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Clearlake and Marlin come to mind
Oaktree as well
How come?
I'm saying this from the outside in as I work in the syndicated loan market, but for Clearlake at least they fundraised in 2020 and then redirected all that money to sectors with a lot of lofty valuations. Those investments largely haven't performed and the valuations have come down- it takes two minutes on a terminal to see that a lot of their portcos have debt trading below 80. Also a double whammy they bought a CLO platform which took down large slugs of their term loans for these companies.
Not a direct answer to your question, but it does feel like this topic is usually way overdramatized on this site. Absent some severe organizational decay the pool of capital out there is generally large enough & growing. The tech funds that way overrotated in 2021 (Insight, Silver Lake) will have a tough vintage but LPs know the long-term tech opportunity remains compelling. Similar story to the megacaps that had difficult 08s (TPG, Bain, Warburg, etc) who have minted strong enough track records since. The cases of true “funds going downhill” you usually know when you see (key man departures, not raising for 5+ years, not actively deploying, etc.)
Yeah this is the right approach to this question. When people on here call out Warburg/Bain for going downhill, I just laugh. Those firms aren’t struggling, quite the opposite.
Agree with that one of the best indications a firm is struggling is leadership leaving. Look for that. Partners in a firm obviously have the best perspective on what’s actually going on. Interns on WSO saying that a firm with a 30 year track record of success is going downhill because consecutive funds were the same size sound so stupid.
Bain is undeniably a much less desirable firm to be at than 10-15 years ago. That’s the definition of going downhill. And it’ll continue on that path
Golden Gate
Why?
Please expand
Completely unsure on this, but I’ve heard negative things about Whitehorse, Instar and Onex (which I was surprised of). Anyone care to provide additional colour. Once again I’ve never worked at any of these places, just have heard from the grapevine so someone please correct me
Reasons for negative takes:
Whitehorse: returns have been poor
Instar: struggling to get deals
Onex: lacking the investor talent they once had
Whitehorse (Dawson) massively on the rise AUM/fund size wise
Whitehorse/Dawson is a marketing machine but not a place you go to if you're a serious investor and want decent returns. Culturally they're one of the worst out there and have brushed under the rug serious issues like allegations of sexual harassment, which naturally lead to one partner joining a no name competitor.
Agree on Onex.
OMERS also I feel has had some poor investments.
Please expand on OMERS
Example - Mapleleaf Pipeline
Agreed on all points. Onex in particular has done terrible succession planning, and has had a lot of difficulties with fundraising
So would you say right now who's #1 up north, Onex or Altas?
Onex returns have been sub-par.
Kelso, brightstar, golden gate
What’s up with Brightstar?
Do you think the Qual-Tek investment hurt them or were they able to pump and dump enough shares to retail in time…
What happened at Qualtek? I remember looking at them at my old firm but we passed. Don't remember why I was pretty new to that seat.
Why Kelso?
Delete
Delete
Curious as well about Kelso - seemed like nice guys. Recently chatted with a VP from there and liked the vibe.
Delete
Do you know any updates on Kelso and Brady? How's the massively over projected synergies looking?
Sun Capital. They're like a stink that doesn't go away.
When they're doing turnaround deals looking for diamonds in a pile of shit, they're gonna smell like shit. Should not have worn those white pants
Bro in their latest fund, the bought a company where the CEO went to prison for murder lol
"Experienced management team with decades of experience and a killer instinct to drive results"
What Company?
Recently had a departure of their entire healthcare team which spun out on its own, lost a couple partners and a whole deal team.
What's the fund name?
Carlyle.
In last two years they have 1) reduced headcount considerably, 2) completely exited Consumer, 3) Missed fundraising targets due to poor performance, 4) Had partners leave.
We’ve stopped showing our good deals to Carlyle.
MDs think they’re an absolute mess right now.
Agreed… firm is a mess across the board. Significant senior departures over the last 6 months alone.
Their reputation has been bad for a while. They are asset gatherers at this point.
I think in European context I would say:
What’s happening at Cap10?
I think they botched a deal and so the co founder / Partner responsible has left as did some of the VP and more junior personnel
Looks like they've already gone downhill, but anyone know what happened to CCMP (formerly JP Morgan Partners)? They used to be large, but they've fallen off the map.
Several execs/seniors left to start Consonance Capital, LMM healthcare firm
CCMP's CEO Stephen Murray passed away in 2015, which led to other senior departures from the firm. They were trying to raise Fund IV in 2015 but never ended up closing a fourth fund. Eventually they raised a continuation fund as they wound down the firm as it was. Some members of the remaining team recently launched CCMP Growth Advisors.
Carlyle is a mess.. CEO left given battle with founders and serious succession issues.. also over indexed to China so Asia portfolio is struggling and they have been laying off people.. way behind on fund raising and will likely be the only MF to raise smaller funds
among those who over extended in 2021, I would put Vista, Insight, TCV, Hellman and Silverlake to some extent in the same bucket.. they will seem fine for now but the next fund is going to be half the size and partners will leave
Agree on Carlyle. Low performance, high turnover, significant layoffs, terrible fund raising, and succession issues. The firm is a complete mess, especially compared to other MFs.
Disagree on most of your tech names. For example, Vista wasn’t even included in top 10 Capital deployment for 2021 as they focused predominantly on exits. Whereas TB and KKR tech put record amounts of Capital to work at ridiculous valuations. Although I still feel confident in their ability to produce decent returns at least. I definitely wouldn’t consider any of those names “downhill”.
