How do Private Equity Firms find deals?
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- čas přidán 4. 07. 2024
- How private equity firms find deals is a very thorough and complex topic. In this video, we discuss:
0:00 - Introduction
0:14 - How private equity deals are usual presented to investors
0:40 - What proprietary deal flow is (make connections, know the executives in the industry and market effectively)
1:44 - How to get good private equity deals through proprietary deal flow
2:37 - Real world example of proprietary deal flow
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#MinkLearning #privateequity #deals #investor #dealflow
I'm beginning to realize that people can get world class educations for free on CZcams these days. Take designations like CFA & CAIA (in the case of finance), for a fraction of the cost of an MBA to gain credentials and credibility. Designations like CFA are more respected by employers vs. MBAs anyway. For business/finance students, take these steps (ie. CZcams content/lectures, test prep providers for CFA/CAIA, join your local toast masters club, pass the exams); and voila.....you've saved yourself $100k by avoiding an unnecessary MBA!! If you're a real hustler you'll establish the connections on your own without needing the "connections" that come with paying for an MBA...When I see great educational videos like these, it grows my conviction that the education bubble will soon be popping. For select subjects at least, with business being one of them...
Leigh Smith amen.
Leigh Smith absolutely
uhhhh wtf did you just say
what are your thoughts on the CAIA?
@@WallStreetIceCream is good. More useful than CFA if you are not in equities/FI
This is very wise advice. It's all about relationships.
Thanks for your reply, Jonathan. I agree. It is!
You are great! “A guy knew a guy, who knew a guy.” Gerard Pizarro, Esq.
Thanks so much for your comment, Gerard!
I find value with the video steve! Can I request for steps how to start fund or investment management.? Thank you
Hi Arly, thanks for your comment. Have you seen our video titled "5 Tips to Raising a First Time Private Equity Fund"? Here is the link in case you are interested: czcams.com/video/pkIVGZCZrKc/video.html
Appreciate the video Steve!
Could you give some estimate on how many deals get done during 1 year and how many deal flows one firm gets during the same period?
I believe its impossible to say, depends on the market conditions
I heard there are 1 buyer for every 13 businesses
How do lawyers/accountants tell PE firms about companies going to be on the market soon, without breaking their confidentiality agreements & Code of Ethics? Do they get permission from the client first? Or do they recommend your PE firm to the client, and it's up to the client to reach out to you?
Great question, Sravya. Sometimes, when companies want to sell, they will ask their accountants/lawyers for warm leads. In other cases, the accountants/lawyers may know a buyer and get permission from the client to make an introduction.
Steve as a marketer what would say the best way to HELP PRIVATE EQUITY FIRMS and RIA's? What is a good match system?
Hi Russell, thanks so much for your message. That's a great question! RIA's should have a good due diligence process to help filter all of the funds that are available. If RIAs meet the minimum capital requirements, many PE funds will love to share all of their materials, data, etc to inform RIAs on whether to invest or not.
If RIAs don't have the capacity to look at a universe of funds, there are many placements agents that represent PE funds. Some placement agents include: Park Hill, Credit Suisse, etc
Please let me know if you have any further questions. Thanks again, Russell.
With PE you own a portion of the business or looking at owning all the business, improve it and then sell it for profit?
Hi Anna, thank you very much for your comment. That's a great question. PE investors can own both minority stakes (less than 50%) or majority stakes (more than 50%, including 100%). The timeframe of the investment will depend on who the PE investor is. If the investor is a private equity fund that has a certain fund length, it will be a shorter timeframe. If the investor is a pension fund or a family office that wants to hold the business for the long-term, then it will be a longer timeframe.
Also a note, there have been quite a few longer life private equity funds emerging in the industry. We did a video on that here: czcams.com/video/S-d1fLoQ55M/video.html
If you have any further questions, please let me know. Thanks Anna!
What about conflict of interest when making these proprietary deals?
Hi Kunal, great point. Conflict of interest is always something that can happen in these deals. With that said, most of the time, conflicts are disclosed and treated with care. That being said, it's a great point for you to bring up so people are aware of it.
a guy, who knew a guy, knew a guy: Saul Goodman
0:44 Proprietary deal flow
Thanks for adding this, Lucas!
Pdf. PROPRIETARY DEAL FLIW?
So basically you should be like 'Better Call Saul'
Maybe somebody can help me out Private Equity firms are the very same firms that have done / doing corporate raids in the 70s, 80s, 90s, (and now) yes? only today its called "active investing?" and the person / company is called the "activist shareholder?"
not necessarily. Corporate raiders can be PE, Hedge funds or big investors. Most of the corporate raiders that i've read about are big individual investors. when you belong to an industry (like PE or Hedge fund) you cannot afford to have an image of a corporate raider because as the video pointed out, you need connections in this business and its difficult to maintain connections when youve the image of an aggressive investor/raider.
Let my guys know some guys.
Here's a connection. I invented a new jet engine. It will cut fuel use in half.
Who should I contact about this?
You need a VC private equity firm in the industry
@@Stevenotfamous You'd think they'd be interested in talking. At least in finding out some basic information about the invention. No, they don't even respond. I'm thinking they really don't care about fuel efficiency. They will spend billions on a new digital platform that saves .5% fuel, but not talk to me about cutting fuel in half.
So I'm thinking this needs to go outside the normal channels. You know anyone like that?
You ever figure it out?
Steve
I follow you
but i think you give some bad suggestions here.
It's an old way of thinking.
waiting for the perfect deal.
while you wait your competitors move.
and in today's world your competitors move fast!
so what,
don't look or try to get the perfect deal.
It is much better to:
1.Know your industry
2.Push your entrepreneurs and managers to make better decisions
3.Strive to grow
4.Be involved
I'm sorry guys
but if you will will keep waiting for the perfect deal you will simply stay behind!