ppa specialists

A Guide to Private EquityFund Placement SpecialistsSecond Edition

AG

uideto

PrivateE

quityFund

Placement

SpecialistsSecond

Edition

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Preface

Today’s markets: a two-sided taleJohn Barber, Managing Director, Helix Associates

It was the best of times…It was the worst of times… It was the age of wisdom…It was the age of foolishness…It was the epoch of belief…It was the epoch of incredulity…It was the season of Light…It was the season of Darkness…We had everything before us, we had nothingbefore us.

Ten things to expect from a placement agentChristoffer Davidsson, Vice President,Campbell Lutyens & Co. Ltd

OverviewDeliverablesSummary

What LPs think of placement agentsPrivate Equity International

FacilitatorsPlacement agent plus pointsPraise where praise is dueHomework

Selecting and working with aplacement agentAlan Cooper, MVision Private Equity Advisers

GP objectives: what are the reasons forusing a placement agent?How to select the right placement agentThe costThe role of the placement agent before,during and after the fundraisingDifferent types of placement agentSo, who selects whom?

What placement agents look for in a fundColin Brown, Transparent Capital

Choosing each otherFund selection criteriaMore than just feesFinal thoughts

More than just arranging meetings: therole of the modern placement agentNicole Belmont, Far Hills Group, LLC

Decision to come to marketPre-marketingFundraisePost-fundraise

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Placement_2ed.QXD 01/12/2006 4:08 Page 3

4 A Guide to Private Equity Fund Placement Specialists

Notes to a placement agreementKate Simpson, SJ Berwin LLP

IntroductionPartiesPreambleServicesTermResponsibilitiesCompensationConfidentialityConflicts of interestAppointment of agentsIndemnityRepresentations and warrantiesMiscellaneousConclusion

Presenting the proposition: planning andexecuting the fundraisingRobert E. Mast, Managing Director,Monument Group

Planning and preparation pay offExecuting on the plan – practicalities of thefundraising processApproaching the closingAfter the closingFinal thoughts

Boutiques vs. banks: David and Goliath, or bigis best?James Burr,JPMorgan Cazenove Private Funds Group

Eternally on the road – the fundraising dilemmaA history of the placement agent market: Merrill –DLJ – boutiques – todayPick the best model and stick with it – until it needs changingThe devil is in the detail – thorough due diligenceThe great unknownAny clearer?

A gatekeeper’s view of placementagents: a changing environment for the industry’s pathfindersStefan Hepp, CEO,SCM Strategic Capital Management AG

Notes from the frontline

The Surveys

The LP Survey:Investors on placement agentsThe GP Survey:General partners on placement agents

The Directory

Appendices

Appendix One:Private Equity International on fundraisingand placement agentsAppendix Two:PrivateEquityOnline.com on fundraisingand placement agentsAppendix Three:About Private Equity InternationalAppendix Four:About Private Equity InternationalResearch PublicationsAppendix Five:Index to directory entries

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52535454

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It was the best of times, it was the worst of times, it was theage of wisdom, it was the age of foolishness, it was the epochof belief, it was the epoch of incredulity, it was the season ofLight, it was the season of Darkness...we had everything beforeus, we had nothing before us.

Charles Dickens, “A Tale of Two Cities” (1859)

Never have private equity markets been as large, profitable,notable, significant and active as they are today. Private equitydeal-making and fundraising volumes are breaking records, thescale of recent returns surprises even the oldest of hands,major newspapers and broadcasters devote daily coverage tothe industry, funds are acquiring ever bigger and better knownassets, and the velocity of investments and realisations seemsconstantly to accelerate.

Recent years have also found professional standards risingacross the private equity industry. General partners must havegenuine angles on deals to win them, and must alsodemonstrate that their impact on a portfolio company will gowell beyond re-designing its balance sheet. Limited partners dofar more homework, more thoroughly, than in times past,relying more now on dispassionate analysis than personalchemistry in forming judgments. Placement agents are asked tojustify an investment case, not just introduce it, and to ensurethat increasingly complex offering processes are managed withmilitary timing and microscopic attention to detail. Partnershipagreements are more tightly constructed, valuation guidelinesmore explicit, and reporting standards more appropriate to amulti-billion asset class than a cottage industry.

Superficially, it would therefore seem that the private equitybusiness is in rude health, with its extraordinary trajectory ofgrowth in prominence, profitability and power set to continue.Yet such a broad-brush conclusion would mask more subtlefindings – parts of the market overlooked by its generalprosperity, the flip side of record-breaking volumes, the seedsof a potentially bitter harvest now sown in over-pricedpurchases or rushed due diligence exercises. This duality inconditions will be assessed with inspiration from Dickens,relying on his insight that no judgment – in one or otherdirection – can be absolute.

It was the best of times…

For many general and limited partners, 2005 may prove abanner year like no other. One global firm raised $14 billion forits new buyout fund, an amount equal to the total that allEuropean buyout funds raised collectively only as recently as1998. The industry as a whole is set to raise more than $250billion worldwide in new capital during the year, exceedingeven the Internet boom-inflated totals for 2001, the priorrecord holder. Many brand name funds seemed to close in2005 almost before they launched, meeting with overwhelminginvestor demand and beating standard fundraising timetablesby months. New institutional investors entering the asset classannounced target allocations in the billions, which will maketheir individual programs larger than the entire industry ageneration ago. Google in the US and Skype in Europe provedthat venture capital dreams of 200:1, or even 600:1, gains cancome true. Limited partners experienced a cascade of cashreturns, with many underlying investments effectively de-

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Today’s markets: a two-sided tale

John BarberManaging Director, Helix Associates


Overview

In today’s turbulent private equity world, the role played bydifferent placement agents in the fundraising process is asvaried in scope as it is in quality. For many private equity fundmanagers the contribution of a placement agent hasbecome integral to this process - as well as to thesubsequent dialogue between the fund and its limitedpartner investors (LPs).

A general partner (GP) who intends to use a placementagent should have high expectations of the services to beprovided and should expect at the very least a number ofclear deliverables. Raising private equity capital is aspecialist, sophisticated and complicated activityundertaken within a constantly changing marketplace. To beefficient and effective, fundraising requires trueprofessionalism - whether through the commitment ofinternal resources within the general partnership itself or viathe use of an external agent or adviser.

