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PE VP Forum Recap | February 2022


February 21, 2022

By: Kyle Johnson

Every quarter we gather Vice Presidents in PE to discuss current industry topics and to offer these peers the chance to gather, share information, and decompress with one another. In our most recent event, we discussed many topics and have listed our top takeaways below.

These forums are invite-only and follow Chatham House Rules, so listed below are high-level takeaways only. Are you in private equity and interested in joining fellow PE VPs during our next PE VP Forum? Register here.

 

  • Firm Differentiation: Both fund-raising and then deploying capital are increasingly pressurized in 2022.  Business owners and LPs are trying to differentiate between approaching PE firms. It’s important to LPs and owners (especially founders) that you and your firm are doing something “different”- either from a track record or industry knowledge perspective.  Some firms are leaning into well-defined theses with continued pressure testing, and many are complementing this with additional operational or advisory resources. Firms can make deeper connections with owners by relying on the experience of operating partners or senior advisors who have true industry experience.  Show that you as an investor know where businesses have been, where they are growing, and how you can help them reach potential.
  • Deal Sourcing: When it comes to identifying potential assets for acquisition, firms are approaching this task in different ways.  Some are sticking strictly to investment theses and related lists of companies, then ticking down these lists.  Others are leaning heavily into the connections of their LPs and Partners. Not only does this make networking with business owners easier, but deal teams can move quickly once they have exclusivity due to their existing knowledge of the vertical. Focus on geography worked to the advantage of some firms during the pandemic, and firms are finding it easier to build a relationship with business owners who are local to them. Whether this means more in-person meetings or simply the connection between people from a similar area, it’s driving meaningful deal flow.
  • Developing and attracting junior talent: How to get junior talent in the door? If your firm is based in a smaller or more regional city (St Louis, Detroit, Nashville), stay in touch with those who are local to the area but may be working in banks along the coast.  Many were interested in returning “home” during the pandemic. Other firms are cultivating relationships with local investment banks and hosting happy hours to meet with potential associate talent, thus creating a local pipeline to source junior talent. Some firms are looking beyond strict modeling skills (which can be taught), and leaning more into prioritizing soft skills and executive presence. Once these hires are made it’s important to get them involved in workstreams that make them feel like they’re contributing to firm initiatives. Culture is key, which is becoming easier as people return to the office.

We thoroughly enjoyed getting to gather with PE VPs to discuss these current industry hot topics. We’s be happy to connect you to the PE-grade, exact-fit, third-party resources to assist you in this tight market, just contact us here.

Learn more about how we can specifically help Deal Quarterbacks and access a toolkit that can help you do your job more efficiently here.