Dear Valued Member of the Moonfare Network,
Public markets have been taking it on the chin since our last newsletter. As we face the risk of recession, we explore why private equity is well equipped to not only survive but thrive during a market turmoil.
We’ll continue to share analysis and our views in the coming weeks to help you better navigate the changing macroeconomic environment. Stay tuned!
Why private equity is well placed to power through a potential recession
After a blockbuster 2021 for private markets, investors are now understandably feeling nervous and fearing we could be entering a recessionary period. While private equity is not immune from volatility, it’s still uniquely suited to survive and potentially even thrive amid economic turmoil.
Illustrating the resilience of private equity, Moonfare’s Investment Manager Pavel Ermoline highlights the recent valuation reset and record amount of dry powder that fund managers have at their disposal. “This offers attractive opportunities for recently and newly launched funds, as these will evolve in a healthier valuation environment,” he explained in our latest article.
“I manage my portfolio like a pension fund” - investor Joanna Dziubak in an interview with Moonfare
Joanna Dziubak is a seasoned private equity investor and a long-time user of the Moonfare platform. In an exclusive interview, she discussed current investment opportunities, her portfolio construction toolbox and her philosophy as a private markets insider.
“I am a prudent investor looking for a combination of capital appreciation and yield,” the Paris-based advisor told Moonfare. “I try to manage my personal portfolio like a pension fund but more skewed towards risks with which I’m comfortable, such as private equity.”
How fund managers create value by improving companies – 5 case studies
The competition for the best deals in private equity is fierce. As a result, fund managers are backing away from financial engineering in favour of operational improvements, which they see as more replicable and sustainable ways to create value and boost returns for investors. Indeed, per Goldman Sachs, operational improvements now account for over 50% of PE's sources of value creation.
Here are five distinct case studies that delve more deeply into the levers of operational improvement strategies:
📍Carlyle’s revamping of AZ-EM, a global leader in speciality chemicals.
📍Cinven’s support for product diversification at Phadia.
📍Summit Partners’ example of a buy-and-build.
📍CVC giving an ESG boost to a Polish retailer.
📍Bain Capital and KPMG are creating value with digitalisation.
Moonfare and Fidelity International present the case for expanding access to private markets
Moonfare and Fidelity International joined forces at the recent Private Wealth UK Spring Forum in London. Speaking to senior wealth managers and discretionary portfolio managers, Moonfare’s Partnerships Manager Ed Cotton and Head of Investments in Europe Sweta Chattopadhyay, along with Fidelity Sales Director Paul Heselden, honed in on the importance of seizing new opportunities to access private market funds.
“They provide not only diversification benefits, but are also a vital driver of returns,” explained Cotton. The group also discussed the importance of manager selection in private markets, given the extreme disparity dispersion of returns between top- and bottom-quartile funds and the acute consistency of top performers.
Interested in the exciting world of private markets and the exclusive investment opportunities it offers? Check our selection of top-tier private equity funds by logging on to the Moonfare platform.
If you have any questions, please reach out to one of our representatives. We will be happy to assist you.
Moonfare does not make investment recommendations and no communication, through this website or otherwise should be construed as a recommendation of any security. Alternative investments in private placements are highly illiquid, speculative, and involve a high degree of risk. Past performance is not indicative of future results. Investors may not get back their money originally invested and those who cannot afford to lose their entire investment should not invest. Prior to investing, carefully consider the respective fund documentation for details about potential risks, charges, and expenses. The value of an investment may go down as well as up. An investment in a private equity ("PE") fund or investment vehicle is not the same as a deposit with a banking institution. Investors receive illiquid and/or restricted membership interests that may be subject to holding period requirements and/or liquidity concerns. Investors who cannot hold an investment for the long term (at least 10 years) should not invest. In the most sensible investment strategy for PE investing, PE should only be part of your overall investment portfolio. The PE portion of your portfolio may include a balanced portfolio of different PE funds. For additional information, including Moonfare's affiliates, please see here.