Today, investors are applying far more formal and rigorousmethods when assessing a proposal from a GP. In this context,the placement agent’s activities have to be much more diverseand multi-faceted. The agent not only caters to the generalpartner, who seeks advice and capital in raising a new fund, butalso plays a prominent role in the interaction with institutionalinvestors and the private equity community at large.Consequently, the expectations of a placement agent and theservices they are expected to provide range over a broad areaand have become more complex in nature.

With the increased sophistication of the private equity investorcommunity in general, and the wider participation of specialistgatekeepers and fund of funds managers in particular, theservices offered by a placement agent and the professionalismwith which these are provided have become subject to far morerigorous and formal assessment by clients (GPs) and investorsalike. As a result, it is critical that placement agents are able todemonstrate both an intimate knowledge of the private equitymarket and a deep understanding of the needs of the investorcommunity, be proactive in conducting thorough due diligence,be intimately involved in the preparation of marketing materials,demonstrate a professionalism in execution and maintain theutmost integrity in the continuing relationship between thegeneral partner and its investors.

Deliverables

There are a number of specific deliverables that a generalpartner should therefore expect to receive from their placementagent in order to introduce greater certainty that the funds willbe raised and that the process be as successful and painless aspossible. Following is a list that general partners contemplatingraising a fund with the help of a placement agent or advisercould use when assessing prospective placement candidates.

1. Pre-fundraising advice

Fund placement activity is at its heart an advisory activity. Priorto the launch of a fundraising effort it is imperative that theproposition is clearly thought through and the implications ofcurrent market conditions be understood. The placement agent

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Ten things to expect from a placement agent

Christoffer DavidssonVice President, Campbell Lutyens & Co. Ltd


When Private Equity International (PEI) magazine hasundertaken polls of private equity fund managers, limitedpartners and intermediaries to find out which individuals andinstitutions investing in European private equity funds wereregarded as ‘most influential’ in the asset class, we have beenreminded that ‘influence’ could result from attributes otherthan just big chequebooks. While money, or more specificallythe ability to make large and regular capital contributions anddistributions, is obviously helpful when it comes to developinga reputation in this industry, there were other ways in whichinstitutions are seen to shape private equity – and in doing somake widely known names for themselves.

For example, when it came to determining who was helpingshape private equity as an asset class (in other words, thosewho are instrumental in helping private equity evolve as adestination for investment capital), some limited partners areapplauded for the high-end research they undertake prior tocommitting to investment propositions. When these bellwetherinvestors decide to make a fund investment, many of theirpeers will likely be inclined to follow suit. Other investors areheld in high esteem for their ability to negotiate – and changeto their advantage - the terms and conditions of limitedpartnership agreements.

At a time when the industry is undergoing dramatic change,both best in class due diligence and effective negotiation withfund managers are having a significant impact on how privateequity as an asset class functions. However, limited partnersare by no means alone in driving this process. “What about theplacement agents?” many practitioners have asked us,

confirming that this group is instrumental in determining whatkind of product is coming to market, how it is being sold andwho is likely to buy it. The fact that agents are singled out bythe market as amongst the groups helping to shape the assetclass is a telling reminder of just how deeply embedded in theprivate equity business placement professionals have become.

Facilitators

Placement agents serve as facilitators of capital flows from LPsto GPs. Helping general partners to raise the next fund can belucrative business, especially in a market environment whereGPs are increasingly reluctant to go out on the fundraising trailwithout first enlisting a placement advisor of their liking. Manymore private equity fund managers are mindful that the timerequired to raise their new fund is going to be far longer thanin the past: whether you have raised funds before or not. Moreprospective investors will have to be seen, most of these willask more questions and most too will take far longer (andhence require more follow up).

It is not surprising therefore that general partners who meet oreven exceed their fundraising targets are today much quickerto give credit to their placement consultants for every dollar,euro or pound they feel they may not have raised on their own.But what do investors think of these professionals? Do theyrate their contribution to the capital-raising process? Do theyfeel that agents add value, and if so, how?

These questions are relevant, not least to the placementadvisors themselves, because although they get paid by, and

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What LPs think of placement agents

Private Equity International


27

The role of the placement agent before,during and after the fundraising

Depending on why and how the placement agent was selectedso its role will change according to whatever has been agreedwith the GP – no two working arrangements are likely to be thesame. For example, if a GP engages a placement agent merelyto ‘top up’ a fund which has already had one or more closings,the agent will probably not have been involved in any of theplanning or the preparation of materials and clearly has alimited role to play, possibly even restricted to country-specificactivities or approaching only specified classes of investor. Atthe other end of the spectrum a full service placement agentinvolved from the initial stages of a fundraising, or even of thefund development itself, may be expected to play a central rolein planning every aspect of the campaign and supporting theGP’s professional team in the development of their business.

Prior to fund launch

A critical factor is the broad market experience and knowledgeof placement agents gained from multiple fund placements setagainst the necessarily limited exposure of most GPs. Therefore,involving a placement agent as far ahead as possible of a fundlaunch can benefit the GP enormously, because putting thatexperience and knowledge to work is vital for effective planning– and effective planning is essential. As every good campaignerknows “time spent in reconnaissance is never wasted”, and oneof the key contributions of a placement agent is continuousanalysis of investors and deploying its knowledge of the marketlandscape. This work will identify the right investor base for thefund. At the same time this knowledge will be invaluable inhelping the GP determine the structure of the fund and its terms,and will underpin an effective pre-marketing effort. At this stagethe placement agent will also help in the development ofcomprehensive due diligence and presentation materialsdesigned to differentiate the fund in the market and recognisethe expectations and demands of the prospective investors.

