SoftBank Vision Fund / GIC / Temasek

Answering each of your questions:

Overall strategy:

One interesting fact is that since their direct investment activities are a result of a horizontal move (they have been co-investors for so long alongside all the GPs they have been fund investors in) rather than their initial focus, the SWFs in particular tend to have a better matrix of strategy and stage than the megafunds do.

For example, in the past decade KKR alone has added dedicated vehicles for technology growth equity (2016), healthcare growth equity (2017), tactical real estate credit (2017), domestic real estate private equity (2013), European real estate private equity (2016), infrastructure (2013), and special situations (2014).

I probably forgot some, my memory isn't perfect. Almost half of those I listed are successfully on to a Fund II or III.

The point I'm making is that megafunds are dramatically expanding their footprint to offer specialized funds. However, the more sophisticated SWFs (CPP, OTPP, Temasek, etc.) have already had dedicated teams in place around these strategies in order to be adequately reactive when those GPs would walk in and say "Hey, want to co-invest in an individual deal?"

Amusingly, the reason GPs had to go seek external capital was because they didn't have the firepower to take down all the deals they were able to source that may have been slightly off-center for a flagship buyout or credit fund .... which was the very prompt for the proliferation of such specialized vehicles. It's an interconnected phenomenon.

Overall, the strategy is always first and foremost to make money, followed usually by an intent to diversify away from the state's economy. Norway, for instance (the world's largest SWF) wants exposure to non-energy assets. Same thing for all the Middle Eastern guys (ADIA, Mubadala, QIA, etc.).

Beyond that, it's largely the whim of whoever runs the firm. Some are run by political appointees. Fewer are run by an external, non-affiliated hire who is chosen in a standard competitive search process.

Investment performance:

The sovereigns are roughly comparable to the megafunds in the return targets they set, although there are two main differences.

(a) They have a different investment horizon. Since they don't have external investors, they can be the ultimate patient capital. Deals aren't underwritten on a 4-year duration like they are at megafunds, it's often done with a longer hold period in mind.

(I know of one SWF that is really sophisticated and is thoughtful about how this duration component allows them more time to implement operational changes and thus incorporates a lens to examine which businesses require more capital than a sponsor may want to invest in a portfolio company but offer equally larger revenue growth from a successful transformation.)

(b) Their gross return is private equity's net return. They can go after deals that sponsors shy away from because they don't have a 20% performance fee impacting their returns. Whatever gains their investments generate show up on the bottom line (minus incentives paid to investment staff, obviously).

Softbank is a different beast because it has LPs itself. (I believe Michael Ronen from Goldman is the Managing Partner, although I don't know if that's a title given to multiple people or if it's what they call him as CIO.)

I believe its entire focus is on growth investments though, so the return profile they sold LPs on was higher than traditional buyout, although they have a convoluted capital base in that vehicle. Rather than traditional fund commitments, half the people are on some kind of preferred-esque unit that offers a coupon ... and some people are on a debt instrument rather than an equity basis in the vehicle. The whole thing is Frankenstein-y.

Career development:

They are not poorly regarded names. If you go to a sovereign out of an analyst program, you simply need to diligence whether they push you out for business school or not.

If they do, you can consider it roughly analogous to a megafund. A b-school adcom is going to know the name and look for resume items that show the same sort of stuff they look for from a private equity applicant: deal execution, a habit of leadership, and a continued expansion of responsibility.

If they don't, you have to figure out what the long-term compensation potential is. It's not a GP, so you can't get carry in the fund the same way you would at a sponsor; you may be offered phantom equity, or you may find that it's simply a discretionary bonus much like you find in the hedge fund world.

You also have to figure out the promotion trajectory. The longer-duration mindset I mentioned previously tends to also apply here; your title growth may not be as predictable as it is in the sponsor universe.

///

My direct experience with them on deals of various sizes has been that there's no one-size-fits-all answer.

One of them moved fairly quickly and was responsive on a process. The majority seemed to not fit that, they were slower or unwieldy in a way I didn't find enjoyable.

I do know that you don't have to speak the native language of whatever country the SWF represents, even if your offer is in the domestic office of that country. I know continental guys for whom English is a second or third (but fully fluent) language who have taken offers in Abu Dhabi, Dubai, Doha, and Seoul. I know Americans who staff the New York or West Coast offices of GIC and Temasek who are cornbread/plain Jane U.S. citizens.