Author Archives: Victor De Pierrefeu

Debt set go

Not everyone enjoys buying a round. It depends how much money you have on you and how big the round is!It seems that a lot of SVB’s start-up tech clients also had trepidation over the fears of down rounds, preferring instead to opt for debt over equity; and so delay inevitable lower valuations. This helps, to some extent, explain why private market valuations remained relatively strong last year, while public market tech stocks got eviscerated as investors grew concerned over long-term growth and profitability in a rising rate environment. The consequence of SVB’s implosion will be significant, with far less venture debt leading to an inevitable slew of lower valuation down rounds, tech failures and employee layoffs. Jay Powell’s hopes to combat high inflation could come true sooner than he thinks.

inspired by CB Insights

Sili-gone Valley Bank

And so it ended. In the space of 24 hours, Silicon Valley Bank, the go-to bank for many US tech start-ups and VC funds, succumbed to a classic bank run as depositors scrambled to get their money out. And so it ended. In the space of 24 hours, Silicon Valley Bank, the go-to bank for many US tech start-ups and VC funds, succumbed to a classic bank run as depositors scrambled to get their money out.

inspired by Markets Insider

Punch line (item)

Private equity can boost absolute returns when added to traditional diversified portfolios and remain a star performer among alternative asset classes.With inflation showing signs of persistence, investors will be hoping that PE funds can continue to turbo charge their overall risk-adjusted returns in the coming years. KKR’s latest white paper – Regime Change: The Role of Private Equity in the ‘Traditional’ Portfolio – outlines why the firm remains bullish in the current macro environment, in particular highlighting the importance of PE’s illiquidity premium. The report’s authors main punch line is that nimble value creation opportunities, efficacy in timing investments and exits, and company selection have been important drivers of performance. Investors will hope to remain entertained and applauding future returns as they continue to tap in to the power of PE.

inspired by KKR

Lofty ambitions

Sport as an asset class is becoming somewhat of a slam dunk with sports-focused investment firms attracting $10 billion of capital.NBA All-Star legend Carmelo Anthony is the latest high profile name, building on an already active investment career to launch Isos7 Sports Investments, a PE fund that he is co-founding with George Barrios and Michelle Wilson. More PE/VC are developing a full court press to invest in sports franchises and associated businesses. Isos7 will use Carmelo’s industry nous to seek out minority positions in teams and leagues and build on his vision of being a ‘digital athlete’. With an estimated total addressable market (TAM) of $400 billion, expect to see more high-profile athletes entering the PE world in a bid for further glory.

inspired by Sports Business Journal

Green. Clean. Money Machine.

Impact investment funds are growing in prominence, with GPs keen not to miss out and feel green with envy as investors seek to make financial returns while also having a positive impact on the world.Though far from a new trend, in private equity inflows are rising in to this asset class that is estimated to be worth $1.2 trillion. With TPG raising $7.3 billion for its sixth impact fund, other prominent names are stepping in to focus on green investments, including KKR who just raised $2 billion for their second such fund. As the trend develops, there are calls among regulators to tighten up how GPs quantify the ‘impact’ of these funds and avoid greenwashing. It is not inconceivable that the industry ends up with 50 shades of green, if more impact funds come to market. How GPs define their ambitions, and measure them, will be watched closely by investors and regulators alike.

inspired by Financial Times