During the fundraising

Of course, the number one priority of a GP, and the placementagent, is to secure investors, and during the official marketingof the fund the placement agent will unroll its campaign toplace the fund with selected investors, perhaps according to acarefully targeted plan or perhaps through a mass distribution.Ideally the fund will reach its preferred fund profile – thedesired fund size with the right LP mix – but, regardless of thequality of the GP or the placement agent, the process is notalways easy. Many GPs underestimate the stress involved andthe magnitude of the logistical exercise. Full service placementagents will relieve the GP of much of the administrative andlogistical burden and help manage the entire process. Evenmedium-sized fundraisings can involve organising severalhundred meetings, detailed roadshows, arranging extensivetravel for the GP principals, the production and delivery ofnumerous iterations of sophisticated documents andpresentations, the organisation of large numbers of duediligence visits and calls, coordination of professional servicesfrom lawyers, accountants and other consultants, and thehandling of multiple simultaneous transactions. All this beforethe often complex and intense closing process.

This is always a mammoth and time-consuming undertaking,often lasting several months with little or no let up. Meanwhilethe GP must carry on running its business: continue itsinvesting program, generate and manage exits, and maintaindealflow. This is where the placement agent supplying the fullarray of services really proves their worth – raising the moneyand managing this process to the fullest extent.

After the fundraising

Ideally it’s not over even when it’s over. A solid continuingrelationship with a successful GP is something that allplacement agents would like to preserve in the long term,covering multiple fundraisings. First of all the twists and turns

Selecting and working with a placement agent


Times are changing for the traditional placement agents. Thelarge investment banks should be concerned. Their big teamsrepresent a huge cost base and many of the established largefunds are turning their backs on the traditional placementagents due to the huge fees charged in the past. Many of thesuccessful funds now are refusing admission to new LPs andthe biggest problem for some GPs is how to scale backapplications. The world is now clearly divided between the‘haves and the have nots’.

There will always, however, be a need for agents for certainfunds not in the ‘golden circle’ of those GPs able tosuccessfully raise capital on their own. I believe the trendwill be for these groups to retain some form of placementagent on a semi permanent basis… of which more later.

Firstly, it is worth considering how the two quite differentparts of the private equity industry – GPs and placementagents – view each other. Some GPs would argue thatplacement agents are no more than an upmarket – andexpensive – dating agency. I would not entirely disagree withthis statement but, to explore the analogy, one needs to lookat the types of dating agencies that exist today. For thosereaders who don’t know – or would prefer others to believethat they do not know – there are essentially three types.

Firstly, there are the dating agencies which merely supply a listof names as potential suitors and little more. One can think ofthese as novice placement agents who have a database ofcontacts – such as The Global Limited Partners Directorypublished by Private Equity International.

There are then those dating agencies who offer what theythemselves will call a global service and have 20 or so differentpeople on the case to help the client. These are the investmentbanking placement agents.

In the middle there are those dating agencies who offer to helpa limited number of clients but who also claim extensiveknowledge of potential suitors for its kind of client. Think ofthese as the boutiques.

Choosing each other

Whilst every GP group is different, the same can also be said ofplacement agents. There is not one correct way for any GPgroup to go when selecting an agent. Of course, what iscommon is for a GP group to try and get its chosen agent foras little as possible. This can, however, prove to be a gravemistake for reasons I detail below.

Just as a GP group goes through its own selection processboth with regard to the type of agent and the selection of theparticular agent within that group, so does the agent scrutinisecandidate funds closely. Any serious placement agent intoday’s tough fundraising environment will be moreconcerned with its reputation than short-term monetary gainand a good agent will probably turn down 50 opportunities forevery one even seriously considered. Although the often-touted expression that placement agents are only ‘as good asthe last fund’ is simplistic, it is nonetheless true that agents doget a reputation for either being associated with quality fundsor not. This is probably more important for the small boutiques

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What placement agentslook for in a fund

Colin BrownTransparent Capital


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Introduction

Selecting a placement agent is the hard part – documenting thedeal is usually relatively easy. During the selection process thegeneral terms of the placing, particularly the compensation, arelikely to have been discussed and agreed in principle. Once theplacement agent is selected, the parties will then seek to set outthe agreed terms in writing. Often this process will becontinuing at the same time as the placement agent is workingwith the General Partner or manager (the “fund manager”) todraft the offering document and beginning to market the fund.As such, there may be little scope for walking away from thearrangement and therefore the negotiation of terms reliesheavily on the parties reaching a commercial agreement andthe strength of the relationships involved.

Initial drafts of a placement agreement are usually provided bythe agent itself in its “standard form”. This document isnegotiable, although the degree of movement on certain termsis often heavily affected by the identity of the agent. Largeinvestment banks may be less inclined (or able) to amendstandard terms than smaller boutiques.

The placement agreement will generally take the form of aletter and will cover various key commercial areas, includingcompensation, duties of the placement agent and the futurerelationship between the fund manager and the agent afterthis fund is closed. It will also cover various legal matters suchas indemnity provisions, representations and warranties andcompliance with securities laws.

This chapter is designed to set out guidelines as to theareas to cover and points to address within a placementagreement. Given the variety of terms one sees in suchagreements, this is not an exhaustive list and there is scope forthe principals to agree bespoke arrangements which may bemore appropriate in the circumstances.

Parties

As mentioned previously, placement agreements often takethe form of a letter. This should be addressed to the entitythat will operate and manage the fund, normally the fundmanager. It is generally inappropriate for the letter to beaddressed to an individual, as they become the contractingparty and have responsibility for the matters contained inthe letter, e.g., compensation. It is also equally inappropriatefor the contracting party to be the fund itself – this isbecause generally at the time of execution of the letter thefund will not have been formed; in addition, it is marketstandard that the fund will not bear the placement agent’sfees or any liabilities arising out of the placingarrangements.

Preamble

The initial paragraph of the letter will include certain generalinformation, including:

• The name of the placement agent, the fund manager andthe fund.

• The target size of the fund and the currency.

Notes to a placement agreement

Kate SimpsonSJ Berwin LLP


Signed and sealed. You’ve just closed another great deal whichis going to make you and your investors a great deal of money.Your current fund is going well, and is now well over 50 percent invested. It’s been two years since you raised it, and thepain of many days and months spent on the road are a longand distant memory.

But hang on… One more deal and an add-on for another couldtake you over 70 per cent invested. In the time it takes to raisemore capital your current vehicle could be full, and thewhispers will go round the market that you have no cash. Adisaster for dealflow and your reputation. It’s time to go andplead for money once more.

