Starting a PE fund
In a totally fabricated world...
Say you did 2 years IB, 4 years in an UMM PE firm.
How easy would it be to raise capital. Say even 5-10mil?
And how would you do it? - Would you speak to small family offices for tiny tickets?
Would sourcing a deal, pre-arranging debt and then asking for co-invests and other small PE firms to join be your best bet?
Or would you go about it another way?
Bumparino*
Deal by deal / search fund
do a few deals then go out residing more money.
I’m a Senior Associate at a mid cap fund that’s had pretty good returns, I’ve chatted to a few family offices just out of curiosity, asking questions like “where would I need to be in a few years for you to back me” and the consensus I got was that small spin outs are backed because of their specialisation. You need to be the expert on something very niche, the example I was given was Polish building materials. If you can do that then as a VP my understanding is that you can get a decent amount of cash with the understanding that if you do well they will give you more. This will be a very long route to building your own shop but if you’re the kind of person who hates working for other people it’s not a bad track.
The alternative route of spinning out at the MD level and doing a huge raise is probably more lucrative in the long run but is obviously a bit of a grind.
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