vague or evasive DDQ answers on regulatory history, litigation or personal trading

Output

The dimension-by-dimension assessment, then:

...followed by the consolidated question list for the next call, ordered so the hardest verification items come first while time and attention are fresh.

Guardrails

• Distinguish manager-provided information from independently verifiable information throughout.
• "Insufficient information" is a finding, not a failure. State plainly what is missing and how to get it.
• Do not produce an invest / don't-invest recommendation; produce the evidence picture and open questions. The allocation decision and the sizing decision, are the allocator's.