Side Letter: Cannes arrival, scapegoating PE, Neuberger Berman’s Nordic exposure

PEI reports from the French Riviera this week; Carl Thoma says PE should focus more on the value it creates than talking about itself; and Neuberger opens in Stockholm. Here’s today's brief, for our valued subscribers only.

Just happened

Coming to Cannes

MotorcyclistsPEI is heading to IPEM. Senior reporters Rod James and Carmela Mendoza will be there from tonight, moderating panels on the secondaries market (Wednesday, 4:30pm) and the role of funds of funds (Thursday, 11:15am). Get in touch with them at rod.j@peimedia.com and carmela.m@peimedia.com

CFOs and COOs Forum wrap

Carl ThomaThree big themes dominated last week’s CFOs and COOs Forum, one of which was private equity’s licence to operate. Keynote speaker Carl Thoma (of GTCR an Thoma Bravo fame, pictured) dealt with the topic on stage as well as in this off-stage interview. His take: PE is being caught up in a general anti-wealth movement, and is not doing itself any favours. The topic was also top of mind at the other big conference of the week. Bain Capital co-founder Steve Pagliuca told CNBC at Davos that he thinks “the industry gets a bad wrap”. Squawk Box co-anchor Joe Kernen reacted by asking why he was being “sensitive and defensive”: “You brought this up; you’re trying to counter something.”

The other big theme? The topic of opening the asset class to individuals came up time and again. It’s high on the agenda of SEC chairman Jim Clayton. State Street is preparing for it: per sister publication Private Funds CFO it has teamed up with iCapital Network to facilitate accessibility to its offering of registered funds. Not everyone is getting quite so excited just yet. How long might it take? “We’re talking decades,” Brien Smith, chief operating officer of Neuberger Berman Private Equity, told Isobel Markham in his keynote interview.

Northern exposure

Speaking of Neuberger Berman, the firm has opened an office in Stockholm, its 10th in Europe and 38th globally. The outpost – the firm’s first in the Nordics – will provide on-the-ground client support and sees Emelie Albeck, a relationship manager for the Nordics, relocate there from London.

Essentials

Climate change. BlackRock chief exec Larry Fink has been one of finance’s loudest voices on climate change. Increasingly, his firm is backing it up with money. Last week at Davos, the firm said it would commit $100 million to a fund dedicated to investments in climate change-linked infrastructure in emerging markets. Set up alongside the governments of France and Germany and a pair of charitable foundations, part of the Climate Finance Partnership’s initial $500 million will go towards absorbing potential early losses, giving other institutions the comfort to get involved. The CFP is aiming to raise upwards of $900 million.

LP meetings. It’s Monday, so here are some LP meetings to watch out for this week.

He said it

“When I started out we were a small industry and our sole focus was to help companies grow and foster. Now our industry is almost focused to talk about ourselves instead of how much our companies are growing or how many jobs we’re creating each year.”

Industry veteran Carl Thoma suggests PE firms could be ranked on value creation in a video with PEI senior editor Toby Mitchenall.


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Today’s letter was prepared by Toby MitchenallAdam LeRod James, and Carmela Mendoza.


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