Why Work for Co-Invest Fund?

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?

Comments (9)

Mar 31, 2016

The upside of doing deals based on a full set of information that someone else has to build.

Jul 12, 2016

Any other thoughts guys?

Jul 13, 2016

Are they also LPs?

Jul 13, 2016

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.

Jul 15, 2016

How about MBAs and also career path after doing Co -Invest? Are opps much more limited than at a direct fund?

Jul 25, 2016

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?

Jul 25, 2016

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.

Sep 7, 2016

What do you mean with CI fund? Not familiar with that term.

Array
Sep 8, 2016
Comment