Analyzing the Impact of Scale and Complexity in Private Markets

Welcome back to the Alt Goes Mainstream podcast.

Today’s episode features a masterclass in private markets from a guest who has seen it all.

Jim Strang is a deeply experienced private equity professional who has been part of the industry as a GP, LP, investor, consultant, and now a teacher, board member, and advisor to a number of firms.

I’d probably have to spend a good few pages going through everything that Jim has done and is currently doing in private markets. He’s a practitioner and a teacher, an expert and an operator. After an illustrious career that was punctuated as Chairman EMEA of Hamilton Lane, one of the largest LPs in private markets globally, he now serves in a number of board and advisor roles, which include Chairman of the Board at HgCapital Trust plc, Senior Advisor to CVC Capital Partners, Advisor at Bain & Company, and Director at Pictet Alternative Advisors.

Jim and I had a fascinating conversation about the evolution of private markets and what the future holds for large and small funds alike, as well as LPs. We discussed:

• The step function changes that take private markets from $15T to $30T of AUM.
• Why traditional asset managers may struggle to replicate the capabilities of alternative asset managers in private markets.
• The importance of partnerships having a clear ambition and alignment if they want to build a scaled platform.
• The challenges that managers in the middle face as large platforms and specialist managers are the differentiated firms in the eyes of LPs.
• Why GPs need to find innovative solutions to address the needs of different types of investors.
• Why building a strong brand is crucial to success in the wealth channel.

Thanks Jim for coming on the show to share your wisdom and experience on private markets.

This episode of Alt Goes Mainstream is brought to you by Ultimus Fund Solutions, a leading full-service fund administrator for asset managers in private and public markets. As private markets continue to move into the mainstream, the industry requires infrastructure solutions that help funds and investors keep pace. In an increasingly sophisticated financial marketplace, investment managers must navigate a growing array of challenges: elaborate fund structures, specialized strategies, evolving compliance requirements, a growing need for sophisticated reporting, and intensifying demands for transparency. 

To assist with these challenging opportunities, more and more fund sponsors and asset managers are turning to Ultimus, a leading service provider that blends high tech and high touch in unique and customized fund administration and middle office solutions for a diverse and growing universe of over 450 clients and 1,800 funds, representing $500 billion assets under administration, all handled by a team of over 1,000 professionals. Ultimus offers a wide range of capabilities across registered funds, private funds and public plans, as well as outsourced middle office services. Delivering operational excellence, Ultimus helps firms manage the ever-changing regulatory environment while meeting the needs of their institutional and retail investors. Ultimus provides comprehensive operational support and fund governance services to help managers successfully launch retail alternative products. 

Visit www.ultimusfundsolutions.com to learn more about Ultimus’ technology enhanced services and solutions or contact Ultimus Executive Vice President of Business Development Gary Harris on email at gharris@ultimusfundsolutions.com.

We thank Ultimus for their support of alts going mainstream.

Show Notes

00:00 Introduction and Sponsor Message

02:06 Podcast Theme Song

02:44 Guest Introduction: Jim Strang

02:52 Jim Strang's Career Overview

05:35 State of Private Markets: Challenges and Opportunities

08:04 Fundraising Dynamics in Private Equity

11:25 European Private Equity: Evolution and Insights

15:01 Scaling Challenges and Ambitions in Private Equity

25:41 Technology and Innovation in Private Equity

32:47 Challenges in Organizational Analysis

33:56 Psychological Assessments in Investment Decisions

35:48 Effective Questioning Techniques for LPs

36:29 Transparency and Culture in Investment Firms

37:34 Evolution of Asset Management

38:41 Public vs. Private Asset Managers

40:27 Generational Shifts in Private Equity Firms

44:12 Growth and Democratization of Private Markets

48:40 Liquidity Challenges in Private Markets

54:45 Quick Fire Round: Insights on Private Markets

01:00:10 Entertainment Investments: Music Royalties and Sports

01:04:02 Conclusion and Final Thoughts