Now, why would that be? In the mid 1990s Russ founded his own middle market buyout shop before joining Merrill Lynch Investment Managers, where he built the private equity solutions business that we have today at BlackRock and oversees $34 billion in LP commitments. More than half of co-investment capital has gone into pre-bid transactions, enabling us to do deeper due diligence, have stronger influence on results and obtain scalable allocations. The common sentiment among Limited Partners and General Partners in the private equity (PE) asset class is that fund returns will take a hit this year. Using earnings before interest, tax, depreciation and amortization-to-enterprise value (EBITDA/EV) as their metric for expected returns, the ex-ante return premium for private equity fell from about 5 percent at the start of the period to zero by 2006—and has lingered around zero ever since. ERM Webinar COP21 and the Paris Agreement What does it mean for business? The Lightsmith Group pursues private equity investments that generate superior returns for investors. The most active restaurant private equity firms aren’t necessarily restricted to one country, with deals increasingly cropping up in Asia, the Middle East, and South America, and chains in nearly every corner of the globe finding investment. ESG investing Capital at risk. RisCura - SAVCA South African Private Equity Performance Report Q3 2018 Private equity returns have consistently outperformed listed equity returns over the three-year and five-year periods, yielding positive direct alpha and a public market equivalent (PME) above 1. Well, first of all thank you, Amy, for the very kind introduction and, Jeroen, it's nice to see you to talk about private equity. The State Street Private Equity Index (SSPEI) posted its second-highest quarterly performance in the past two years with a return of 4.35% in the … My name is Amy Park and I'm a Product strategist for BlackRock Private Equity Partners, also known as PEP. This forward looking survey provides valuable insight into how fellow private equity (PE) practitioners view the landscape at present as well as their future expectations. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy. 22 July 2011 . And that is the number of assets that you need in the portfolio. He highlighted the opportunities to generate returns while leaving behind “firms, farms and factories” essential for … This webpage will assist you to learn more about Africa Private Equity, Private Equity Africa Investors, and how to raise funding from African Private Equity investors.. First a little about us…..our team has enormous experience in Africa’s investment world. BlackRock has not examined any of these websites and does not assume any responsibility for the contents of such websites nor the services, products or items offered through such websites. Following two decades of strong growth, private equity now presents a large collection of strategy offerings and multiple ways to invest. So, as we always do in the industry, we talk about returns of individual assets and the importance of selection to the overall portfolio. This website and its content is not intended for, or directed to, investors in any countries or jurisdictions that are not enumerated above. The total value of private equity deals across Africa last year was US$3.5bn, from US$3.9bn in 2017 and US$4bn in 2016 – and well down from US$7.8bn in 2014. To view this video please enable JavaScript, and consider upgrading to a Lightsmith partners with growth-stage companies that address critical societal needs and helps the companies scale their solutions globally. European fund manager Star Capital Partnership will provide investment to drive the firm’s growth plans, with M&A being an integral part of Hawkford’s strategy. Starting at at&t in the late 80s, we actually started to add co investments, which really no one else was doing at the time, which was investing side by side with the general partners we had in our portfolios. We are designed to deliver compounded private equity returns and better alignment with investors and investee companies. Part of the SuperReturn Series – the world’s leading private capital events Phatisa’s vision is to be the leading sector-focused development equity fund manager in Africa. A million doses of the AstraZeneca vaccine were delivered to South Africa from India last month. Investment involves risk including possible loss of principal. It was simple back then it was venture capital in non venture capital. Financial Returns On Principle. This Website is for your personal use. Equity compensation can be a valuable tool for private companies to tie executives’ compensation to company performance, but determining the value of that equity takes more consideration without the readily available market setting a price. Through our Private Equity business, we serve as a catalyst, unlocking massive economic potential across emerging economies in West Africa. Welcome to our first edition of a new audio series PEP Talks with Russ. BlackRock® is a registered trademark of BlackRock, Inc., or its subsidiaries in the United States and elsewhere. From a research point of view as well as a practice point of view, related to your question, you know, we know from public market research and academic research on portfolio construction and the impact on its total return in a portfolio that it's probably 90 to 92% with the remainder being the residual effect of the individual assets or selections that are in the portfolio. FOR INSTITUTIONAL, FINANCIAL PROFESSIONAL, PERMITTED CLIENT AND WHOLESALE INVESTOR USE ONLY. You acknowledge that certain information contained in this Website