Hey everyone! Just trying to better understand some of the characteristics of PE firms.
From the networking and research I've done, it seems like every firm is quick to point out their unique ability to form "partnerships" with management teams in order to drive significant value creation. What I want to know is, what funds are truly known for their ability to make operational change in a company to drive returns.
Not saying there's anything wrong with the firms that place more focus on financial engineering, but personally I think I'd be more interested in working with management teams as opposed to optimizing financing.
PE funds that hire a lot of consultants like Bain Cap come to mind. Also some funds have portco ops teams like KKR Capstone that do consulting work for their portfolio companies
I don't know too much about PE, but it sounds like VC might be more of a good fit for you.
Why do you say that?
VC firms vary, but when I think of the industry, I think of firms that are trying to find the diamond in the rough in the start-up world. Most start-ups are just failures in the making, some will be decently successful, and a small amount will be very successful. VC firms have to sift through all of these start-ups and find good ones. Unlike the companies that PE firms look at, VCs looking at tiny start-ups don't necessarily have access to reliable financial data from the founders because the companies are often very new. Again, this varies depending on the VC firm and the type of start-up, but when I think of VC firms, I think of firms that aren't investing on the basis of numbers (obviously not true, they definitely still look at numbers), but firms that are investing on the basis of the idea and the quality of the management. That seems to be more of what you're looking for.
KPS comes to mind
I've been hearing this name a lot recently. Could you share what you know about them?
Vista has VCG (Vista consulting group)
Many of the value guys are by nature operationally-oriented. Examples would be Platinum, Wynnchurch, Cerberus, H.I.G., Monomoy, Aterian.
The broader question I would think is... does the fund have separate deal and operations teams? If you specialize in IB, you may be stuck working on deals and far less on operations (though you can work with management teams on add-on acquisitions). I would imagine that the further you move down, the more exposure you get to portfolio management and dealing with operational and strategic issues because the roles and responsibilities are less siloed and often you wear both hats.
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