Eternally on the road – the fundraisingdilemma

“The best time to be selling is when you have nothing to sell.”“Keep your Partners close and your Limited Partners closer.”“Don’t come and see us last…” General Partners (GPs) hearthese phrases, take notice of them, and promptly get involvedin the business they are paid to do, which is doing deals.Fundraising is not always a priority. Some GPs prefer to do thisdirty business alone with in-house teams, or assign the task toa senior individual best suited to it. A placement agent is notnecessarily top of the agenda. The thinking runs along the linesof “why pay that guy to do it when we can perfectly wellmanage the situation ourselves?”

But the time spent away from the fundraising market is crucial.Things move quickly in this business, despite its long-term

approach. Limited Partners’ (LPs) attitudes towards strategies,terms, teams and people change. LPs themselves change.Turnover happens to them too. A placement agent may benecessary after all. But who?

Away from the deal market, there have been some fairlysignificant changes in the placement agent arena. Therehave been some winners and losers and some comings andgoings. There has also been a fundamental change in theway in which placement agents have approached theirbusiness.

A history of the placement agent market:Merrill – DLJ – boutiques – today

The origins of the current placement agent landscape can betraced back to 1988 when Merrill Lynch brought together agroup who were dedicated to raising capital for private equityand other funds. Amongst those still in the game, the team wasled by Jerome Green and assisted by the likes of Ray Cosman,Dale Meyer and Phil Pool.

After Green left to join Benedetto Gartland, Kevin Albert joinedthe team and was appointed its head in 1993. At this time,however, Phil Pool and a number of colleagues, including BobRivett, Chad Schultz and Ray Cosman, left to form a similarplacement business at DLJ. So started nearly a decade of thetwo businesses vying for supremacy, with various personnelmovement, both between the two and away from both, aspeople left to form new ventures. All served to keep the gossipmill running.

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Boutiques vs. banks: David and Goliath, or big is best?

James BurrJPMorgan Cazenove Private Funds Group


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It is something of an irony that, for many established private equityfirms, the question of from where to raise the capital for a nextfund has paled in significance (due to their vehicles beingoversubscribed) to more strategic issues, such as how to improvethe mix and balance of the investor base, how to communicatesuccession issues and organisational changes, how to winsupport for an evolving business strategy or a geographicexpansion and how to differentiate a GP in the eyes of investors.

These challenges require an ongoing effort where the temporaryassignment of a placement agent is next to useless. It is thus notsurprising that the percentage of funds reviewed by SCM thatinvolve a placement agent has declined in recent years andreached a low in 2005 (see Chart One1).

The growth of in-house fund placement teams has increasedprice competition for the available assignments, especiallyfor the popular upper mid-market and large buy-out funds inparticular. As a result, GPs have been able to customise theassignments of placement agents by restricting theirgeographical focus, concentrating their involvement on thepreparation of offering documents and the processing of duediligence information requests, or prescribing the number

and type of new potential investors they want to getintroduced to. Naturally, such a narrowing of the scope ofplacement agents’ involvement has also been accompaniedby pressure on fees charged.

Less obviously, it has in some instances caused placementagents to lose control of the book-building effort that leads toa closing. There have been instances where GPs increased thetarget amount of their funds shortly before a first closing,reduced the amount of subscription allocated to new investorsintroduced through a placement agent or changed theallocation in a way that contradicted the undertakings that theagent had given to investors they were presenting a fund to.Such a lack of co-ordination undermines the credibility of aplacement agent and can potentially raise the question ofwhether the reduced fee is worth the franchise risk the agentmight assume.

While the growth of some private equity firms has clearly ledthem to build in-house fundraising and investor relations teams,the same challenge persists for many smaller and mid-sizedfirms as well. There have been placement agents that try topursue a business model of more ongoing involvement withinvestors on behalf of the funds they represent, but in reality thisis still an approach more talked about than implemented. SCMexpects the trend towards an ongoing investor relations effort tocontinue among private equity firms. This would imply that GPsincreasingly need to think about whether to retain a placementagent or an investor relations firm on an ongoing basis, or tobuild-up their internal resources. While an ongoing outsourcingto a placement agent might increase the cost versus atemporary fundraising assignment and thus push more firmstowards an in-house solution, it also creates a businessopportunity for those placement agents that have the depth ofresources to handle the wider range of tasks that come withsuch an assignment.

A gatekeeper’s view of placement agents

1. The data displayed in the chart reflects SCM’s dealflow for the period 01.01.05-30.09.05 and includes 235 private equity partnerships and other investment vehicles. Thepercentage of the funds in the sample using a placement agent declined from 58 per cent in 2004 to 51 per cent in 2005. This may both reflect SCM’s pro-active deal sourcingthat focuses on ‘invitation-only’ funds (no placement agent) as well as the tendency among, in particular, large buy-out firms to use in-house teams for fundraising.

Chart One: Use of placement agents by fundsreviewed by SCM in 2005

Fundunaccompanied byplacement agent

49%

Fund accompaniedby placement agent

51%

Source: SCM, 2005


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The answer from GPs is an emphatic yes on all counts. Over 90per cent of respondents stated that levels of quality within theindustry does vary from agent to agent. By far the largestproportion (79 per cent) indicated that quality variessignificantly; a further 12 per cent stating it can vary somewhat.Only 9 per cent of GPs feel placement agent quality is more orless the same regardless of which agent you are dealing with(see Chart Nine).

Providing more than placement: would GPsbuy IR and other advisory services from anagent?

A growing number of placement agents are keen to cementtheir relationship with GP clients by participating in ongoinginvestor relations programs and providing related consultingand advisory services to them. Not only can this provide newrevenue streams for the agent but also helps to distinguish thisagent from “the rest of the pack”. In a more competitive marketagents are especially keen to build out these extra, value-added services, particularly given that IR initiatives ensure thatthe agent is in regular dialogue with both active limitedpartners and with the general partner group.

GPs remain sceptical though: over 70 per cent indicated thatthey would not consider buying such IR and related servicesfrom an agent in between fund raisings (see Chart Ten). Theinference being that most still regard the placement agent asfulfilling a particular role (raising capital, as quickly andefficiently as possible) at a particular time (the fundraisingperiod) and that the ongoing management of LP relationsstands outside the agent’s orbit. Some though (and agents inparticular) may be more interested in the fact that nearly 30 percent of the GPs said they were prepared to consider buyingthese services from the agent.

