The co-investing market could be experiencing too much of a good thing
As the co-investment market balloons in size and popularity, some hiccups have emerged: for one, a lack of conformity regarding fees is cause for confusion across the market; for another, there are concerns that an abundance of co-investment capital may prompt some managers to stray beyond their sweet spots. In this special report, we take a look at the issues facing this burgeoning market and how savvy co-investors can hope to avoid such pitfalls.
INSIDE THE REPORT
LPs are losing their appetite for co-investment
GPs may begin to pare back their co-investment offerings as appetites shrink among investors.
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Many LPs are struggling with overallocation to private equity, causing them to be more selective when picking which funds to commit to. In order to attract these investors to their vehicles, one of the most important incentives that GPs can offer is access to co-investment. In this special report, we examine the nuances of the strategy, including how LPs are increasingly demanding certain concessions on their no-fee investments, and how a formalised strategy can go a long way towards making you a reliable co-investor.
LP co-investors seeking continuation fund protections
With fundraising sluggish and GPs often desperate for capital, LPs are in a stronger position to demand certain concessions on their ‘no-fee’ co-investments.
Ardian on co-investment’s strong dealflow
Despite the ongoing slump in the overall PE market, co-investors are seeing more deals than ever, says Alexandre Motte, head of co-investment at Ardian.
Wisconsin’s Chris Eckerman on fundraising, co-investing in today’s market
State of Wisconsin Investment Board’s head of co-investments discusses the state of the PE market this year and how the slow fundraising environment is impacting things like term negotiations and co-investing opportunities.
Schroders: Unlocking outsized returns in the lower mid-market
The lower mid-market offers the most compelling co-investment opportunities at present, say Schroders Capital’s Jeremy Knox, Vahit Alili and David Bajada.
Meketa presents the blueprint for co-investing
Knowing exactly why you want to co-invest and formalising your strategy will go a long way towards making you a sought-after co-investor, say Steven Hartt and Ethan Samson, managing principals at Meketa Investment Group.
Pantheon on what co-investment funds bring to the table
Superior sourcing, diligence and execution capabilities are all reasons why investors should consider working with a co-investment manager, say Erik Wong and Matt Cashion, partners in Pantheon’s global co-investment team.
Pictet on taking a sustainable approach to co-investment
Partnering with GPs on environmental deals provides the perfect opportunity to generate positive contributions and outsized returns, says Nicolas Thomas, private equity investment manager at Pictet.
Co-investors under pressure from regulators
Co-investment brings benefits to both GPs and LPs, but unless tensions are resolved, there is a real risk it could be regulated out of the market
The art of co-investment selectivity
Lessons learned during the last financial crisis are helping co-investors make clearer investment decisions today
UBS: Carry on co-investing
Co-investment will continue to play a crucial role in PE despite the present macro environment, says Markus Benzler, head of multi-managers private equity at UBS Asset Management
abrdn’s Watson: Co-investment is a ‘partnership approach’
Being an active co-investor can help inform all of a firm’s operations, says Alistair Watson, head of strategy innovation, private equity, at abrdn.
Portfolio Advisors on resilience in the mid-market
The mid-market will be the most likely source of co-investment deal activity this year, say Ben Hur and Adam Clemens of Portfolio Advisors.
The rise of fundless deals
Greater flexibility in co-investment deals is proving to be attractive in an uncertain market.
Churchill on collaboration in the mid-market
Scaled co-investment platforms receive most of their opportunities at the front end of a GP’s investment process, say Churchill’s Jason Strife and Anne Philpott.
Download the March 2023 issue of Private Equity International
Inside: The price is right – the ins and outs of portfolio valuation; From regulation to collaboration – a 17-page special report on co-investing; Expert comment and analysis from industry leaders; Plus much more…
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