The primary objective of the Fundco manager selection process is to identify funds that best serve the needs of our clients – Finnish professional investors looking to diversify their investments in private markets globally and seeking to improve returns in their portfolios. Our entire manager selection process is framed by the prevailing economic environment and its impact on the investment opportunity set faced by fund managers.
We acknowledge that the rapid rise in interest rates and the materialization of multiple geopolitical risks present significant challenges for today’s fund managers. Investment strategies that worked during the era of cheap money and a more stable geopolitical environment are unlikely to work in the future. This shift in the global investment backdrop puts further emphasis on the importance of fund selection.
Buyout funds are the largest segment of the investable private asset universe, with a total of $3.9 trillion assets under management, making up 26% of the private asset market globally. As a result, they are typically the core holding within private asset portfolios, surrounded by satellite investments e.g. in Growth Equity, Venture Capital, Private Debt, and Private Real Estate. Fundco recognizes Buyout as the core allocation in their portfolios because the depth and maturity of capital markets in this segment provide skilled managers with significant opportunities to build diversified portfolios of global companies with attractive risk-adjusted returns for investors
Target Funds
Our selection process for Fundco Buyout Funds is based on the following key criteria:
1. Control. The target fund mostly invests in large market-capitalization companies, acquiring full control. This ensures that the fund managers can implement necessary actions in the portfolio companies quickly and efficiently.
2. Track record. The investment team must have a proven track record of successful investments and exits in different macroeconomic environments generating outperformance against public and private market benchmarks.
3. Investment strategy. The target fund’s investment strategy cannot rely excessively on the use of leverage. Instead, the fund managers must be able to improve the profitability and positioning of its portfolio companies.
4. Resources. The target fund manager must be a well-resourced global operator that is able to execute all phases of the investment process across different market environments.
Important notice: The information presented here is solely for informational purposes. Fundco does not offer investment advice. Any content provided should not be interpreted as legal, tax, investment, financial, or any other form of advice. If you have uncertainties, it is recommended to seek guidance from an authorized financial advisor. Past performance does not guarantee future returns. Investing entails risk, and you should only invest funds you are willing to potentially lose entirely. Private equity investments carry high risks, and there may be limited protection in case of adverse events. Eligibility criteria apply.