Angel Groups: Giving Startups Their Wings

Entrepreneurs and the companies they start are pivotal for stimulating the innovation needed for economies to grow and societies to progress. We all know the stories of the founders who built their global companies out of a single-car garage or their freshman dorm room, but the individuals and groups that provided them the needed money in the beginning are less often discussed. In this post, Samuel Holt explores the angels and angels groups who provide critically important funding in a company’s early days, and discusses some of the best practices that help these financiers succeed.

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An Intolerance of Failure? Evidence from U.S. Private Equity

In a recently published study funded by the John S. and James L. Knight Foundation, we follow up on our landmark 2018 work that offered the first comprehensive look at diverse ownership of asset management firms. In this updated analysis, we quantify the representation of women- and minority-owned firms in the U.S. asset management industry, and explore in more depth the performance of diverse-owned funds. We find that these groups perform just as well as the industry overall, despite accounting for only a small percentage of firms.

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Private Equity Findings Issue 15

Bella Private Markets collaborated with the Coller Research Institute to produce the fifteenth issue of Private Equity Findings, a publication that curates the most important cutting-edge academic research on private equity and brings together leading practitioners to discuss its implications. This issue examines how PE-sponsored management practices impact portfolio company performance, PE’s ability to time markets, and whether the VC industry has adopted a “spray and pray” approach to investing that has changed the early-stage funding landscape, among other topics.

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Specialization and Diversification

One of the key themes of managing an investment portfolio is the tension between seeking higher returns by focusing efforts on a narrow specialization and reducing risk by diversifying. This is seldom more true than in PE, which requires its own nuanced framework for thinking about the problem. In this post, Rahat Dewan considers how to build just such a framework, touching on what research has to say, including some of the recent studies that Bella Private Markets has conducted.

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2018 Diverse Asset Management Study

In a recently published study funded by the Knight Foundation, we follow up on our landmark 2018 work that offered the first comprehensive look at diverse ownership of asset management firms. In this updated analysis, we quantify the representation of women- and minority-owned firms in the U.S. asset management industry, and explore in more depth the performance of diverse-owned funds. We find that these groups perform just as well as the industry overall, despite accounting for only a small percentage of firms.

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Value-added services: A modern approach to PE investing

In the face of a deluge of capital, GPs are seeking ways to gain a competitive edge in attracting top investors and top portfolio companies. To this end, many VC firms are increasingly trying to differentiate themselves by providing value added services (VAS). In this post, Jake Ledbetter discusses some of our recent research into this phenomenon and explores its staying power.

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Independent sponsors in the modern PE industry

In today's crowded PE industry, fund managers are facing pressure to deploy capital in a hot market while still achieving the outperformance PE is known for. But LPs are becoming frustrated with stagnating returns and high fees, leading some to question the classic PE fund structure itself. Could this moment in time be an opportunity for alternative PE models to flourish? In this post, Alex Billias considers the rise of the independent sponsor model, and how its potential benefits to both fund managers and LPs may .make it particularly well-suited to the current PE environment.

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Monte Carlo-style simulation analysis for private equity portfolio modeling

In this blog post, Alex Billias and Jake Ledbetter discuss how Bella Private Markets uses Monte Carlo- style simulation methods and historical data to model the cash flows and valuations of portfolios of private equity funds. They also explore how investors and fund managers alike can benefit from this powerful, customized approach to modeling risk and returns.

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Private Equity Findings Issue 14

Bella Private Markets collaborated with the Coller Research Institute to produce the fourteenth issue of Private Equity Findings, a publication that curates the most important cutting-edge academic research on private equity and brings together leading practitioners to discuss its implications. This issue examines whether the current size of the private equity industry poses a risk to the wider economy, "unicorn" valuations, how to value originality in companies, the rise of co-investments, and the relative performance of funds-of-funds, among other topics.

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Why should private equity care about social impact?

While critics of the private equity industry lambaste it as being exploitative and short-sighted, in reality PE firms are increasingly turning their attention to social impact and long-term value creation. Initially spurred on by asset owners and shifting industry dynamics, fund managers are now finding that ESG considerations can also help boost fund returns. Furthermore, PE investors are uniquely positioned to enact impactful positive changes in their portfolio companies. In this Bella Insight, Shonali Pal explores these topics and shares some of the exciting ways that Bella clients have been at the forefront of this trend.

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