PE HUB Wire Highlights, 10.17.19


Photo of Luisa Beltran, PE HUB Senior Editor, courtesy of Buyouts Insider.

Parthenon comes to market with its sixth flagship fund; MLB said to allow funds to take minority stakes; Pritzker’s Carbone dislikes “patient capital”

Big news this morning as there’s a Brexit deal. Britain and the EU have agreed to a draft text of a Brexit deal, which must still clear several hurdles, the New York Times reported this morning.

In other important news, Major League Baseball is now allowing investment funds to take minority stakes in multiple clubs, which could open the door to Wall Street firms and college endowments to invest, Bloomberg is reporting. The NBA is mulling a similar approach, the story said.

I’m not sure how I feel about this, Hubsters, especially if this means a PE firm, or firms, can invest in my beloved Cubbies. Will snacks and tickets at the stadium get more expensive? What positives or negatives would this bring? Email me your thoughts at lbeltran@buyoutsinsider.com

There’s lots of benefits to dealing with a family office. One of the biggest reasons to consider a family office is that it’s considered permanent capital. Unlike private equity, which operates on a timeline, family office funding can last generations. Family offices can operate with more speed and flexibility than traditional investment firms, according to Greg Barasiawho has written a guide to FOs.

But these investors come with their own challenges, Barasia said. Depending on the level of sophistication of the family office, the FO may appear disorganized. “In my experience, family offices are generally leaner in terms of staff, and given the potentially changing demands of the principal, sometimes it seems as though they are running in many different directions at once,” Barasia said.

Family offices may also lose interest in a deal, especially if it’s a “cocktail party” investment, Barasia said. This refers to transactions that a principal makes “specifically to discuss with friends at social gatherings,” Barasia said. Family offices are also known for dragging out their investment process to create as much optionality as possible, he said. It can also be tough dealing with FOs since these individuals are used to getting their way. It can be very difficult to arrange favorable terms, Barasia said.

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