Political shots fired: Sen. Warren backed bill would fundamentally change PE, Building a firm on friendship
Hope your week went well. It’s feeling a bit slow on the news side, at least for deals. On the fundraising front, it really doesn’t feel like the action has slowed down yet. Spinouts, emerging managers and product extensions are all keeping LPs busy, even though we’re entering the dog days, according to an LP I spoke with this week.
Product extensions is an especially interesting area and one where I get mixed reviews — there seem to be certain situations that LPs really like, when a GP has prepared for years to launch into a new strategy. Then, there are other situations where a new strategy crops up almost over night that don’t seem to be as attractive.
Friends: I wrote this week about LA-based Butterfly Equity closing its debut fund. The two founders, from Vista and KKR, have been best friends since they came up together at Goldman Sachs. This bond is something the co-founders saw as an advantage when approaching potential LPs. Strength of partnership is a vital aspect of any private equity business.
While we saw the birth of one partnership this week, we saw the winding down of another one. Lariat Partners, formed in 2013 by executives from KRG and RedCloud, has decided to wind down. One of the founders, Jay Coughlon, recently announced his new shop, Fruition Partners, an independent sponsor formed with some other Lariat executives.
Have you seen other examples of birth/death cycle in private equity? Hit me up email@example.com.
Look out: Don’t look now, but politicians are making private equity a political football as the U.S. moves into a presidential election year in 2020.