GPs see four boutique firms as being clearlyahead of their rivals, while mighty CSFBdominates the investment bank category

Just as investors in private equity funds were invited tonominate their top three placement agents, so our survey ofGPs concluded with the same invitation. Again, as with the LPsurvey (and unlike the first edition of this title) we have optednot to ask for rankings of placement agents in terms ofEuropean groups vs. US firms. Rather, we have split theplacement agent market along the more natural lines of

The GP Survey

Depending on which placementagent you are dealing with, thequality of service and level ofprofessionalism provided:

Can differ significantly

Can differ somewhat

Is likely to be more or lessthe same

79%

12%

Would you consider buyinginvestor relations and relatedconsulting services from aplacement agent in betweenfundraising?

Yes

No

30%

70%

10%

Chart Ten: Would GPs buy IR and otherconsulting services from placement agents?

Chart Nine: Does placement agentquality vary from agent to agent?

9%


111The Directory

Services Fund types placed Geographic coverage

5 Clifford StreetLondonW1S 2LGUnited Kingdom

Tel: +44 20 7439 7191Fax: +44 20 7437 0153Web: www.campbell-lutyens.comEmail: [email protected]

Campbell Lutyens & Co. Ltd

Sample clients Profile

Branch officesNew York, USA+1 212 223 1799

Year established

No. of personnel

Key contacts

Andrew Bentley (London)[email protected]

Eric Estes (New York)[email protected]

GeneralistLarge buy-outMid-market buy-outEarly-stage ventureLater-stage ventureSubordinated debt / MezzanineTurnaround / DistressedSecondariesFund of fundsReal estateEnergy / Oil & gasSector funds

Campbell Lutyens is an independent private equity advisory firm founded in 1988. It hasoffices in London and New York and comprises a team of over 20 professionals. It providesspecialist advice to institutions, general partners and other organisations on all aspects ofthe private equity sector. Campbell Lutyens assists fund managers to raise private equityfunds including venture, buy-out, mezzanine and special situation funds. It assists in allstages and aspects of the strategy, structuring and fundraising process. It acts for managersof European, US and Asian funds raising capital from institutional investors globally.Campbell Lutyens advises on the sale or restructuring of portfolios of private equity fundsor of direct private equity holdings; the restructuring of individual funds and private equitygroups; mergers and acquisitions of private equity managers; and offers strategicconsultancy on the approach of public and private sector institutions to private equity.

Fund placement Investor relations Secondaries advisoryRestructuring advisoryConsultancy

Alto Partners; Arsenal Capital Partners;Bowmark Private Equity (formally Sagitta);Clearwater Capital Partners; CrescendoVentures; Equivest; Essex Woodlands; EuropeanVenture Partners; Hamilton Lane; Mercapital;Mezzanine Management; Navis Capital; NMAS1Private Equity; Norsk Vekst; Penta Capital;Primary Capital Limited; Shamrock; VPSA

••••••••••••

GlobalNorth AmericaWestern EuropeCentral & Eastern EuropeAsia PacificLatin AmericaMiddle EastAfrica

•

1988

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Andrew Sealey (London)Managing [email protected]

John Campbell (London)Senior [email protected]

Jean-Charles Charpentier (London)[email protected]


133The Directory


1114 Avenue of the Americas30th FloorNew York, NY 10036United States of America

Tel: +1 212 840 7779Fax: +1 212 840 1233Web: www.farhills.comEmail: [email protected]

Far Hills Group, LLC


Branch offices

Year established

No. of personnel

Key contacts

Seth [email protected]

Nicole BelmontVice President – Director of [email protected]

GeneralistLarge buy-outMid-market buy-outEarly-stage ventureLater-stage ventureSubordinated debt / MezzanineTurnaround / DistressedSecondariesFund of fundsReal estateEnergy / Oil & gas

Far Hills Group specialises in the placement of alternative investment offerings toinstitutional investors. Since the firm's founding in 1990, we have placed in excess of $10billion in over 31 different investment vehicles. Our practice is exclusively focused on theinstitutional investment community and includes endowments, foundations, banks,insurance companies, corporate pension plans, family offices and their consultants. We area global practice headquartered in New York and have raised assets from investors in Asia,Europe, Latin America, and the Middle East. Our fundraising process focuses ondifferentiating the manager's strategy and strengths through value-added prospectcommunication and interaction. With a focus on sales, we provide strategic advisoryservices that foster institutional placement and may include full-scale materialdevelopment, fund structure consulting, and prospect and investor communications. Ourplacement activity focuses on institutional investors, including major endowments,foundations, insurance companies, family offices, and banks both domestically and abroad.

Full service fund placement, which includesstrategic and document preparation advice,marketing material development, and investorrelations

Brooks Houghton & Co.; Clarion CapitalPartners; Larch Lane Advisors, LLC; MarwitCapital; OrbiMed Advisors, LLC; S2 TechnologiesCorp.; Vertex Venture Capital

••••••••

••


•

1990

13

Peter NovelloManaging [email protected]

Geoffrey [email protected]

Mike [email protected]




5th Floor23 King StreetLondon SW1Y 6QYUnited Kingdom

Tel: +44 20 7968 6960Fax: +44 20 7968 6968Web: www.helix-associates.comEmail: [email protected]

Helix Associates



Year established

No. of personnel

Key contacts


Helix was established in 1993. Its founders aimed to create a placement agent that couldexercise its own judgement in selecting which clients to represent. The firm's reputation isbased on discriminating fund selection; thoughtful and balanced research; rigorous duediligence; and effective project management. This approach has generated a consistenttrack record of successful outcomes. Each year, Helix acts as the placement agent for aselect number of high-quality private equity funds. In May 2005, Jefferies & Company, Inc., amiddle market-oriented investment bank quoted on the New York Stock Exchange, acquiredHelix. Jefferies’ support and incremental relationships will allow Helix to achieve a newphase of growth, while building on its recognised strengths. As part of this growth plan,Helix is further building its US capabilities and in mid-2005 established an office in NewYork.