supplied by third parties may be incorrect or incomplete, and such information is provided on an "AS IS" basis. As a user, you must not sell, copy, publish, distribute, transfer, modify, display, reproduce, and/or create any derivative works from the information or software on this Website. You know, the bigger they are, the safer they are, most likely the lower return, you're going to get off the asset, and probably a higher correlation to public markets. As an […] A period of ten years is considered an appropriate benchmark for a comparison of returns, given that private equity is a long-term asset class. You must not redeliver any of the pages, text, images, or content of this Website using "framing" or similar technology. Africa Private Equity News is a well-established, trusted news filter and reference source for African investment specialists across various asset classes. One more point, I was wrong, I need to make another one. The Contents are not to be construed as a recommendation or an offer or invitation to trade any securities or collective investment schemes nor should any Contents form the basis of, or be relied upon in connection with, any contract or commitment on the part of any person to proceed with any transaction. “Most of the private debt deals done in Africa are sponsorless, and so this is complementary to their portfolios. returns for their investors, but also contribute to Africa’s ongoing economic transformation. If you are unsure about the meaning of any information provided, please consult your financial or other professional adviser. As prices for stakes in large African companies rise, it will become more difficult for private equity funds to deliver high returns. The information contained on the LifePath Paycheck website is intended for the following audiences in the U.S. only: Eligible collective investment fund investors who are: (1) U.S. retirement, pension, profit-sharing or stock bonus plans that are qualified under Internal Revenue Code (“IRC”) Section 401(a) and tax-exempt under IRC Section 501(a); or (2) U.S. The stage is set for a new, more efficient approach to private equity investing. 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We are built to share our advantages with clients— and steadfast in our commitment to provide efficient exposure to private equity in formats tailored to their needs. The Website has not made, and expressly disclaims, any representations with respect to any forward-looking statements. And again, it depends, I think, about the size of your portfolio investments relative to individual assets. Why we’re likely to see a significant increase in private equity secondary market transactions in the months ahead. Here are the deals and discounts our team is seeing. It is your responsibility to be aware of, to obtain all relevant regulatory approvals, licenses, verifications and/or registrations under, and to observe all applicable laws and regulations of any relevant jurisdiction in connection with your entrant to this Website. 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We look forward to leveraging Russ' experience and sharing his perspectives on a variety of PE related topics. We explore the historical evolution and outperformance of private equity over the last four decades and the outlook for the next decade. The report tracks the performance of a representative grouping of South African private equity funds. Our sourcing machine, comprised of networks in public and private markets and a brand that has enabled proprietary access, is core to our ability to generate alpha. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. Our approaches span the private equity toolkit, offering investors exposure to private equity through direct, primary, secondary, and co-investment strategies. Secondary market exposure is now viewed as a permanent component of private market allocation by many institutional investors. Our next episode will be focused on the impact of technology, specifically the increasing use of big data in the private markets. The Contents do not purport to be complete and is subject to change. And depending upon the risk return that an individual organization through their private equity portfolio is looking for in the marketplace. Despite erratic fundraising and mixed risk and growth outlooks, deal activity in African private equity is growing. Interestingly, our most recent global LP survey, The search for returns: Investor views on Private Equity in Africa, showed that regional funds are the preferred route to accessing African private equity in the near-term, and that fund of funds are the preferred route of first-time investors in Africa. ECP Investments in Africa Emerging Capital Partners (ECP) is a private equity firm that has invested in Africa for the past two decades. SuperReturn Africa will be joining SuperReturn Emerging Markets to form SuperReturn Asia Growth Markets Virtual. The strategy is predicated on asset selection that prioritizes proven, high-quality businesses and value creation through active collaboration with management teams. And so I think at the end of the day, very size dependent. The performance of a private equity strategy may be substantially adversely affected by a single investment. All in all, typical of private equity, it's changing and evolving every day. The discussion from anecdotal evidence and information in the case that the more co investments you add to a portfolio, and maybe even the more GP led secondaries you add to the portfolio, you can lower your coefficient or your beta to the public markets. Contact us to discuss how we can help your organization. 