New role for Bacon
One of HarbourVest Partners‘ longest-standing investors is standing down. Kathleen Bacon (pictured), who has been at the firm for 25 years and was most recently head of European and emerging market fund investments, has moved into a senior advisory role. Carolina Espinal, an MD who’s been at the firm since 2004, has taken over as head of European primary partnerships.
Hamilton Lane exec departs
Speaking of departures, Tarang ‘Taz’ Katira, a star principal at Hamilton Lane, has resigned ahead of an assault charge, the WSJ reported on Friday (paywall). A spokesman for London’s Isleworth Crown Court confirmed to PEI that Katira appeared on Wednesday and pleaded guilty to assault by beating. He will be sentenced in late August. We don’t have further details but this will come as a shock. Katira was well-regarded in the industry and was nominated by several market sources for our Future 40 Leaders of Private Equity list this year (he was not ultimately included).
The hurdle rate conundrum
Only the top 5 percent of US buyout managers comfortably exceeded their hurdle rate in the last two decades, according to research from eFront which analysed the pooled average IRR of US buyout and venture GPs from 1991-2012. Overall, more than 60 percent of buyout funds managed to beat the 8 percent threshold, while only 38 percent of VC funds had done so. As macroeconomic and business conditions play a role in a fund’s performance, a one-size-fits-all hurdle rate based on IRR needs a serious rethink, the report argues.
Carlyle debt fund co-investment. Carlyle closed on a combined $5.3 billion last week for its latest infrastructure and credit offerings. The $3.1 billion Carlyle Credit Opportunities Fund – its first opportunistic credit vehicle – has already deployed $1.3 billion into 10 transactions, around $450 million of which came from LP co-investments and other investors. Co-investment has been growing in the credit world, with investors such as Pennsylvania Public School Employees’ Retirement System implementing programmes.
LP meetings. It’s Monday, so here are some LP meetings to watch out for this week.
- 16 July – Louisiana School Employees’ Retirement System is holding an investment committee meeting; San Bernardino County Employees’ Retirement Association is holding an investment committee meeting; Virginia Retirement System is holding a board meeting; Maryland State Retirement and Pension System is holding a board meeting
- 17 July – Oklahoma Police Pension and Retirement System is holding a board meeting; Chicago Policemen’s Annuity & Benefits Fund is holding a board meeting; Tulare County Employees Retirement Association is holding an investment committee meeting
- 18 July – District of Columbia Retirement Board is holding a board meeting
- 19 July – School Employees Retirement System of Ohio is holding a board meeting; New Hampshire Retirement System is holding an investment committee meeting
Ever wanted to know if your PE portfolio is really outperforming public benchmarks? Tune in to data provider Burgiss’s webinar, “LP Best Practices: New strategies in benchmarking PE/VC returns” on 25 July. Speakers from Oxford University, Goldman Sachs, Landmark Partners and more will discuss the use of credit lines and why big LPs such as CalPERS are moving towards new benchmarking models.
New York double hitter. New York State Common Retirement Fund has approved more than $1.2 billion in private equity commitments, including to TA XIII, Providence Strategic Growth IV and The Seventh Cinven Fund. Here’s a breakdown of the $210.2 billion US pension fund’s total investment portfolio. For more information on NYSCRF, as well as more than 6,700 other institutions, check out the PEI database.
They said it
“If private markets had their own telenovela, it would most likely be called ‘aligning the interests of fund managers and investors’.”
eFront’s latest report on hurdle rates lays out the complex, multi-generational issue of alignment of interest.
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Today’s letter was prepared by Isobel Markham, Adam Le, Rod James, Carmela Mendoza and George Glover.
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