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Elevator assets

Elevator assets 2008-03-01 Staff Writer Private equity GPs have always been aware that their most important assets go down the elevator each night. Today they are waking up to the reality that in order to stay competitive, the firm elevator is going to have to transport many, many more such assets, and of an

Private equity GPs have always been aware that their most important assets go down the elevator each night. Today they are waking up to the reality that in order to stay competitive, the firm elevator is going to have to transport many, many more such assets, and of an increasingly variegated nature.

The March issue of PEI Manager focuses on how private equity firm managers are managing human capital. In regards to dealing with people, as with much else in private equity, what started with founder-led bootstrapping is morphing into systems and best practices.

On p. 20, Rob Kotecki looks at how three firms have structured performance reviews. Common in larger corporations, the performance review within a private equity firm is an institutional step beyond the more commonly practiced ?managing partner decides? model of setting annual compensation.

With private equity and venture capital firms stressing the transformative resources they can bring to bear on their portfolio companies, it is not surprising to learn that firms are focused on crucial paperwork, like securing visas. On p. 22, Jennifer Harris reports on the frustrating state of affairs in the US with regard to visas for highly skilled professionals. In a global economy, young companies need to hire the best talent regardless of what kind of passport they hold. In a digital economy, a short term fix to the US visa shortage is to set up key executives in countries other than where the startup's headquarters is based ? yet another reason for today's US venture capital firm to establish bases outside the US.

Finally, we're confident you'll find interesting the results of the survey that begin on p. 26. We believe it to be the most comprehensive compensation survey yet of CFOs and COOs at private equity firms. We also present details about the compensations of other key figures within the private equity firm, including IR professionals and general counsel. Professionals like these constitute the bulk of the increased human traffic in your elevator. But it's clear that there have emerged few standards across the private equity industry as to how what type of backgrounds these professionals should have and how they should be paid. But we can reveal this ? everyone wants a piece of the carry. And if your firm won't pay it, an increasing number of competitors will.

Enjoy the issue,

By David SnowDavid.s@peimedia.com