Fund Shack Fund Shack

Founded in mid-1990s, Partners Group launched its first vehicle accessible to individual investors in the early naughties. Today it is at the frontline of the democratisation of private equity.
In this episode, Ross Butler speaks to Joanna Asfour, the firm's managing director of client solutions, to discuss how private equity can help DC pensioners in the UK access private markets.
We look particularly at LTAFs, the UK equivalent of ELTIFs and the various nuances of providing relatively simple access to the asset class for DC pension trustees, which can often require the involvement of life insurance platforms and master trusts.

Jim Strang, serial private equity NXD and chairman of Hg Capital Trust, discusses the complexities of the private equity landscape on the Fund Shack podcast.

Fundraising and Market Dynamics:
Market Polarization: Large platforms and top-performing specialists continue to raise significant capital, while mid-sized players face extended fundraising cycles.
Liquidity Challenges: Investors are managing overexposure from the 2021 boom, causing liquidity issues across different regions.

GP Strategy and Growth:
Clear Ambitions: GPs focus on defining clear ambitions and achieving team alignment.
Strategic Growth: Balancing ambition with operational capacity, strategies range from maintaining a single focus to expanding into adjacent areas through M&A.

Wealth Market and Semi-Liquid Structures:
Growing Market: Wealth market growth through semi-liquid structures designed for high-net-worth individuals.

NAV-Based Exposure: These structures offer accessible entry points for private market investments, requiring careful liquidity management.

ESG and Cybersecurity:
Central to Strategy: ESG considerations driven by investor demand and talent acquisition needs.
Top Risk: Cybersecurity remains a top risk, with firms prioritizing mitigation measures to protect portfolios.

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Thank you to our episode partner Quest Fund Placement.
The firm recently launched QuestInvest, the digital hub and gateway to alternative assets that connects accredited investors with leading GPs.
For more information, please visit https://www.questfundplacement.com/

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#privateequity #fundraising #wealthmanagement #esg #cybersecurity #privatemarkets
#capitalmarkets #alternativeassets
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Sunaina Sinha, Global Head of Private Capital Advisory at Raymond James, talks to Ross Butler about the challenges of raising private capital funds in today's market.
This episode is supported by Datasite, the leading M&A platform for dealmakers. https://www.datasite.com/en
Fundraising cycles have extended to 22-23 months on average, reflecting the challenging environment. Firms must offer co-investments, fee discounts, and management fee holidays to attract investors. The tenor of fundraising conversations has shifted, with private equity firms needing to provide various incentives to secure commitments.
We cover dry powder, the rise of co-investments, and the influence of Middle Eastern and private wealth in the market.
2023 was marked by significant challenges due to a liquidity squeeze and reduced exit activities. 
This environment has been tough for institutional limited partners, leading to a shift in investment metrics. (i.e. DPI is the new IRR)

Rise of Co-Investments
How investors are leveraging their power to demand fee-free co-investments.

Sector Focus: Private Credit and Infrastructure
Private credit is booming due to bank pullbacks and high-interest rates, while infrastructure investments are attractive due to their tangible nature and inflation resistance. 

Thank you to our episode partner Datasite, the leading M&A platform for dealmakers.
For more information, visit: www.datasite.com
#wheredealsaremade

#PrivateEquity #privatecapital #alternativeinvestments #Fundraising #RaymondJames #InvestmentTrends #DPI #CoInvestments #PrivateCredit #Infrastructure

Ross Butler hosts Patrick Turner, Managing Director at VSS Capital Partners, a US-based lower mid-market private equity firm founded in 1981, originally named Veronis Suhler Stevenson. Patrick joined VSS in 2014, bringing a wealth of experience from his extensive career in leveraged buyouts in the US, and private equity in China. VSS focuses on the US lower mid-market, specifically targeting three verticals: education, healthcare, and outsourced business services with a technology angle. VSS’s approach to structured capital, which includes debt, preferred equity, and equity, tailored to the needs of founders looking to grow their businesses without giving up control. This strategy allows VSS to be competitive and less dilutive compared to traditional growth capital.

KEY HIGHLIGHTS:
VSS focuses on the US lower mid-market, specifically targeting three verticals: education, healthcare, and outsourced business services with a technology angle. VSS’s approach to structured capital, which includes debt, preferred equity, and equity, tailored to the needs of founders looking to grow their businesses without giving up control. This strategy allows VSS to be competitive and less dilutive compared to traditional growth capital.

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#privateequity #venturecapital #MidMarket #StructuredCapital #privatecredit #leveragedbuyouts #growthcapital #BusinessServices #HealthcareInvestment #EducationInvestment #TechInvestment #AlternativeInvestments #podcast

Fund Shack is a private equity podcast and global media channel for alternative investment professionals. Fund Shack is produced by Linear B Group and if you are interested in appearing on the show, wish to propose a client, or are interested in sponsorship, contact:
Katie Mitchell
katie@linearb.media
Linear B Group

