1 min read · 20 November 2008
The University of Michigan is the latest institutional investor to bust through their target allocation to private equity, according to new information released as part of today's monthly Regents meeting. The system's November investment report shows 14.2% exposure to private equity, compared to a 12.5% target allocation. Venture capital is also past plan, at 6.9% compared to 6 percent. Part of this is the so-called denominator effect, whereby falling public equity prices have artificially boosted the portfolio weighting of illiquid assets like private equity. But part of it also seems to be that the Michigan Regents keep committing to new funds, whereas certain other institutional investors have gone cold turkey. For example, the system today disclosed $69 million in new commitments to funds managed by
1 min read · 20 November 2008
1 min read · 20 November 2008
Cleantech may ultimately save the venture capital industry, but many investors now acknowledge three related problems that could stop such salvation in its tracks: (1) VCs have invested too many dollars into production/manufacturing companies that will require project financing; (2) Most VCs don’t really understand project financing, let alone production/manufacturing; and (3) Even if they did understand project financing, it wouldn’t matter because there is so little of it available. Some of the smart cleantech money, therefore, is beginning to go toward companies that want to sell or license their technologies to existing – and experienced – industry. An example of that came this morning, when Qteros announced that it had raised $25 million in Series B funding. Venrock led the round
2 min read · 19 November 2008
It’s that time of year, when young MBA candidates’ thoughts turn to flights of summer internships. So let’s help them out, through our 6th Annual Internship Rodeo. Today I am asking private equity firms to contact me via email if you’re looking for a summer intern from the current crop of first-year MBA candidates. All types of firms need apply — VC, LBO, I-banks, Mezzanine, Consulting, Funds-of-Funds, etc. Ditto for geography. In your emails, please include your firm name, job location and type of business (i.e., VC/LBO/etc.). You also may include any additional information you would like posted, including a contact email address for applicants. If you would prefer me to create an anonymous email account for you, just let me know. Your firm name will be kept confidential, unless you specifically request it to be disclosed (which about 50% of firms requested last year). Once compiled, the listings will be posted
2 min read · 19 November 2008
There has been an extraordinary amount of digital ink spent on Sequoia Capital’s “graveyard” deck, but it seems that the stuff is infinite. So here’s a litle bit more, in notes form: 1. Sequoia has gotten a lot of credit for “telling it like it is,” but shouldn’t it also get some blame for being behind the eight-ball? Specifically, how did Sequoia seemingly allow so many of its companies to become so bloated – particularly the young ones – that they can shed jobs with relative ease? It's one thing to kill off a non-core auto or financial services vertical, but quite another to slash within the main biz. Smart CEOs were beginning to cut burn rate quarters ago, and smart VCs were telling the
1 min read · 19 November 2008
* Damn, it was once good to be a banker. How incoming White House chief of staff Rahm Emanuel got rich. * The advantages of corporate bankruptcy are dwindling. * Everything's down on morning call: U.S. futures, European shares at mid-day, UK's FTSE, Hong Kong and Nikkei. * KKR's Scott Nuttall steps down from the board of Masonite, which keeps inching closer to bankruptcy. Seems the Canadian doormaker wasn't thrilled with his conflicting roles as equity sponsor (via KKR) and as lender (he's on the board of KKR Financial). * Dear John Thain on how we got a corporatocracy. * Joe Weisenthal notes that many banks in the UK have returned to the partnership model, in order to discourage risky behavior. Let's return to this in six months, after we learn the full extent of the damage private equity partnerships caused by investing in corporate "opportunities" earlier this year.
1 min read · 19 November 2008
Who says that venture capitalists have soured on Web 2.0 companies? Not Nathanial McNamara, who just left his H.I.G. Ventures to form Yasnap, a company that leverages Facebook Connect to help users create social media applications. McNamara isn’t talking much about the new venture yet, except to say that it plans to launch in early 2009. Its beta is currently accessible, however, and includes such user-generated apps as: Pass a green beer, kick the can and pass the hot potato.
1 min read · 18 November 2008
Former Citizens Financial chief Steve Steinour is in talks to raise a private equity fund in partnership with The Blackstone Group, with a focus on distressed banks and other financial services companies. Sources say the partnership is still in its early stages, and that both sides recognize the difficulty of raising a “multi-billion dollar” fund in the current environment. Steinour originally joined Citizens in 1992, and a decade later was put in charge of the firm’s expansion south of New England (including Pennsylvania retail banking ops bought from Mellon for $2 billion). Next came a vice chairmanship, and the CEO role in 2005, when Larry Fish kicked himself upstairs. Steinour officially left Citizens this past spring, to join Boston-based alternative asset manager CrossHarbor Capital Partners. His goal was to help the real estate-focused firm launch a private equity program, and the Blackstone talks began sometime later. It is unclear how the new fund is being branded, but a source says that Steinour himself “will remain under the CrossHarbor umbrella,” with Blackstone
2 min read · 18 November 2008
2 min read · 18 November 2008
