OUR MID-MARKET PANEL
(Managing Director – Wind Point Partners)
(Principal and CFO – Cloverlay)
(CFO – XPV Water Partners)
(President – Littlejohn & Co)
(Founder and CIO – Vector Capital)
(Co-CEO – The Riverside Company)
(CEO – MidOcean Partners)
What is a trend that doesn’t get enough attention?
TV: Over the past 15 years, virtually every mid-market PE fund has transformed from a generalist fund to a sector and geographic-focused fund. Sector knowledge is now table stakes to effectively source and operate successful companies.
NB: We have seen the need for minority equity or preferred equity increase in the mid-market. We have accessed capital from other private equity funds to meet this need in our own portfolio.
OH: The use of operating partners might face greater scrutiny. There’s room for conflicts of interest and perhaps LPs are paying too great a share of the cost. I expect more transparency around these fees in the future.
BR: While great companies get pre-empted at jaw-dropping multiples, an asset that has even a little hair on it may find that nobody shows up at auction. The leverage markets are similarly bifurcated. Some bank deals are two times oversubscribed at record tight spreads, while for others, the underwriters can’t find a bid. In this environment, some of these ‘busted’ deals are worth a closer look.