Fatou Diagne is co-founder of Bootstrap Europe, which acquired the German portfolio of Silicon Valley Bank in 2023. She provides a fascinating insight into the elite world of lending to the top tier of venture-backed businesses. Venture debt might not have the brand-pizazz of its equity cousin, but from a risk/return perspective it ticks all the boxes.
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This episode also features our supporters, RW Blears, a UK law firm specialising in fund management. If you are a UK venture capital manager or growth investor and need a trusted legal adviser visit RW Blears
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Ross Butler interviews Fatou Diagne, co-founder of Bootstrap Europe. Fatou offers a compelling look into the world of venture debt, focusing on its role in funding high-growth technology businesses and its strategic advantages compared to traditional equity financing.
Introduction to Venture Debt: Fatou Diagne explains that Bootstrap Europe provides debt funding to technology companies that have already received substantial equity investment. These companies are usually 5 to 7 years old, generating revenues of 5 to 20 million euros, and are backed by top-tier venture capital funds.
Target Companies: Bootstrap Europe targets mature technology companies that have a proven growth formula but prefer not to dilute their equity further. The firm focuses on sectors like semiconductors, life sciences, and energy transition, seeking to support technologies that can significantly impact society.
Venture Debt is way cooler than you think! Fatou clarifies that venture debt is often misunderstood. It is not a last resort for companies that cannot raise equity; instead, it is a strategic choice for well-capitalized companies looking to accelerate growth without further dilution.
Deal Flow and Timing: Bootstrap Europe follows potential investment opportunities for several years, waiting for the right inflection point to provide growth debt. The firm typically invests after one or two rounds of equity funding, although this can vary.
Benefits for Companies: The main advantage for companies using venture debt is the avoidance of dilution. Founders and early-stage investors can maintain larger stakes in the company, enhancing their returns upon exit.
Terms of Venture Debt: The terms are transparent, with interest rates typically around 8-10% over the base rate. The debt is repaid over 3-4 years, with monthly payments of interest and principal.
Bootstrap Europe’s Approach: The firm emphasizes a strong relationship with portfolio companies, focusing on providing support during both good and challenging times. They prefer to work closely with management teams to navigate growth and financing challenges.
Acquisition of Silicon Valley Bank's German Portfolio: In 2023, Bootstrap Europe acquired the German portfolio of SVB. Fatou discusses the strategic and operational steps taken to complete this acquisition, emphasizing the importance of speed and expertise.
Current Market Conditions: Fatou comments on the impact of global economic challenges on the tech sector, noting that while the market has cooled, there are still many high-quality investment opportunities. She highlights the importance of well-capitalized companies that can navigate difficult conditions to gain market share.
Future Growth & Challenges: The discussion touches on the growth potential of venture debt in Europe and the challenges of increasing market penetration. Fatou believes that with more education and understanding, venture debt can become a more prominent part of the funding landscape.
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 #venturecapital #privateequity #techfunding #growthcapital #venturedept #debtfinancing #innovationtechnology #techinvesting #podcast #BusinessPodcast #FinancePodcast #Entrepreneurship
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Fund Shack is produced by Linear B Group and if you are interested in appearing on the show, wish to propose a client, or are interested in sponsorship, contact:
katie@linearb.media
Linear B Group

Mike Smeed is managing director of InMotion Ventures, the corporate venturing arm of Jaguar Land Rover.
In this episode of the Fund Shack podcast, he speaks to Ross Butler about what the company looks for in start-up candidates and the rapidly evolving nature of corporate venture capital.
Mike the Managing Director of InMotion Ventures, the corporate venture capital (CVC) arm of Jaguar Land Rover (JLR). Mike discusses his career background, including roles at a Shanghai-based joint venture and Walgreen Boots, and delves into the unique aspects of CVC compared to traditional venture capital (VC).

Key Points:
Corporate Venture Capital (CVC) vs. Venture Capital (VC):

Similarities: CVC and VC both perform due diligence, focus on valuation and metrics, and aim for strategic investments.

Differences: Historically, CVCs were viewed skeptically due to fears of corporate overreach. Modern CVCs have adopted VC professionalism and often invest off their parent companies’ balance sheets, with some even taking external capital.

Role of InMotion Ventures:

Strategic Focus: InMotion Ventures aims to accelerate innovation and support JLR’s strategic transformation, especially in areas like climate, industrial, and enterprise technologies.

Investment Approach: Unlike many CVCs, InMotion invests in early-stage startups (seed to Series A) to add significant value to both JLR and the startups.

CVC Evolution:

Professionalization: Many CVCs now operate with the same rigor as traditional VCs, including thorough background checks and strategic valuations.

Integration with Parent Companies: CVC leaders often come from within the parent company, blending corporate insight with investment acumen.

Strategic Mandate:

Innovation and Collaboration: InMotion Ventures aims to help JLR achieve carbon neutrality by 2039 and focuses on technologies critical to this transformation.

Partnerships: The firm prefers co-investing and does not lead funding rounds, maintaining about a 5% equity stake to ensure active involvement without overwhelming influence.

Investment Justifications:

Ecosystem Access: Being an active investor attracts other investors and startups, facilitating ecosystem engagement.

Innovation and Speed: Investing in startups accelerates innovation and market readiness, providing JLR with early access to cutting-edge technologies.

Capital Efficiency: Strategic investments leverage larger rounds by financial VCs, maximizing impact with relatively small contributions.

Success Stories and Examples:

Investments: Mike discusses successful investments, such as in companies developing head-up displays and augmented reality technologies.

Collaboration with Competitors: InMotion Ventures collaborates with other automotive giants like Volvo and BMW to co-invest in promising technologies.

Value to Startups:

Strategic Support: Startups benefit from JLR’s extensive resources, including engineering expertise and testing facilities.

Mutual Benefits: While InMotion seeks financial returns, the primary goal is strategic alignment with JLR’s broader goals.


Conclusion:
The interview highlights the evolving landscape of CVC, emphasizing strategic partnerships, professional investment practices, and the mutual benefits of fostering innovation within large corporate structures. Mike underscores the importance of balancing financial returns with strategic goals to drive both corporate growth and startup success.

#Innovation
#Technology
#DigitalTransformation
#VentureCapital
#Startups
#Entrepreneurship
#CorporateVenture
#AutomotiveIndustry
#Sustainability
#FutureOfMobility
#BusinessGrowth
#EmergingTechnologies
#Industry40
#TechInvestments