Private Equity
For the past three months, I've been fighting/begging/cajoling/shaming CalPERS to provide carrying values for its investments in Apollo Management, The Carlyle Group and Silver Lake Partners. Not in funds managed by those firms, but rather in the actual management companies. CalPERS, however, has demurred -- arguing that such investments are exempt from the system's quarterly reporting requirements. Instead, they kept telling me to wait for an annual investment report, whose publication was pushed back from last month until sometime in late March or early April. Today, however, CalPERS changed its mind. The system sent over the requested info through the end of last June. Sure it's already eight months out of date, but it still gives us a better sense of what happened to private equity firm values between the middle of 2008 and the middle of 2009. To my knowledge, these numbers have not been published elsewhere.
2 min read · 22 February 2010
Law firm Weil, Gotshal & Manges has issued a client alert about how tax changes could affect private equity investors doing business in the Asia-Pacific region: Private equity investors that are considering making or disposing of an investment in the Asia-Pacific region should consider recent tax developments that may subject their profit to increased local tax. In particular, tax authorities in Australia, China, India, and South Korea have taken steps to impose tax on the disposition of private equity investments that previously would not have been subject to such local tax. The rationale for the changes varies, ranging from fears of tax avoidance to nationalistic concerns regarding profits escaping local taxation. Read the full client alert here.
1 min read · 22 February 2010
Got a question for TPG Capital chief David Bonderman? If so, the fine folks at UNC Kenan-Flagler are offering you an opportunity to ask it. The school hosts its annual alternative investments conference this Thursday, featuring keynotes from Bonderman, Mark Yusko (Morgan Creek Capital) and Mark Patterson (MatlinPatterson). peHUB readers are being asked to submit questions you would like each keynote to answer during Q&A. Email me your question, or leave it in the comment section below. We'll pick the best ones, and report back on the answers next week...
1 min read · 22 February 2010
We’ve spent lots of time here discussing pay-to-play, in the context of public pension officials and the placement agents who bribe them. But there is a percolating pay-to-play issue that we’ve only mentioned in passing: The issue of VC conference organizers who charge entrepreneurs to make elevator pitches in front of potential investors. For the record, I agree with those who criticize such arrangements. VC conference organizers should make their profits from sponsors, not from struggling startups in need of cash. And, if sponsorship doesn’t cover it, then also charge non-presenting attendees. For more on this, you can read the vitriolic comment thread on Jason Mendelson’s Vox Populi post from last week. But I’m not raising this to discuss the pay-to-play conference situation. Instead, I’m raising it to discuss something even more insidious: Venture capital “finders.” Last week, a Silicon Valley investor named Hugh Sloan III came across a startup that had received a minor award from Microsoft. He emailed the company founders, saying he had “3 ex Google angels and two Tier 1 venture funds who would be looking at this opportunity with me.” Sounds great, except there was a giant catch: Sloan wanted $7,500 up-front, in order to set up the meetings. No refunds if the investors didn’t offer term sheets.
3 min read · 22 February 2010
Bloom Energy has been developing its "power plant in a box" for the past decade, but has played very coy when it comes to specifics. Beta clients have been asked to keep quiet, and Bloom investors have done little but offer knowing smiles. Approximately $400 million in venture capital thrown into a black box (both literally and figuratively). Well, until tonight. The Sunnyvale, Calif.-based company gave a sneak peak to 60 Minutes, just two days before the formal unveiling. Pretty good PR coup, even though the piece did give some voice to Bloom's legions of skeptics. In short, Bloom promises to build boxes as small or as large as the customer needs (shoebox for a home, foot locker for a small store, multiple refrigerator-sized boxes for industrial facility). Each is filled with stacked ceramic disks, which are imprinted with a type of ink that you won't find in your ballpoint. You can view the 60 Minutes segment after the jump. My only quibble is that Leslie Stahl notes how Colin Powell has "endorsed" Bloom, without also mentioning that he's a special limited partner in Bloom investor Kleiner Perkins:
1 min read · 22 February 2010
Rafael Astruc is out at Private Advisors, the Richmond, Va.-based alternative asset management firm he co-founded thirteen years ago. Astruc's final day was last Friday, and he does not yet seem to have new employment. Private Advisors confirmed the resignation in a brief statement to peHUB, adding that the firm "is operating in its usual manner and does not anticipate any disruptions to the business." A source familiar with the situation says that Private Advisors is prohibitted -- or at least strongly discouraged against -- saying more, due to a nondisclosure agreement over the terms of
1 min read · 19 February 2010
I have not yet met new NYC Comptroller John Liu, but he already seems to be a vast improvement over his predecessor (and not just because he quoted my obscenity in an official announcement of Larry Schloss as CIO). The latest example came this morning, with Liu announcing that he will lift an existing ban on private equity placement agents doing business with the NYC pension system. There are, however, several new conditions: 1. Placement agents must be registered with the SEC and/or FINRA 2. Placement agents must describe the services provided 3. Placement agents must demonstrate that they have helped raised at least $500 million from other entities (i.e., not NYC) in two of the past three years. Moreover, those using placement agents now would be required to disclose their usage, including any associated fees. Fund managers seeking NYC business also would be required to disclose any contacts with Comptroller’s Office employees, and would be precluded from providing any gifts or campaign contributions to NYC pension officers.
2 min read · 18 February 2010
Three employees of electric car company Tesla Motors were killed today, following the crash of a small plane in East Palo Alto, California. Japolnik reports that the twin-engine Cesna was piloted by a "high-ranking official at Tesla," but did not give his or her name. The San Francisco Chronicle adds that Tesla engineer Doug Bourn is the plane's owner, but it is unclear if he was either piloting or aboard as a passenger. The crash did not cause injuries on the ground, but did lead to both residential damage and power outages.
1 min read · 17 February 2010
My weekly small biz video segment with Reuters, which discusses Steve Schwarzman's recent op-ed in the Washington Post. Specifically, I believe that the recent revival of leveraged lending pokes a hole in Schwarzman's argument that "uncertainty" has caused banks to cut back on small and mid-sized business lending. Shouldn't that same uncertainty -- which will always exist, by the way -- apply to large-market lending? I know some readers disagree with my critique, because large-market loans have a better chance of being publicly-traded. But, as Energy Future (fka TXU) recently showed, such flexibility is itself uncertain. Anyway, video after the jump...
1 min read · 17 February 2010
Fallbrook Technologies today filed for a $50 million IPO, although I can't for the life of me figure out why. The company has decreasing revenue, increasing losses and is looking to raise the type of equity infusion that its existing VC backers should be able to provide. If it weren't for Vringo, this would be in contention for the year's "WTF IPO?!?!" prize. All of that is a way of leading into our monthly look at VC-backed companies that are in registration to go public on U.S. exchanges. There are of 37 them, representing more than $4.25 billion in targeted raise. This includes 11 additions since our last list, and two removals (Ironwood Pharma and Quinstreet, which both priced). Get them all after the jump...
10 min read · 16 February 2010
