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Pop goes the VC bubble and boom go VC secondaries?

Apr 10, 2019 11:56:30 AM / by palico posted in Palico PE Insights

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Speculation continues to mount as to whether we are amidst a VC bubble. Certainly, we are not the first to say this and, in some ways, we might stop asking if we are witnessing a VC bubble but rather when this bubble will pop and to what end this may lead to a jump in VC secondary transactions.

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Small PE Secondaries Find Their Place Even as Average Deal Size Increases

Mar 27, 2019 6:35:43 PM / by palico posted in Palico PE Insights

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Secondary Market Grows Four-Fold in a Decade

The secondary market for closed private equity funds looks set for its best year ever. Following last year’s $70 billion to $80 billion all-time volume high (surpassing 2017’s record year by as much as 47 percent), press reports note that at the current pace, transactions in the first three months of 2019 will amount to $18 billion, well ahead of last year’s first quarter record of $13 billion. The secondary market has certainly come a long way. A decade ago annual market volume amounted to some $16 billion, less than a fourth of current levels. The largest fund ten years ago, Coller International Capital Partners V (raised in 2007) collected some $4.8 billion - twice the amount of its previous fund, but just about a fourth of Ardian’s most recent fund.

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Placing your bets on a young buck: why it pays to invest in emerging managers

Feb 21, 2019 3:39:22 PM / by palico posted in Palico PE Insights

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We’ve said it before and so have countless other reports in the industry, emerging managers, officially classified as first and second-time funds, outperform time and time again. However, the negative perception of these managers still weighs heavily on their backs, impeding their access to capital distributions from large investors, namely institutional investors. The idea behind the reluctance is the perceived high-risk nature of allocating funds with an emerging manager who has little to no independent track record. In the case of first-time funds, this has stopped roughly half of all private equity investors and, according to Preqin, 60 percent of all institutional investors from investing due to in-house policies barring the action.

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German Q&A: Christian Czernich, CEO, Founder und Managing Partner bei Round2 Capital Partners

Feb 15, 2019 4:45:17 PM / by palico posted in Palico Q&A

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Christian Czernich ist CEO, Founder und Managing Partner bei Round2 Capital Partners. Im Gespräch mit Palico haben wir uns über das Revenue-based Financing ausgetauscht und diskutiert inwieweit dieses eine Antwort auf die gegenwärtigen Herausforderungen für junge Tech-Unternehmen bieten kann.

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Will 2019 be the Year of Politically Motivated Secondary Sales?

Feb 11, 2019 11:18:06 AM / by palico posted in Palico PE Insights

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senate

Volume in the secondary market for closed private equity funds soared last year as much as 47 percent with record annual aggregate value estimates in this opaque market ranging from $70 to $80 billion according to various sources. Given historically attractive pricing for sellers and the unprecedented sums earmarked for secondary purchases, record volume makes sense. The average transaction on the private equity secondary market stands at 102.5 percent of fund net asset value, according to a recent Palico marketplace survey (sent to members last month) – the highest level we’ve ever recorded. Meanwhile, estimates from industry intermediaries for committed but unspent capital in the secondaries market are at all-time highs of between $180 and $200 billion.

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Secondary Pricing List - Secondary Funds Sell at Par or Better Despite Falling Stock Prices

Jan 17, 2019 8:05:21 PM / by palico posted in Palico PE Insights

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The typical transaction on the private equity secondary market is valued at 102.5 percent of net asset value in terms of mean, with the median at 101 percent, according to a Palico survey of limited partners who’ve successfully purchased stakes in closed funds over the last six months. This is the highest pricing Palico has recorded since we began tracking secondary transactions in March 2017. This latest survey covers 30 funds of all types from real assets to private debt, buyout and venture.

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PE Secondaries: Liquidity! Liquidity! Liquidity!

Dec 11, 2018 9:54:47 PM / by palico posted in Palico PE Insights

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Liquidity may have been hard to come by for PE investors in the 90s, but almost thirty years down the road it has become a demand. Regardless of the numerous reasons LPs have cited for selling their stakes, one thing is clear, they are less eager to wait for returns. So one can ask: are LPs going schizo? They’ve been investing in the PE market for years knowing of its illiquid state and 10-year plus lifecycles, so is waiting a lost art? And especially, what is fueling their growing desire to cash out?

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Q&A: Civilization Ventures Raises Capital on Palico

Nov 29, 2018 4:19:08 PM / by palico posted in Palico Q&A

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Shahram Seyedin-Noor is the Founder and General Partner of Civilization Ventures, a San Francisco-based venture capital fund investing at the intersection of health tech and synthetic biology. We recently caught up with Shahram to discuss his fund’s unique value proposition and his experience successfully leveraging the Palico marketplace.

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Palico's Digital Marketplace is a Spinoff Mecca

Mar 30, 2018 10:22:28 AM / by palico posted in Palico In Focus, V2

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Palico

Out of nearly 300 opportunities currently listed in Palico's marketplace, more than 40 percent are first-time fundraisings. The vast majority of those funds are run by private equity veterans creating their own firms from scratch. Among these, many were founded by teams of highly experienced managers coming together for the first time from disparate fund groups. Yet two out of five are spinoffs, run by exceptionally close-knit teams that have been investing together for years and who have collectively broken free from larger organizations. The average first-time fund is now outperforming the average later-generation fund, but spinoffs - due to their demonstrated cohesiveness - generate some of the greatest excitement among investors.

Palico's Rich Range of Spinoffs

Palico is not only a great place to find first-time private equity funds, it's a mecca for investors seeking to commit to promising spinoff teams. As erstwhile subsets of larger teams, spinoff groups are frequently specialists, active in less crowded sectors than the historic core of private equity - buyouts. Indeed, only 11 percent of Palico's spinoff fundraisings are focused on the buyout market. The variety of spinoff strategies on Palico includes private credit, turnaround, real estate and a host of growth niches. A third of Palico's spinoff fundraisings are also focused on emerging markets, far from the world's highly competitive money centers.

Bringing Alternative Private Equity to Investors

In today's mature private equity fund market, where a record 3,129 funds are seeking capital - some 42 percent more than just five years ago - it can be hard for limited partners to find the time to source and evaluate promising spinoffs, let alone the broader universe of first-time funds. Yet Palico's digital marketplace brings a wide choice of promising smaller and specialized managers of all types to the desktops and smart devices of limited partner firms in every region of the world. In 2017, those LPs invested $227 million in primary fundraisings and secondaries via Palico's digital marketplace, overwhelmingly in smaller and more specialized funds. Palico is making private equity 'alternative' again, even as the overall industry becomes mainstream.

"It's great to push a button and see everything that's out there. Palico helps me do my job better."

Sabina Eder, Bank Austria

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PALICO RAISES $7.3 MILLION IN THIRD ROUND OF FUNDRAISING

May 18, 2015 7:06:37 PM / by palico posted in Palico Press Releases, V2

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The first global online marketplace for the private equity fund community will use the new capital to strengthen its market leading position.

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