Fund placement and related corporate financeand investor relations services

Altor Equity Partners; Bridgepoint Capital;Corpfin Capital; European Acquisition Capital;Exponent Private Equity; Graphite Capital; HicksMuse Tate & Furst; Innisfree; Jefferies CapitalPartners; Madison Dearborn Partners; PiperPrivate Equity; PPM Capital; Quadrangle CapitalPartners; Quadriga Capital

•••

•••


•

1993

13 executives, 4 support

Lord Charles Cecil (London)Managing [email protected]

Philip Kemp (New York)Managing [email protected]


143The Directory


20 MoorgateLondonEC2R 6DAUnited Kingdom

Tel: +44 20 7588 2828Fax: +44 20 7155 9000Web: www.jpmorgancazenove.com

JPMorgan Cazenove



Year established

No. of personnel

Key contacts


JPMorgan Cazenove is one of the UK’s leading investment banks. It combines innovativeand impartial advice with a broad range of capabilities and proven execution skills. It iscommitted to providing its clients with the highest quality of services based on a deepunderstanding of their needs which has been built up over many years. It provides a fullrange of investment banking services, including financial advice, M&A, investor relations,debt and equity capital markets advice and execution and equity research and distribution.

Fund placement and financial advisoryInvestor relationsSecondaries advisoryGeneral consultancy / strategic advice

Axcel; CapMan; Dunedin Capital; EngelfieldCapital; Herald Ventures; LBO France; Legal &General Ventures (LGV)

•••••••••••


•

2004

10

Alex BanceDirector+44 20 7155 [email protected]


151The Directory


500 Boylston StreetSuite 1650BostonMA 02116United States of America

Tel: +1 617 423 4700Fax: +1 617 423 4701Web: www.monumentgroup.comEmail: [email protected]

Monument Group


Branch officesMG is currently in theprocess ofestablishing aEuropean office,which we anticipatewill be operational inlate 2005

Year established

No. of personnel

Key contacts

Michael C. MillerManaging [email protected]

John M. McLarenManaging [email protected]


Established in 1994, Monument Group is an independent registered broker-dealer located inBoston, whose sole business is raising capital for superior alternative investmentopportunities. Monument Group focuses its placement efforts on a broad range ofinstitutional investors located primarily in North America, including endowments andfoundations, public and corporate pension funds, financial institutions, consultants, fund offunds managers and wealthy families. Monument Group specialises solely in private,alternative asset investments. The firm's buy-side investment experience coupled with itsrelationships within and knowledge of the institutional investor community provide acompetitive advantage over other placement agents. Monument Group's experienceprovides the up-to-date market insights necessary to raise funds in a changingenvironment. Such unique expertise differentiates Monument Group and allows it toprovide one of the best placement services available in the market.

Fund placementStrategic advice (in tandem to fund placement)Marketing (in tandem to fund placement)Investor relations (in tandem to fundplacement)

Alta Communications; Altor Equity Partners;Beacon Capital Partners (real estate); CapitalResource Partners; Cerberus InstitutionalPartners; Clayton, Dubilier, & Rice, Inc.;HgCapital; JP Morgan Partners Asia; Lime RockPartners (oil & gas); Madison DearbornPartners; Monitor Clipper Equity Partners;Oaktree Capital Management; Palladium EquityPartners; Patron Capital Partners (real estate);Quadrangle Group; Vestar Capital Partners;Walden International; WaldenVC; WestonPresidio Capital

•••••••

••


•••

•

•

1994

16

Alicia M. CooneyManaging [email protected]

Robert E. MastManaging [email protected]

Janice M. LauerManaging [email protected]


153The Directory


Connaught House1-3 Mount StreetLondon W1K 3NBUnited Kingdom

Tel: +44 20 7491 8500Fax: +44 20 7491 8700Web: www.mvision.comEmail: [email protected]

MVision Private Equity Advisers Limited



Year established

No. of personnel

Key contacts

Jennifer Rinehart (New York)[email protected]

Hussein Khalifa (New York)[email protected]


MVision is a leading independent private equity placement agent with over 20 professionalsoperating from offices in London and New York. MVision provides highly sophisticated,carefully targeted, comprehensive fundraising services on a global basis. Clients around theworld are select private equity fund managers that are leaders regionally and internationally.We research markets and opportunities carefully, and perform extensive reviews of GPsoperating different strategies around the world, developing selected relationships with greatcare. MVision has exceptional relationships with the major investors in all geographies, andits global investor reach provides its clients with access that leads to optimal funding levelsand investor balance. We are in constant direct contact with the leading investors in theever-evolving global market. We develop full understanding of their programs and executionprocesses. Investors know we have complete conviction, deep knowledge, unrivalledexperience, and have performed thorough due diligence.

Private equity fund placementInvestor relationsOther associated activities

Abingworth Management; Butler CapitalPartners; CapVis Equity Partners; CHAMPVentures; Chequers; EQT; Friedman Fleischer &Lowe; HealthCap; InvestIndustrial; Mercapital;Orlando Management; Polytechnos; Segulah;Sofinnova; Waterland Private Equity; WellingtonPartners

••••••••


••••

••

2001

20 in London, 6 in New York

Moose Guen (London)[email protected]

Paula Chester (New York)[email protected]

Svea Saake Berry (London)[email protected]




425 California StreetSuite 2300 San Francisco, CA 94104United States of America

Tel: +1 415 402 0700Fax: +1 415 402 0052Web: www.probitaspartners.comEmail: [email protected]

Probitas Partners



London, UK+44 20 7280 5801

Year established

No. of personnel

Key contacts

Kelly DePonte, San FranciscoPartner+1 415 704 [email protected]

Dale Meyer, New YorkPartner+1 212 403 [email protected]

Joseph Porterfield, LondonDirector+44 20 7280 [email protected]


Probitas Partners is an independent provider of integrated, alternative investment solutions.It offers an array of customised services that include placement of private equity funds andinvestment and liquidity management, which are provided by an integrated team ofemployee owners dedicated to leveraging the firm's vast knowledge and technicalresources to provide the best results for its clients. The firm is headquartered in SanFrancisco, California, with offices in New York and London.

