UK - Hartley leaves August Equity

“It is time for a change,” he said, speaking exclusively with unquote”. And change should be good: Hartley has spent more than three quarters of his 27-year career in private equity, cutting his teeth at 3i before joining Kleinwort, which eventually became August. “I had always felt I would enjoy being a big fish in a small pond, but now I am looking for fresh water.” He is fast to point out that the August portfolio is performing well and the team a strong one – indeed while others lick their fresh wounds, August closed a £37m secondary BIMBO when it bought Accura from Barclays Ventures just a few weeks ago.

Hartley’s next move is not yet set in stone. “I have a number of ideas I would like to explore with people I’ve met over the years. Public companies in particular interest me: a lack of confidence and lack of leverage make for a lot of opportunity to use private equity techniques to perform transformational management change with these targets.”

He further adds his scepticism to the current funding model for private equity. “The traditional 10-year, 2 and 20 limited partnership is viable, but I no longer believe it is the only way of using capital and the skillsets of private equity professionals. We should be looking to more flexible ways and, as people do, this model will be challenged. There has been a lot of inertia between GPs and LPs over the last 12-15 years: strong performance has attracted investors and they’ve come to expect returns of at least 15-20%. But that is not always sustainable and especially not in a downturn. So are investors getting value with this model? Not necessarily. Long term commitments may no longer be the best way forward.”

So where is the best spot for private equity right now? “In a large buyout house where the cheques roll in every quarter and dealflow is slow; the best spot is on the golf course.” Hartley now looks forward to some time off and is in good spirits as well as good shape: he ran a half marathon last weekend and is ‘full of beans’. When asked whether we’d see him reappearing on the private equity scene within 12 months, he replied confidently: “Whether doing something similar with different people or something for myself, I’ll be back.”

August made the following statement: “August Equity LLP announces that managing partner Andrew Hartley has resigned from the firm to pursue fresh challenges and new business interests. Andrew was one of the founding members of the firm and contributed significantly to its success and development, and we wish him well in his future career.”

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