As a surprisingly high number of newcomers reach successful fund closes despite continued turbulence in the fundraising market, Warren Hibbert of Asante Capital explains how maiden vehicles are finding success where many well-established players are falling by the wayside.
According to Hibbert, founding and managing partner of placement agent Asante, to explain the speed in which first-time funds are raising when compared to long-standing brand names, the fundraising market must be looked at from a broader context. "There's no automatic fundraising. And the market is bifurcated; there are smaller managers with high performance who are raising very quickly, and at the larger end of the market the bigger players who are raising at target or above target but are taking a lot longer."
Hibbert believes the pace at which the two types of funds are raising capital is a case of how much planning and thought has gone into the fundraising process.
"Then there are the funds in between these two groups, which some might label as zombie funds. Those funds without any differentiation that are struggling to stand out from the crowd, or those that are doing something completely different and haven't been able to find the right LPs to back them." Hibbert goes on to say that some of these funds might manage to raise somewhere close to their target, or not at all.
Hibbert emphasises that the common factor in whether the small, large or middle-of-the-road funds raise at all, is in their ability to reach a first close. "A first close effectively means you're in business; that you have enough cash to put together some form of diversified portfolio."
Hibbert also discuss the types of investors that are willing to back first-time funds and the main challenges impacting the fundraising market today.
Your comment will be moderated before publication.
The German subsidiary of Unicredit has sold part of its private equity portfolio to newly founded SwanCap Investment Management.
06 Dec 2013 |
More from unquote
Updating your subscription status
Apax Partners has appointed Mitch Truwit and Andrew Sillitoe as new CEOs, taking over from current CEO Martin Halusa.
French buy-and-build specialist Industries & Finances has hired Nicolas Degrassat as associate.
Triton Partners has hired Graeme Ardus as the new head of its environment, social responsibility and governance (ESG) operations....
Altius Associates has appointed former Pinebridge managing director Rhonda Ryan as partner and head of EMEA investments.
Gilde Equity Management Benelux has hired Thijs van Remmen, formerly of KKR, as an investment director.