Fund placementSecondary sales and liquidity managementPortfolio management and focused separateaccounts

ArcLight; Calvert Street; CIVC; Granite Ventures;KPS; KRG; Shasta Ventures; W Capital

••••••••

••


•

2001

22

Craig Marmer, San FranciscoPartner+1 415 704 [email protected]

Robert Hofeditz, San FranciscoPartner+1 415 704 [email protected]




5 Relton MewsKnightsbridgeLondon SW7 1ETUnited Kingdom

Tel: +44 20 7052 0099Fax: +44 20 7052 0066

Transparent Capital


Branch offices

Year established

No. of personnel

Key contacts

Nancy [email protected]


Transparent Capital is an independently owned global placement services firm founded byColin Brown with the aim of assisting General Partners in fundraising and their interactionwith their limited partners. The firm offers global placement services to alternativeinvestment funds and hedge funds. The firm also offers advisory services on secondaries,investor communication and reporting and advises on carried interest and other incentiveprograms. Prior to founding Transparent Capital, Colin Brown worked for Deutsche Bank andhas assisted in the private placement of US$5 billion of limited partnership interests inglobal private equity funds.

Fund placement for alternative investmentfunds and hedge fundsInvestor communication and reportingSecondaries advisoryAdvice on carried interest and other incentiveprograms

Belmont Advisers; Centurion Capital; HuttonCollins; Legg Mason Merchant Banking;Lexington Partners; New Media Spark; ParallelVentures; Wermuth Asset Management

•••

•

•

•


•

2002

4

Colin BrownFounder [email protected]

Della O’DellExecutive [email protected]

Brian [email protected]


In November 2001 a management team bought out their businessfrom major financial publishing group, Euromoney InstitutionalInvestor PLC. This business was centred on private equity andventure capital, and included the website PrivateEquityOnline.com- already one of the most heavily used private equity news sitesaround - as well as plans for a major new magazine dedicated tothe asset class. That magazine was launched in December 2001and is called Private Equity International.

Since then, that same group of managers plus a growing teamof seasoned journalists and other publishing professionals,have been busy developing a range of publications and othermedia that are all centred on private equity and venturecapital. The company now has offices in both London and NewYork and is able to track all aspects of the industry across alltime zones. We are genuinely global in our approach. Today, weoffer the following publications and products:

Private Equity International: the global magazine for privateequity. One of the most widely read and recognised monthlymagazines on private equity and venture capital. Written by oneof the most highly regarded editorial teams with over thirty yearscombined experience of the industry, PEI delivers fresh newsand insight on how the asset class is developing worldwide.

Private Equity Manager: the first monthly journal written forthose involved in running the modern private equity firm: CFOs,COOs, Heads of IR, Human Resources - as well as the managingpartners. Launched in June 2004, PEM delivers substantivecommentary and guidance on all aspects of operational bestpractice for the private equity and venture firm.

Private Equity Real Estate: a new magazine dedicated tothe world’s private equity real estate markets, developed inresponse to the increasing importance of private equity-styleinvestment within the real estate industry globally. It isessential reading for all investors, fund managers, financiers,lawyers, consultants and developers involved with opportunityinvesting in real estate globally.

PrivateEquityOnline.com: probably the best known websitededicated to private equity and venture capital. Launched inApril 2000, its daily news coverage from around the world isnow read by 40,000 registered users. Journalists in both Londonand New York are posting stories on PEO throughout the day onthe people, the deals and the firms shaping the industry.

Private Equity International Conferences: in order to provideprivate equity professionals with a small number of focusedevents that make full use of the company’s knowledge of theprivate equity industry, PEI is now hosting a series of conferencesin Europe, North America and elsewhere. Our Private Equity COO& CFO meetings in both London and New York, for example, havealready established a significant following.

Private Equity International Research Publications: agrowing series of market reports, research guides anddirectories are being written, edited and compiled by membersof the team to provide in-depth information and analysis forvarious industry participants. These titles address the currentabsence in the market of in-depth products that cover theissues and trends shaping the asset class on a global basis.

For more details on any of these products, call our London (+4420 7566 5444) or New York (+1 212 645 1919) offices.

209

Appendix Three:About Private Equity International


Our expanding range of in-depth market reports, researchguides and directories cover the issues and trends shapingthe asset class on a global basis. They offer private equityand other alternative asset professionals, investors, advisorsand others involved in private equity and real estate thequality research, in-depth analysis and insightful commentthey need.

Directories

These practically orientated, comprehensive and detailedpublications profile investors in the private equity and realestate asset classes, as well as advisors, service providers andprivate equity firms.

• The Global Directory of Investors in Private RealEstate FundsThe only guide to investors in private real estate funds. Thisdirectory provides detailed, in-depth profiles of the privatereal estate investment programs of over 500 institutionalinvestors and advisors from around the globe. Built fromthe ground-up by a team of multi-lingual researchers, thisdirectory is the most comprehensive, extensive and userfriendly guide to current and active investors in the assetclass available. An indispensable fundraising tool for thoseraising and marketing private real estate funds of all types.

• The Global Limited Partners DirectoryThe most comprehensive international guide to investorsin private equity funds. This 990-page directory providesdetailed, in-depth profiles of the private equity

investment programs of over 870 institutional investorsand advisors from around the globe. Built from theground-up by a team of multi-lingual researchers, thisdirectory is the most comprehensive, extensive and userfriendly guide to current and active investors in the assetclass available. An indispensable fundraising tool forthose raising and marketing private equity and venturecapital funds.

Market Reports

These highly specialised and targeted reports are aimed atcovering technical issues or particular areas of the privateequity industry in an incisive manner, providing readers with avaluable primer on these issues.

• A Guide to Private Equity Fund of Funds ManagersThe definitive guide to the global private equity fund offunds market. This 276-page Market Report consists of in-depth editorial from leading fund of funds managers,placement agents and advisors, along with the results ofa survey into the dynamics and future of the fund of fundsmarket undertaken with fund of funds managers,placement agents and LPs. Also contains the mostcomprehensive directory of fund of funds managersavailable, profiling more than 150 managers from aroundthe globe, including contact details, investment remitsand previous funds backed. This report is an essentialpurchase for anyone interested in understanding andraising capital from this increasingly important area of theprivate equity market.

