Side Letter: LP musical chairs; PE’s talent tussle; GA’s credit coup

A raft of senior investors have jumped ship this year amid a greater focus on relationship management. Plus: new entrants to the private equity workforce are less concerned about compensation and General Atlantic is the latest to enter the credit fray. Here's today's brief, for our valued subscribers only.

Just happened

CalPERS’ Ruiz: PE’s latest public allocator to jump ship (Source: CalPERS)

Musical chairs
This year is proving an especially busy one for LP people moves. On Friday, the California Public Employees’ Retirement System said that Greg Ruiz, managing investment director for private equity, will leave his role in November. Since joining in 2019, Ruiz has been credited with restructuring the PE portfolio and helping to build out its investment team. He will take on a partner role at Jasper Ridge Partners, which manages $33 billion for a host of family offices, foundations and other institutions.

CalPERS, meanwhile, has appointed Anton Orlich, former head of alternative investments at Kaiser Permanente, as managing investment director for growth and innovation, a newly created position responsible for higher growth and higher risk and reward opportunities. Details here, with thanks to our colleagues at Buyouts.

Ruiz is the latest to leave an influential position at a large public allocator in recent weeks and months. On Thursday, Private Equity International broke the news that Ontario Teachers’ Pension Plan‘s global head of equities, Karen Frank, will leave in December. This followed news that Frank Amberg, head of PE at Munich Re Group’s asset management unit MEAG is leaving for a new role in the asset class at a different firm. Meanwhile, Steve Moseley, the former head of alternative investments at Alaska Permanent Fund, left his position in May to join Wafra.

As we noted back in July, staff turnover, especially at the senior level, can be a major headache for LPs. Personal connections and longstanding relationships matter in PE; losing executives with decades-long experience and intellectual capital when it comes to hunting the best opportunities can be debilitating. At a time when many investors are struggling with the volume of re-up opportunities on their desk, relationship management is likely to be a greater consideration than ever before. Competition to recruit and attract those with the requisite pedigree is unlikely to cool any time soon.

On the topic of talent…
PE is walking the walk when it comes to diversifying the talent pool it recruits from. That’s according to a report from EY and Columbia Business School, more details of which can be found on affiliate title Private Funds CFO (registration required). The asset class has expanded its approach beyond traditional finance MBA candidates to include people with backgrounds in everything from supply chain optimisation to technology to pricing, the report noted. “They’re seasoned industry executives who can serve as operating partners, and talent with data science and artificial intelligence backgrounds from large tech companies as digital transformation accelerates,” it said. Firms are also trying to increase diversity, including recruitment programmes at historically Black universities.

Those on the hiring trail may find recruitment harder than in prior years. Candidates are more often asking for better work-life balance and an inclusive workplace, prioritising those things even above pay, the report added. “If you don’t have the right culture, no rapport with colleagues, no challenging work, it becomes ‘I don’t want to get up in the morning. I don’t want to go in the office’,” Helen Thomas, global head of human resources at CVC Capital Partners, said in the report. “The challenging work and collaboration is always number one. Comp is secondary.”


Credit where it’s due
Growth giant General Atlantic has entered the private credit fray. The firm has agreed to acquire New York-based lender Iron Park Capital in a deal that will see it rebranded to General Atlantic Credit, our colleagues at Private Debt Investor (subscription required) report. Tripp Smith, chief executive and founder of Iron Park, will serve as chief executive of the unit. Credit has likely become a more appealing prospect for multi-asset GPs in an increasingly high interest rate environment. It is little coincidence, for example, that GA’s acquisition coincided with Nuveen‘s purchase of European private debt manager Arcmont Asset Management. Consumer specialist L Catterton, meanwhile, launched a private credit unit of its own back in July. With central banks expected to raise interest rates even higher in the near future, GA is unlikely to be the last new entrant we see this year.

Today’s letter was prepared by Alex Lynn with Helen de Beer and Madeleine Farman.