Fundraising: Sky’s The Limit

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Private equity fundraising had a banner year in 2013 — and all signs point to growing appetite from LPs in 2014.

Graham Winfrey

…“The lower mid-market space is still dominated by this 90-10 phenomenon, which means that 90 percent of the capital is going to 10 percent of the GPs, and the other 90 percent of the GPs are struggling with less certainty as to where their capital will come from.”

At the larger end of the market, however, the improving macro picture has attracted interest from LPs both in Europe and further afield, according to Alan Pardee, managing partner of placement agent Mercury Capital Advisors.

“The intention of US investors to invest in Europe has returned,” he says. “We’re getting questions from Asia and the US about investing in Europe, so there does appear to be a return to focus on Europe. We’ll be launching a couple of European funds in the near term.”

This rebounding investor confidence in Europe stands in stark contrast to sentiment during the two preceding years.

“Two years ago, if one invested in Europe, one wasn’t exactly sure what currency one would end up holding out the other side,” Pardee says. “Those issues are all gone. The economies have, generally speaking, stabilized. That doesn’t mean they’re growing, but we’re no longer worrying about whether somebody is catching a falling knife [if they invest] in Europe.”…



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