130+ LPs. © 2021 BlackRock, Inc. All rights reserved. Let's listen in. Is Africa the world’s most under-rated investment destination? We reserve the right to change, modify, add, or delete, any content and the terms of use of this Website without notice. A market-leading analytics platform provides an edge with exceptional visibility across asset classes, and deep views across companies, industries and macro trends. There is still a high level of investor readiness, yet this is complemented with a level of caution, as PE players target Last year, Portia Dhlamini of Native Nylon was chosen as the first recipient of … Use Shift+Tab keys to browse. The African Private Equity and Venture Capital Association – (Avca), the industry’s main trade association, says the returns are better if you only look at exited investments. You can download a copy of the evolution of private equity white paper on the BlackRock website. And that's what makes it so exciting. We will have to see how that turns out in practice, and we'll have to see, Jeroen, how the academics are able to see if they can give us some help on this particular one. And now with the advent of the development of the secondary market, which started really in the late 80s and early 90s and pretty much a one-off way to now being very sophisticated relative to pools of private equity partnerships, as well as what's known as GP-led secondaries, which is something that's developing very very fast so again, this impacts private equity and impacts the way you think about your construction of your portfolios. Investors buy shares in PE funds on the secondary market to access more mature assets, diversify their portfolios and capitalize on market dislocations. Julia also helps break down Private Equity return drivers and how. While the approaches differ, they share the strengths of a common platform as they seek to deliver top quartile performance across investment cycles. And when you talk about geography, back then it was also pretty simple. Our platform takes a holistic approach to investors’ private equity portfolios and is designed to offer strategies and solutions that align with client objectives and deliver persistent outperformance. Russell Steenberg, Managing Director and Global Head of BlackRock PEP oversees investments across primary funds, co-investments and secondaries. To date Khula Lula has made nine public equity investments and one private equity investment. However, portfolio construction also adds a significant amount of alpha. It is your responsibility to be aware of and to observe all applicable laws and regulations of any relevant jurisdiction. Data indicates that investments into private equity funds delivered an annualised rate of return of 18.5 percent, net of fees, over the ten years to September 2014. The report, which tracks a representative […] As a global investment manager and fiduciary to our clients, our purpose at BlackRock is to help everyone experience financial well-being. Agree that all access to this website by you will be subject to the disclaimer, risk warnings and other information set out herein; and. This material may contain “forward-looking” information that is not purely historical in nature. Now it's not only primaries, with all the different diversification criteria to the primaries that we were talking about, but it's also co investing across all of those diversification criteria. See the people, deals, and events shaping Africa’s investment landscape. Any changes to assumptions that may have been made in preparing this material could have a material impact on the investment returns that are presented herein. Governmental 457(b) plans. For today's episode, alongside Russ, we have my colleague, Dr. Jeroen Cornell, private equity product strategist, focused on quantitative solutions and author of our most recent white paper titled “The evolution of private equity.” He'll be chatting with Russ to reflect on the progression of PE portfolio construction over the past four decades, its impact on performance, and how many investments are too many. Could the continent offer better returns on cheaper capital? This finding comes at the same time the organisation released a report which found that the country’s venture capital industry is worth nearly R2-billion — the highest ever recorded.. This Website is not intended for and should not be accessed by persons located or resident in any jurisdiction where (by reason of that person's nationality, domicile, residence or otherwise) the publication or availability of this Website is prohibited or contrary to local law or regulation or would subject any BlackRock entity to any registration or licensing requirements in such jurisdiction. Our leading PE investors provide perspective on the market climate and share what it takes to create persistent alpha. Having invested across multiple cycles, they are well equipped to help clients build resilient PE portfolios. The share of deals involving private equity in … We lay out differences between diversified private equity programs investing in primaries, secondaries and co-investments. It is absolutely crucial to alpha, no doubt. We're excited to kick off a series of short candid conversations with our founder and Global Head of Private Equity Partners, Russ Steenberg. This is consistent for the ALSI, FINDI and SWIX benchmarks. African Private Equity (PE) markets have grown exponentially in recent years and, going by the results of the 2016 After meeting its financial target, the private equity firm then closes the fund to new investors. So trading away more diversification for less return because more diversification is only going to drive your alpha to the mean is probably not a good trade off. This