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| About the Author | |
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| Acknowledgements | |
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| Introduction | |
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| What is Private Equity? | |
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| What is Private Equity? | |
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| Fund investing versus direct investing | |
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| Co-investment | |
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| Terminology | |
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| Different types of Private Equity investment | |
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| Summary | |
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| What are Private Equity Funds, and How do They Work? | |
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| Capital: Allocated, Committed, Drawn Down and Invested | |
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| How do Private Equity Funds Work? | |
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| Structure | |
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| Cash flow | |
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| Investment | |
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| Fundraising | |
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| Private Equity Funds Distinguished from Other Fund Types | |
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| Hedge funds | |
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| Infrastructure | |
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| Private (Equity) Real Estate | |
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| A Note on International Issues | |
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| Summary | |
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| Private Equity Returns - The Basics | |
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| Understanding the J-curve and Compound Returns | |
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| Upper Quartile Figures | |
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| Median Returns | |
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| Average Returns | |
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| Pooled Returns | |
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| Using Vintage Year Returns for Benchmarking Purposes | |
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| Time-weighted Returns | |
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| Summary | |
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| Private Equity Returns - Multiples and Muddles | |
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| Multiples | |
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| Distributed over paid in (DPI) | |
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| Paid in to committed capital (PICC) | |
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| Residual value to paid in (RVPI) | |
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| Total value to paid in (TVPI) | |
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| Use of multiples in industry research | |
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| Muddles, Muggles and Markowitz | |
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| Returns | |
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| Risk | |
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| Liquidity | |
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| Summary | |
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| Buyout | |
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| Types of Buyout Transaction | |
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| MBO | |
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| MBI | |
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| BIMBO | |
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| LBO | |
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| Take Private (P2P) | |
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| Roll-up | |
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| Secondary Buyouts | |
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| Other 'Buyout' Activity | |
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| PIPEs | |
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| How do Buyouts Work? | |
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| Characteristics of Buyout | |
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| Established businesses | |
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| Debt | |
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| Earnings | |
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| Size | |
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| Control | |
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| Barriers to entry | |
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| Summary | |
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| How to Analyse Buyouts | |
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| Earnings | |
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| EBIT | |
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| EBITDA | |
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| Earnings Growth | |
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| Multiple | |
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| Multiple increase (sometimes called multiple arbitrage) | |
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| Leverage | |
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| Recapitalisation | |
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| Timing | |
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| Modelling and Analysing Buyout Funds | |
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| Enterprise value | |
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| Summary | |
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| Buyout Returns | |
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| US versus European Buyout | |
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| Buyout skill bases | |
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| Imperfect markets | |
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| Earnings multiples | |
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| Earnings growth | |
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| Leverage | |
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| Contribution of different drivers | |
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| Fund size | |
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| Summary | |
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| Venture Capital | |
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| What is Venture Capital? | |
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| Backing New Applications, Not New Technology | |
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| Classifi cation by Sector | |
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| IT | |
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| Telecoms | |
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| Life Science | |
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| Classifi cation by Stage | |
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| Seed stage | |
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| Early stage | |
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| Mid and late stages | |
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| Summary | |
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| How to Analyse Venture | |
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| The Fundamentals (1) - Money Multiples | |
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| The Fundamentals (2) - Valuation | |
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| Valuation as an element of stated returns | |
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| Differences in valuation approach between Europe and the US | |
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| Variability of Venture valuations | |
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| Pre-money and post-money valuations | |
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| Share classes | |
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| The Fundamentals (3) - Cost and Value | |
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| IRRs and multiples | |
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| Going in equity (GI%) | |
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| Percentage of the holding within the fund | |
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| The Impact of Home Runs | |
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| Summary | |
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| Venture Returns | |
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| US Outperformance versus Europe | |
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| Money multiples drive IRRs | |
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| Home runs and the golden circle | |
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| Market conditions | |
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| European Venture - Is it as Bad as it Seems? | |
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| Returns and Fund Size | |
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| Venture returns by stage | |
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| What of the Future? | |
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| Summary | |
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| Growth and Development Capital | |
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| The PLC and the BCG Growth Matrix | |
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| Development Capital | |
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| Target companies | |
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| Money in deals | |
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| Money out deals | |
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| Objectives | |
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| Growth Capital | |
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| Target companies | |
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| Objectives | |
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| Growth capital and late-stage Venture | |
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| Common Issues | |
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| Minority protection | |
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| Exit protection | |
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| The Future | |
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| Summary | |
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| Secondary Private Equity Fund Investing | |
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| Why do People Buy Secondaries? | |
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| Time and the J-curve | |
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| Diversifi cation by time | |
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| Diversifi cation by geography and sector | |
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| Treasury and Portfolio Secondaries | |
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| Why do People Sell Secondaries? | |
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| Change of strategy/leaving the asset class | |
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| Overconcentration by time, sector or geography | |
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| Unexpected need for cash | |
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| Housekeeping | |
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| Dissatisfaction with the GP | |
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| Restrictions on Transfer | |
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| Stapled primaries | |
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| Secondary Methodology | |
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| Tails | |
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| Fees etc | |
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| Secondary Buyouts - Warning | |
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| Summary | |
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| Due Diligence | |
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| Buyout Funds | |
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| Venture Funds | |
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| Co-investors | |
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| Cross-fund Investing | |
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| Buyout Companies | |
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| Venture Companies | |
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| Funds of Funds | |
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| Growth and Development Capital | |
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| Monitoring Private Equity Funds | |
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| The Changing Nature of Due Diligence | |
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| Summary | |
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| Planning Your Investment Programme | |
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| Cash Flow Planning | |
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| Allocated, Committed and Invested Capital | |
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| Diversifi cation by Time | |
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| Proper Commitment Levels | |
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| Diversifi cation by Sector and Geography | |
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| Total Return | |
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| How to deal with uninvested capital | |
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| Towards a New World of Private Equity Programmes? | |
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| Summary | |
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| Trends and Issues | |
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| Financial Crisis | |
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| Credit | |
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| Valuation | |
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| Holding periods | |
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| Secondaries | |
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| Emerging Markets | |
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| Concluding Thoughts | |
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| Track record | |
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| Returns | |
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| Fee structures | |
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| Private Equity at a Crossroads? | |
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| Summary | |
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| Glossary of Private Equity Terms | |
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| Index | |