A Guide to Private Equity Fund Placement Specialists210

Appendix Four:About Private Equity InternationalResearch Publications


211

Contributors include Adams Street Partners, LondonBusiness School, Mowbray Capital LLP, O’Melveny & MyersLLP, Partners Group, Probitas Partners, SCM Strategic CapitalManagement, Standard Life Investments (Private Equity) Ltd.

• A Guide to Private Equity Fund PlacementSpecialists (Second Edition)The definitive guide to private equity placement agents, thisMarket Report combines in-depth editorial with a globaldirectory of agents and the results from surveying both LPsand GPs about their views on the role and contribution ofagents in the fundraising process. The book is filled withinformation and comment relevant to anyone involved withprivate equity funds and fundraising.

• Private Equity Technology: Assessing theAlternativesAn assessment of technology solutions and how they applyto private equity firms. This 222-page Market Report coversthe importance and risks of technology, how technologyspecifically applies to the modern private equity firm andincludes a detailed analysis of the technology solutionscurrently available to private equity firms. The guide issupported by a survey of investors’ use of and attitudestowards technology, along with a unique directory of privateequity technology providers and their products/services.This guide is essential reading for anyone involved indeveloping a private equity firm’s technology infrastructure.

• The France LBO ManualA practical guide to structuring private equity-backed buy-outs in France. Written and researched by leadinginternational law firm Ashurst, this guide addresses allaspects of private equity-backed buy-outs. Topics coveredinclude: the development of the French buy-out market;the structure of leveraged buy-outs; documentation; takingequity; debt and security; taxation aspects of LBOs; theimpact of EC and French merger control and anti-trust

rules; public to privates; structuring equity incentives formanagement; insolvency; and more. This 180-page report isan essential resource for all those involved in Frenchprivate equity buy-outs.

• The German LBO ManualA practical guide to structuring private equity-backed buy-outs in Germany. Written and researched by leadinginternational law firm Ashurst, this guide addresses allaspects of private equity-backed buy-outs. Topics coveredinclude: the development of the German buy-out market;the structure of leveraged buy-outs; documentation; takingequity; debt and security; taxation aspects of LBOs; theimpact of EC and German merger control and anti-trustrules; public to privates; structuring equity incentives formanagement; insolvency; and more. This 170-page report isan essential resource for all those involved in Germanprivate equity buy-outs.

• The UK LBO ManualA practical guide to structuring private equity-backed buy-outs in the United Kingdom. Written and researched byleading international law firm Ashurst, this is the first in aseries of country-specific guides that address all aspects ofprivate equity-backed buy-outs. Topics covered include: thedevelopment of the UK buy-out market; the structure ofleveraged buy-outs; documentation; taking equity; debt andsecurity; taxation aspects of LBOs; the impact of EC and UKmerger control and anti-trust rules; public to privates;structuring equity incentives for management; insolvency;and more. This 156-page report is an essential resource forall those involved in UK private equity buy-outs.

Research Guides

Cover the broader issues, themes and trends that are helping toshape the development of the private equity asset class.Consisting of in-depth analysis and comment, along with the

Appendix


212

results of surveys into the attitudes and opinions of private equityprofessionals and investors, these research-rich, multi-contributorstudies provide readers with some of the most authoritative andsubstantive comment available on private equity.

• The Guide to Private Equity Fund Investment DueDiligenceA detailed study into performing due diligence on privateequity and venture capital funds and managers designed toassist institutional investors in making investmentselections in this inefficient asset class. This 212-pageResearch Guide includes contributions from leadinginstitutional investors in private equity funds, placementagents, fund managers and investment consultants andadvisors. It combines in-depth editorial with a globaldirectory of consultants providing specialised private equityadvice to institutions, along with the results of an in-depthsurvey into limited partner attitudes towards fundinvestment due diligence.

Contributors include AlpInvest Partners N.V., CooleyGodward LLP, Dow Employees’ Pension Plan, Key CapitalCorporation, Mark Weisdorf Associates Ltd., PacificCorporate Group LLC, Pantheon Ventures, PensionConsulting Alliance Inc., Probitas Partners, Proskauer RoseLLP, SJ Berwin, VCM Venture Capital Management GmbH,Watson Wyatt & Company.

• The Guide to Private Equity FundraisingA complete and in-depth examination of all the issuessurrounding private equity fundraising. This Research Guideincludes contributions from leading general partners,private equity placement agents, legal advisors and limitedpartners. It combines expert editorial from leading marketpractitioners with the results of two surveys of limitedpartners on the topics of fund terms and conditions andinvestor relations, alongside a number of unique casestudies of actual recent fundraisings.

Contributors include Arsenal Capital Partners, ATP PrivateEquity Partners, Campbell Lutyens & Co. Limited, CliffordChance LLP, Helix Associates, Indigo Capital Limited,Macfarlanes, Mezzanine Management UK Limited, MontaguPrivate Equity Limited, Monument Group, MVision PrivateEquity Advisers Limited, Odlander, Fredrikson & Co AB, SJBerwin.

• Routes to LiquidityA detailed study of how liquidity is being brought to theasset class. This 224-page Research Guide includescontributions from leading players in the liquidity field,combining in-depth editorial with a global directory ofsecondary buyers and advisors, along with the results of aunique survey into the attitudes towards the secondarymarket of buyers, sellers and GPs.

Contributors include Camelot Group, Campbell Lutyens,Capital Dynamics, Cogent Partners, Coller Capital, Debevoise& Plimpton, Deutsche Bank, Goldman Sachs, GreenparkCapital, Landmark Partners, Lexington Partners, LGT CapitalPartners, London Business School, New York PrivatePlacement Network, Pantheon Ventures, Partners Group,Paul Capital Partners, Pomona Capital, Probitas Partners,Schroder Ventures International Investment Trust (now SVGCapital plc), SJ Berwin, Standard & Poor’s and Vision Capital.

If you have any queries about Private Equity International’scurrent and forthcoming research publications please contactus on +44 (0)20 7566 5444.

A Guide to Private Equity Fund Placement Specialists


ppa specialists

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