Getting to know private equity sources
Wednesday, 22nd August 2012
Like many information-intensive industries, the private equity industry offers a range of sources, with a range of price tags -- from free to costly. This is a short version of a longer FreePint Subscription article on the same topic.
The longer article provides more detail on specific suppliers and how to vet them; identifying the best tool for a particular task; and developing skills for creative approaches to PE research. FreePint Subscribers can login to view the article now.
The private equity (PE) and venture capital (VC) industries are information intensive, generating numerous data on companies, funds, investment firms, and investment performance. These data are typically available on a subscription-basis, and sold to industry participants for due diligence, competitive intelligence, analysis, and business development purposes. Several publishers and industry associations also provide market information for free.
Fund Performance Data
Fund performance data is the most difficult type of PE industry information to obtain. They are typically used by financiers and fund managers for several purposes, including establishing performance benchmarks, portfolio analysis, and cash flow modeling. Typically, publishers of this information (such as Thomson Reuters and Preqin) collect these data through direct survey and regulatory filings.
Fund, firm and portfolio company profiles
Fund, firm and portfolio company profiles can be used for due diligence purposes, as well as to identify new investment leads. Private equity fund profiles typically include the fund’s investment focus, fund size, and previous investments. Company profiles may include financial metrics, such as EBITDA, as well as management information and detailed information on a company’s products and services. CBInsights is a good example.
News and deals data
Private equity news and deals data sources help industry professionals keep up to date on the latest deals, management moves, and regulatory changes in the PE and VC industries. The new Bloomberg Briefs private equity newsletter is a good example.
Several organisations, such as the US-based Private Equity and Growth Capital Council and the international Emerging Markets Venture Capital Association, offer PE industry information for free. This includes information publishers, who may produce research and reports for marketing purposes, and also industry associations, who publish reports for advocacy and marketing purposes. Free research tends to provide high-level, aggregate information on industry performance as a whole, rather than granular, company-level information.
Finally, along with news and data, growing a personal network is also required for effective PE and VC fundraising. Social networking sites dedicated to the investment industry, such as Palico, may provide users additional communication strategies above networking at conferences.