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PE HUB Wire Highlights, 8.14.19

Summit Partners said to invest in Florida’s Pediatric Associates; Castle Harlan, Branford buy Sunless; Do GPs with more skin in the game become more cautious investors?

Private equity firms become less risky investors if more of their own money is on the line.

That’s according to a story from Institutional Investor, which cited a study from the Norwegian School of Economics and Goethe University Frankfurt. The study focused its research on 120 PE professionals in Norway, because tax returns in that country are public and make it possible to collect data on managers’ taxable wealth, II said.

The study found that the higher a GP’s fund stake was relative to their personal net worth was linked to lower equity beta in portfolio companies and more diversified portfolios, Institutional Investor said.

The result is that relatively poor execs are more risk averse than wealthy ones, the story said.

This seems very logical to me. I do wonder if the study’s focus on just execs from Norway may produce different results.

Hubsters, any thoughts? Do you agree that GPs who invest more of their personal wealth in funds become more risk averse? Does the focus on just Norway GPs skew the results? Email me at

One of the funniest interviews I’ve had occurred yesterday when I spoke to John S. Castle.

Castle, who is the president and CEO Branford Castle, spoke to me at length about spray tans. Users of spray tans don’t have to fear turning orange, he said. “If done right, the spray tan is better than a natural look,” said Castle. “It’s even, it’s beautiful. It’s a great look.”

His comments come as Castle Harlan and Branford clinched their buy yesterday of Sunless Inc from Riverside Co. (Castle Harlan is the New York PE firm that is in between funds. Branford Castle is the former family office that is now a private equity firm.) Read my story here.

Correction: A prior version of this story said that John Castle is the president and CEO of Castle Harlan. That is incorrect. John S Castle is president and CEO of Branford Castle. John K. Castle, his father, is chairman and CEO of Castle Harlan and chairman of Branford Castle. The story has been changed.