Capital Allocators – Inside the Institutional Investment Industry Mario Giannini & John Toomey – Private Equity Panel (Capital Allocators EP.309)
Apr 17, 2023
Mario Giannini, CEO of Hamilton Lane, and John Toomey from HarbourVest are giants in private equity, managing over $200 billion collectively. They discuss the health of portfolio companies and the impact of current economic uncertainties like inflation and geopolitical risks. The duo analyzes trends in fundraising, the dynamics of secondary markets, and the growing importance of ESG factors. They also explore innovative investment strategies, the role of new capital sources, and the industry's need for evolution and broader acceptance.
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Market Uncertainty
- The current market is uncertain, similar to 2008, but with less clarity.
- The future of inflation, interest rates, and the economy is unpredictable, creating investment challenges.
Private Equity Valuations
- Private equity valuations are accurate, reflecting strong underlying company performance.
- Private equity outperforms public equity because of better governance and earnings.
Impact of Financing Markets
- Venture capital will see failures due to reduced liquidity, but strong companies will thrive.
- Higher interest rates, while impactful, aren't catastrophic for private equity, which has operated successfully in similar environments.