Tailor made

It's official – private equity players have become a distinct audience to be courted. More and more service providers beyond law firms are tailoring their products to the needs of the private equity industry.

This past February, the accounting firm Grant Thornton LLP, the US member firm of Grant Thornton International, announced a new private equity initiative that presents a ?comprehensive approach? to serving firms and their portfolio companies. Cal Hackeman, a managing partner within the firm, is leading the initiative to centralize their efforts on behalf of private equity clients.

A ?relationship partner or partners? would serve as a focal point of contact for a GP. That partner or partners would then design the most efficient way to deploy Grant Thornton's capabilities for the firm, including those applicable to its portfolio. The rationale is to capitalize on the firm's current client experience, which includes 300 different firms so far, to better marshal their resources for the unique demands of the industry.

Meanwhile, the UK advertising group M&C Saatchi launched a niche ad agency devoted to portfolio companies of private equity firms. The firm, known as Accelerator, says it will offer lean branding solutions that mimic the sparse style of a private equity firm. Accelerator plans to create marketing plans for portfolio companies in six weeks instead of the standard four to six months.

M&C Saatchi's idea is to create simple propositions for the businesses that don't require endless rounds of research to substantiate. Most importantly, the agency would defer the majority of its fees until the firm exits the business. M&C has already enjoyed success with private equity clients, most notably with the design of ?We go the extra mile? for Halfords, as CVC Capital Partners was prepping the IPO for the UK auto parts and bicycle retailer.

And in August of 2006, United Healthcare, the health insurance provider, began offering a plan whereby a private equity firm can purchase medical benefits in aggregate for the entire portfolio at once, for substantial administrative and cost savings. The plan offers customization within the individual companies, including partial and retiree programs, with the capacity for international services as well. The offering also allows policies to be held in the name of the individual businesses, so the GP doesn't have to stand as the holder of record for all the policies.

When cola companies are asking themselves what placement agents drink, and movie studios are test-marketing blockbusters to cater to GPs' tastes, we'll know that private equity has truly become a consumer group to be reckoned with.

Four US heavyweights join BVCA
Bain Capital, The Blackstone Group, Kohlberg Kravis Roberts and The Carlyle Group joined the BVCA, the UK's private equity trade association, all within the last 15 months. The four buyout firms became members as the industry tries to improve its image in London. KKR is the only one of the four that is also listed a member of the EVCA, the European association for the industry. All four are members of the US-based Private Equity Council, a lobbying body that represents the views of large buyout firms. That council formed last year because the NVCA, the American counterpart to the BVCA, focuses primarily on the venture capital market.

Thoma Cressey adds Bravo to its name
Chicago-based private equity firm Thoma Cressey Equity Partners has changed its name to Thoma Cressey Bravo ?in recognition of the substantial contributions of Orlando Bravo.? Bravo, who joined the firm in 1998, is a managing partner of the firm and heads both its San Francisco of-fice and software and technology services investments. According to the firm's website, over the past four years, Bravo has led or co-led seven software-related buyouts for about $2 billion (€1.5 billion), and has closed 17 addon acquisitions valued at approximately $1 billion. This is not he first time managing partners Carl Thoma and Bryan Cressey have seen their firm transformed. In 1998, they split from Chicago private equity firm GTCR, which originally launched in 1980 as Golder, Thoma, Cressey, Rauner. GTCR is now called GTCR Golder Rauner. Thoma Cressey Bravo manages nearly $2 billion in equity capital.

CVC crosses the Atlantic with New York opening
European private equity giant CVC Capital Partners has opened a US office in New York, its first in the Americas. Of the over $18 billion (€16.8 billion) the firm has raised since its inception in 1981, none have come from the US. The New York office will be headed by Christopher Stadler, who joins as managing director from Investcorp. Stadler had been head of private equity, North America for the Bahrainquoted alternatives group, since 2001 after joining as managing director in 1996. Before joining Investcorp he was director of corporate finance for Credit Suisse First Boston, an investment bank. Rolly van Rappard, a cofounder of CVC Capital Partners Group, will work with Stadler to establish the firm's US presence. The firm also recently made a series of internal promotions, including that of four new managing directors. The most senior of the appointments was the promotion of Marc Boughton, who becomes a managing partner of the firm in London.

Six Sigma not silver bullet for back office, says report
Research from strategic advisory firm The Hackett Group has found that executives seeking to reduce cost and improve overall quality of back office operations who say that Six Sigma is far from a ?silver bullet? misunderstand Six Sigma initiatives. Six Sigma is defined as an incremental process improvement methodology to drive selling, general and administration (SG&A) functions such as finance, information technology, procurement and human resources. Hence, it will not be appropriate for situations that require significant transformational change. According to Hackett, executives can reduce annual SG&A costs by $60 million per billion in revenue only if Six Sigma is implemented correctly. Some reasons for failure to achieve these types of results include not personalizing a program, failing to ignore company culture, taking a piecemeal approach and failing to take an appropriate customer-centered outlook.