Inside Private Equity : The Professional Investor's Handbook

by James M. Kocis; James C. Bachman; Austin M. Long; Craig J. Nickels

• ISBN13: 9780470471081
• ISBN10: 0470471085
• Format: eBook
• Copyright: 2009-03-01
• Publisher: Wiley

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

Table of Contents

Foreword

Preface

Acknowledgments

How to Use This Book

About the Authors

Setting the Foundation

Background

Private Equity Perspectives

Managing the Investment Process

Capturing a Portfolio

Tracking Portfolio Holdings

Measurements and Comparisons

Standard Measures

The IRR

Universe Comparisons

Flawed Research Methodologies

Visualizing Private Equity Performance

The IRR and the Public Markets

Topics on Risk

Performance Attribution

The Concentration of Wealth

The Diversification of Portfolios

Cash Management Models

Conclusions

The Private Equity Professional

Summary

Proposed Venture Capital Portfolio Valuation Guidelines

On-Site GP Audit Program Guide

Qualitative Due Diligence: Structured Interview

Qualitative Due Diligence: Structured Reference Calls

Request for Information (RFI)

Advanced Topics: Duration of Performance

Advanced Topics: Correlation and Opportunity Costs

Patent Summaries

References

Index

Table of Contents provided by Publisher. All Rights Reserved.