Fundraising in a difficult environment
We don’t have any special fundraising skills. The decisive factors were probably the positioning of our fund strategy in an interesting niche — special situations in German-speaking countries — and the relatively small size of the fund.
In the eyes of leading institutional investors, we have become the recognized leader in our niche over the past 3 years, and being a leader makes life easier than competing broadly. We managed to draw down the funds from the last fund very quickly, which is usually the core problem for teams in our market segment. We have an attractive portfolio to show, have built a team of top-notch people, and have kept all aspects of our business stable and predictable for investors from the beginning.
Very strong! Investors know that they are “in the driver’s seat” again, because there is a wave of fundraising coming up, numerous funds need money. The requirements for due diligence have therefore become considerably more stringent. For undifferentiated strategies or even for teams that are not — or in the eyes of investors as of today are no longer — market leaders, the duration of fundraising is extended.
The ideal of the resource-saving “first, final and only” closing, as we were just granted, will probably become rarer in 2012. Investor interest is also focusing more on funds operating regionally or strategically in a niche, which can demonstrate a long track record for their strategy. Finally, the management structures of the teams below partner level are now increasingly analyzed by investors and considered important. So we are moving in the private equity business towards a more mature, professional industry.