Private Equity’s ‘Solution Capital’ — Conversation with Nate Sleeper of Clayton, Dubilier & Rice

July 17, 2017

Private equity, of course, is a core part of most large institutional investors’ portfolios. How core?

As of last year, some 90% of large U.S. public pension funds maintained allocations to private equity – an investment amount that totalled nearly 10% of all U.S. pension assets. In fact, for some global endowments, public pension systems and sovereign wealth funds around the world, the dollar-weighted average proportion of total AUM invested in private equity had increased from 6% to 12% in just the previous two years.

But while private equity continues to grow as an asset class, many LPs seek new strategies, moving beyond the traditional fund investments, including co-investments, co-sponsorships, and even direct investments – bypassing the PE firms completely.

Within this evolution of investment opportunities, a new approach has quietly been gaining traction. It’s called Solution Capital — highly customised transactions tailored for sellers who want to keep a substantial minority interest in the business being sold.

How does Solution Capital work? Why would a seller consider this route? What’s its probability for success?

Nate Sleeper is a Partner at Clayton, Dubilier & Rice. He has led or participated in dozens of these investments across a range of sectors.

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E-Commerce Innovation with Liza Landsman, Jet Chief Customer Officer

July 14, 2017

As we approach the depths of the Christmas buying season, today we head straight to the core of holiday spirit: e-commerce and online shopping.

Chances are, if you’re shopping this season – or, really, any day of the year – you do some, if not all of it, online. Few industries are bigger than e-commerce, with online sales expected to break $400 billion within three years.

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Strategic Conversations: ‘The Biology of Corporate Survival’

July 14, 2017

A recent Harvard Business Review piece by Martin Reeves and Simon Levin laid out the case. It’s titled “The Biology of Corporate Survival.” Numbers explain why it matters:

After reviewing the histories of more than 30,000 U.S. public firms over 50 years, the authors found that “Businesses are disappearing faster than ever before.”

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Economics of Successful Partnerships: Josh Lerner

July 14, 2017

The premise behind any business partnership seems obvious: Build a structure and set of rules around performance and profits that not only create agreed upon fairness, but more importantly, position the partnership for long-term success.

 

 

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