I have an interview coming up with a co-investment fund. What is the best way to answer the "why do you want to work for us" question?
I was thinking about saying something along the lines of co-investment model gives associates the chance to really learn about a company, build detailed financial models, etc. while piggybacking off the main Sponsors work. Don't necessarily have to do all the diligence yourself (which can take a painstaking amount of time).
Thoughts / comments?
The upside of doing deals based on a full set of information that someone else has to build.
Any other thoughts guys?
Are they also LPs?
Some others: deals will be hand-picked and shown to you so less emphasis on sourcing and more on investment work, not paying or paying reduced fees/carry vs. traditional FoF investing.
How about MBAs and also career path after doing Co -Invest? Are opps much more limited than at a direct fund?
I do not understand how co-investment exclusive funds exist could exist in this market environment. Why do they think they can have someone mix, bake, and frost the cake and still have a huge slice to themselves. I would think it would be a difficult model to sustain...Maybe I am mistaken. What are some co-invest only funds?
I don't know many places that are dedicated, standalone co-invest shops but most (all?) of the big FoFs will have a dedicated co-invest vehicle. Relationships via primary fund commitments help to drive the CI opportunities: show your big anchor LP FoF a few deals you cherry picked as winners and they'll be very happy with you the next time fundraising roles around.
Other reasons could be 1) say you're a shop that writes an average equity check of 25-35mm and the next time you fundraise you want to raise a materially larger fund, such that given the same amount of deals, you want to target 45-65mm equity checks. If you source those deals that size now and write your standard 25-35mm check and allocate the rest to co-investors, you're building a track record of larger deals without going outside of your current fund parameters and pissing off your LPs.
2) Similarly for portfolio construction purposes, if you fund a really good deal but that much equity invested as a % of capital deployed overweights your exposure to one sector, you might commit less fund equity and allocate the rest to co-investors.
The more I think about it the more working for a CI fund sounds like pretty sweet gig. Obviously though there are downsides.
What do you mean with CI fund? Not familiar with that term.
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