Insight might be a different story…
Also agree on Carlyle - they are absolutely already down the hill, definitely a shell of what they once used to be.
Like comment above, also heavily disagree with randomguy's tech PE firms. Not sure if it was just funny timing, but to refute "they will seem fine for now but the next fund is going to be half the size and partners will leave", Vista just raised their largest ever flagship at above $20B LOL (https://www.blackenterprise.com/vista-equity-raises-twenty-billiion-fun…). So that's simply wrong. Maybe just Insight because of their shitshow recent fundraise, but wouldn't take that and apply it to Vista, H&F, Silver Lake etc.
Valuations were absolutely crazy in 2021, and yes, some firms overdeployed and overpaid. For example, TB's $24B flagship vehicle is screwed, as of right now, because of how much of it they deployed at sky-high SaaS valuations, whereas Vista and H&F stayed much more disciplined and won't face that problem to the same extent as TB (in fact, Vista and H&F focusing more on exiting in the 2021 valuation environment has helped them, if anything).
The only thing that is even somewhat agreeable is Insight struggling for the next few years, and yeah Silver Lake has been quite funky recently, to say the least. But all of these names are top of Tech PE and PE in general, and are not going anywhere anytime soon.
Why is Insight a different story?
Many of the firms I've come across have been mentioned but I'd say the following:
Great list
Siris is actually winding down? I heard about some struggling portcos and closing the CA office but wow
From my few interactions with seniors there (ie, VP and up), that place is a joke. Have no clue how they were able to raise so much previously
Can confirm the CA office closure - one day they were talking to us on the sale of one of our assets and the next they weren’t… seemed pretty sudden / chaotic
Bro woke up today and chose violence
A number of GIP investment professionals (Principal down to Associate) have already jumped… would have thought Blackrock would learn after Tennenbaum! Have also heard fundraising has been very challenging with prior head of IR leaving mid-way through the current cycle.
Would love to hear more about Brightstar. Know a former Principal there and I remember noticing on LinkedIn that a lot of his peers also left around the same time.
Would throw Ares on here too. Great on the direct lending side and some other strategies as well. But PE arm (specifically ACOF) has struggled in the last 5 years.
Heard Huron Capital is shutting down after 25+ years
Wow 😮
Haven’t they been struggling for a while now. Tons of turnover and departures in the last two years
Always curious what that means for PE firm. Seems like many firms figure out they can't raise new money, but they still run on fees and winding down the portfolio fand maybe the occasional one-off deal. Is this a case of that, or actually liquidating the portfolio ASAP and closing shop? And did they outline the future plan in a letter to fund investors? Unless stuff like that happens, seems like firms just run forever. I think Ripplewood and Quadrangle are technically still in business.
You almost never liquidate the fund, it wouldn't make any sense. The next generation leaves since there is no money to invest, but the head people usually stay to "manage" out the portfolio to final exit.
Former classmate of mine is there - not shutting down but apparently major refocus / downraise. Lot of senior turnover but core younger partner group staying
This is correct, but it’s a pretty significant down raise ~1/4 size of the last fund I heard
Only the big ones will go
Have heard of a few LMM shops closing doors recently, also 777 is treading water
Which LMM shops? I’m in a LMM IB seat and recruiting so definitely interested/ would be much appreciated
One small family office that I'll leave anonymous, also MKH Capital Partners
Isn’t 777 also being investigated by DOJ? One of their partners got canned by Josh Harris new shop bc of that
Not sure by whom, but can confirm an investigation is happening
This question is always pretty tricky, sometimes struggling with fundraising for one vintage doesnt necessarily mean a firm is toast.
That said, BCPartners is a big name that will suffer based on what I see.
The amount of zeros they got over last couple of years is insane. They had departures across the board; fundraising was pretty horrible for last vintage
CLO shops dont want to do business with them, minority investors (PSP etc) either...
Can you name a few of the zeros? Haven’t kept up with them much but heard Garda was doing really well (obviously just one investment of many…).
QHP Capital / NovaQuest is on the downhill IMO.
The founding partners are dishonest, whether dealing with employees, investors, lenders, or portfolio companies. They lie to lenders and investors about portfolio performance, and lie to portfolio company sellers, execs, and other employees about their business plans and track record.
Experienced employees from associate to principal constantly brought up serious issues with prospective investments that should have warranted never bidding, retrading, or walking away, and they were ignored. LPs will unfortunately the consequences.
They cross their worst deals over multiple funds in order to hide the performance and maximize their personal profits at the expense of everyone else involved.
When this firm goes down, they will blame it on the jarring reversal of pharma / biotech values / multiples after they peaked in 2021. That will probably contribute, but it will not be the primary cause of their demise. Bad management will be.
The biggest one
Some additions, including European perspective.
Carlyle - struggling to fundraise (both PE and credit), falling behind massively.
Apax - more plateauing so to say, struggling with their latest flagship.
AlbaCore (credit)
MidEuropa
Triton
Investindustrial
Charterhouse
JC Flowers
3i
Abrdn
Corsair
AnaCap
… can continue …
I was going to ask about Corsair
Can add some of the tech firms like Marlin and vector too.
What is the driver for Apax? I would tend to agree with your sentiment but don't know why they struggled as much to fundraise
AKKR
Clearlake
GI Partners
Golden Gate
Marlin Equity
AKKR and GI Partners, really? I thought they (esp AKKR) had good momentum. What have you heard about these two?
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