Website or information contained or incorporated by reference has not been, and will not be submitted to, become approved/verified by, or registered with, any relevant government authorities under the local laws. You will learn the common investor challenges and the solutions to mitigate those barriers. More articles loaded. We have been leaders in co-investments since 2001. This is according to Bright Africa 2020, a research initiative by purpose-driven global investment firm, RisCura. Source: BlackRock, as of December 31, 2020. It is included in almost every asset class that exists within institutional portfolios, and certainly now, even within individuals portfolios. These risks include, but are not limited to, the following: private equity investments are speculative and involve a high degree of risk; an investor could lose all or a substantial amount of his or her investment; interests in private equity investments are illiquid and there is no secondary market nor is one expected to develop for interests in such investments; there are significant restrictions on transferring private equity investments; private equity investments experience volatile performance; private equity vehicles are often concentrated and lack diversification and regulatory oversight; private equity vehicles have high fees and expenses (including “carried interest”) that will reduce such investments’ returns and a private equity investment or a vehicle may invest in other vehicles which themselves charge management fees and carried interest; a private equity investor has an ongoing financial commitment to make contributions to such vehicles, is subject to severe consequences in cases of default and may have to recontribute distributions to private equity investments; and can be subject to various conflicts of interest arising from the fact that many private equity sponsors, are global financial services firms which provide a broad array of financial services and are, in some cases, related to other large financial services firms. 37 funds Aross 294 comc PAnies APProveD invesTmenTs in Private Equity Brochure_Fifth Draft.indd 2 14/05/2012 17:38 Well, if you look through these partnerships. Since 1999, we've been a leading provider of financial technology, and our clients turn to us for the solutions they need when planning for their most important goals. And indeed, private equity is not an alternative investment anymore it's a mainline investment. Private Equity Firms in South Africa – Services Offered. BlackRock has been a major contributor to this evolution, from our role as an early mover in co-investments to our early adoption of ESG policies to our introduction of an innovative, client-aligned direct strategy. No representation is made that any performance presented will be achieved by any BlackRock Funds, or that every assumption made in achieving, calculating or presenting either the forward-looking information or any historical performance information herein has been considered or stated in preparing this material. South African private equity returns continue to grow, according to a report released by South African Venture Capital and Private Equity Association (SAVCA). Learn more. Paragraph-4,Image Cta-2,Image Cta-3,Image Cta-4,Image Cta-5, Paragraph-8,Image Cta-6,Paragraph-9,Dynamic Article List-2. 2018 Deloitte Africa Private Equity Confidence Survey 01 Foreword There is cautious optimism as private equity continues to be an agile asset class, navigating tough geopolitical and macro-economic conditions across Africa. Once you have confirmed that you agree to the legal information in this document, and the Privacy Policy – by indicating your consent above – we will place a cookie on your computer to recognise you and prevent this page reappearing should you access this site, or other BlackRock sites, on future occasions. The Bank believes that the asset class is an effective way to strengthen Africa’s economies, create jobs and drive development. Our private equity investors have extensive experience and strong records of achievement in the industry. Private credit allows for stable cashflows and faster liquidity than private equity and there is a case to be made that the returns are not highly correlated with other investments, including private equity.” According to its website, Khula Lula specialises in both angel investment and public equity investing. Your #1 must-have investment tool. Julia helps to separate fact from fiction as it relates to common PE beliefs. Please note that you are required to read and accept the terms of our Privacy Policy before you are able to access our websites. International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation, and the possibility of substantial volatility due to adverse political, economic or other developments. Over the past decade, African private equity (PE) has emerged as an attractive asset class, underpinned by favourable fundamental trends. Ethos Private Equity is an investment manager with private equity and credit strategies in sub-Saharan Africa. References to specific securities, asset classes and financial markets are for illustrative purposes only and are not intended to be and should not be interpreted as recommendations. And back then your choices were far less abundant than they are today. In the U.S., this material is for Institutional use only – not for public distribution. No WarrantyThe Contents are published in good faith but no advice, representation or warranty, express or implied, is made by BlackRock or by any person as to its adequacy, accuracy, completeness, reasonableness or that it is fit for your particular purpose, and it should not be relied on as such.