31
May

Private Equity Forum 2018 Highlights Part II: Top 5 from PE US Forum

Posted by: AmberRoberts in: Financial Services -

This year’s gathering of elite private equity players at MarketsGroup’s 7th Annual Private Equity US Forum covered a lot of ground, from the impact of tax reform on valuations to the best ways to find non-correlated PE investments. Here are our top 5 takeaways:

 

  1. Despite SEC leadership changes, PE is not getting a break. While new faces are steering the ship at the SEC, it hasn’t led to fewer exams or less interest in PE firms. However, enforcement staff seem to be more open to discussions as opposed to fast tracking to the settlement stage.
  2. Conflicts of interest can’t always be solved with a “wall”: Conflict of interest is a timely issue, particularly for PE that is expanding into new areas of business, such as credit or REITs. A “wall” is an increasingly popular solution, but it does not work for all and may cause a silo effect that prevents critical collaboration and information sharing internally.
  3. Due diligence is taking new forms: New “non-traditional” types of due diligence are emerging, including anti-money laundering and know-your-customer due diligence. Such due diligence covers traditional and social media reputation, political affiliations and exposure, trading exposure and other critical pieces of intel.
  4. Organic growth a priority for portfolio companies: While add-on acquisitions remain desirable for a host of reasons, organic growth is highly coveted and still a focus for PE owners. Both artificial intelligence and predictive analytics are increasingly enabling companies to be more agile, make better decisions and expedite growth.
  5. Economic downturn inevitable, but we still have time: We should be prepared for an eventual slowdown. However, with job rates up, interest rates still relatively low and banks in good standing, the U.S. economy should be fine in 2018 and 2019.
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31
May

Private Equity Forum 2018 Highlights Part I: PE can drive organic growth for portfolio companies

Posted by: AmberRoberts in: Financial Services -

I recently had the privilege of spending two days with LPs, funds and advisers at one of the leading private equity industry events, MarketsGroup’s 7th Annual Private Equity US Forum. This year, I participated in a roundtable conversation, “Adding Value to Portfolio Companies,” a challenge I have been tackling for more than 10 years through marketing and PR counsel for PE client portfolio companies.

My fellow panelists represented various areas of expertise – sales and marketing, data, financials, operations, risk and insurance — and the group identified several best practices for taking portfolio companies to the next level. While all conceded that add-on acquisitions can bring immediate revenue, this source of growth inherently comes with a host of issues, such as integration, that require careful management.

The net of our discussion: organic growth is indeed the “holy grail” for portfolio companies. For those embarking on an organic growth strategy, the panel raised several key aspects to consider:

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03
May

BEYOND THE TOMBSTONE: WHY DEALMAKERS NEED PR MORE THAN EVER

Posted by: AmberRoberts in: Financial Services -

For the VC and private equity community, PR is like holiday decorations or fancy napkins: something to be pulled out for special occasions – such as important transactions and deals – then stashed in the back of the closet until the next party. While deal-driven campaigns are certainly an important opportunity for investment firms to elevate their brands, they are only one part of the equation.

Investment firms need to have meaningful visibility independent of transaction events, especially in today’s competitive climate, where nontraditional sources of capital also compete for limited deal flow. In the Pitchbook Platform’s recent survey of 45 private equity firms, 91 percent reported that the need for a strong brand has increased in just the past two years. To elevate and differentiate its brand, a firm must adopt a cohesive, ongoing brand communications program that articulates key value propositions both in and beyond a transactional context.

Messaging: Getting the Story Straight

The most important element of any strategic communications program is getting the messaging right. In institutional finance and investment, deals are made based on numerous factors, from metric-driven criteria to intangibles that may include chemistry with senior management or perceptions in the marketplace. The trick is to encapsulate relevant points in a cohesive and comprehensive narrative that resonates with potential investors.

Stakeholders invest in a story as much as they invest with a firm or in a deal. Telling a story clearly involves breaking it down into its foundational elements, including:

  • Mission/purpose: articulating not just the “what”, but the “why”
  • Origins and evolution: conveying the background
  • Investment philosophy: explaining the underlying innovative thinking
  • Distinct differentiators: highlighting qualities that set a firm apart

A comprehensive messaging platform may include additional elements, which should be identified at the outset of a program. This diligence ensures a narrative is communicated clearly and consistently across channels, at inception and throughout an ongoing program.

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