Inside Private Equity The Professional Investor's Handbook

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Edition: 1st
Format: Hardcover
Pub. Date: 2009-04-20
Publisher(s): Wiley
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Summary

"This handbook is essential reading for all investors in the private markets. It is especially helpful in understanding the mechanics of portfolio construction and challenges of performance measurement of private equity and venture capital investing." -Susan J. Carter, President and CEO, Commonfund Capital, Inc."An invaluable handbook." -Sir Ronald Cohen, Chairman of The Portland Trust, Portland Capital LLP, and Bridges Ventures"Private equity fund investing is often viewed as more art than science, though in reality it requires an even blend of both skills. This book focuses on the science behind the art. It covers all the major concepts while introducing some great new ones, and must be required reading for serious private equity market participants." -Chihtsung Lam, founder and Managing Director of Axiom Asia Private Capital"The authors have created a simple and pragmatic handbook for a very complex asset class. Their collective experience is invaluable. This is a fantastic read for new private equity investors as well as experienced portfolio managers looking for additional tools that can be used in monitoring their current investments and in the process of screening new opportunities. Inside Private Equity is a great foundation for investors looking to improve their analysis of an exciting asset class." -Timothy B. Moore, Director of Alternative Investments, PERA of Colorado"A real practitioner-focused contribution bringing performance measurement down from the theoretical to the practical." -Jesse E. Reyes, Reyes Analytics"Inside Private Equity clearly explains, without oversimplifying, the hard work of managing private equity portfolios. Full of cogent advice from an experienced team. Great work!" -Lawrence M. Unrein, Managing Director and Head of the Private Equity Group for J.P. Morgan Asset Management"A handy guide to address the pitfalls and issues of investing in private equity that most institutional investors have wrongly ignored. Well done!" -Dory Wiley, President and CEO of Commerce Street Capital and Trustee and Chairman of the Investment Committee at Teachers Retirement System of Texas

Author Biography

JAMES M. KOCIS is the founder and President of the Burgiss Group, one of the leading software and financial service providers to the private equity industry. He and his team designed Private i, the world's most popular program for private equity portfolio management. Private i is used to manage in excess of $1 trillion of private equity investments.

JAMES C. BACHMAN IV, CAIA, is the Head of Research at the Burgiss Group. In this role, he is principally responsible for research-related initiatives as well as expanding the technology platform's portfolio management capabilities.

AUSTIN M. LONG III, JD, CPA, is the Head of Alignment Capital, a private equity consultancy. He has been active in the private markets since 1987, when he cofounded what was to become the University of Texas Investment Management Company (UTIMCO) private investment group.

CRAIG J. NICKELS, CFA, is the Director of Private Markets for Washington University in St. Louis, where his responsibilities include the oversight and management of the university's private market investments within the multi-billion endowment.

Table of Contents

Forewordp. xi
Prefacep. xvii
Acknowledgmentsp. xxi
How to Use This Bookp. xxiii
About the Authorsp. xxv
Setting the Foundation
Backgroundp. 3
Private Equity Perspectivesp. 13
Managing the Investment Processp. 29
Capturing a Portfoliop. 51
Tracking Portfolio Holdingsp. 63
Measurements and Comparisons
Standard Measuresp. 79
The IRRp. 89
Universe Comparisonsp. 111
Flawed Research Methodologiesp. 129
Visualizing Private Equity Performancep. 137
The IRR and the Public Marketsp. 153
Topics on Risk
Performance Attributionp. 165
The Concentration of Wealthp. 175
The Diversification of Portfoliosp. 185
Cash Management Modelsp. 193
Conclusions
The Private Equity Professionalp. 211
Summaryp. 217
Proposed Venture Capital Portfolio Valuation Guidelinesp. 221
On-Site GP Audit Program Guidep. 223
Qualitative Due Diligence: Structured Interviewp. 225
Qualitative Due Diligence: Structured Reference Callsp. 229
Request for Information (RFI)p. 231
Advanced Topics: Duration of Performancep. 235
Advanced Topics: Correlation and Opportunity Costsp. 239
Patent Summariesp. 249
Referencesp. 253
Indexp. 257
Table of Contents provided by Ingram. All Rights Reserved.

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