Читать книгу The Private Equity Toolkit - Tamara Sakovska - Страница 43

Opportunistic deal sourcing features an interesting paradox: in order to find more high-quality deals, you need to focus on fewer segments of the market. Cast your net wide, and you risk sinking in deal entropy of random sectors, business models, endless meetings and follow-ups.

When I started working in private equity, most large firms had a broad mandate that could roughly be described as follows: “We are sector agnostic investors looking to back market-leading companies with recurring revenue streams and sustainable margins led by experienced management teams with a proven track record. We like investing in companies with strong brands and solid customer relationships.” Clearly, this acquisition strategy is too broad and would no longer be successful in today's significantly more competitive market.

It is far more effective to narrow your scope and cherry-pick the kind of deals your fund wants to do. What are some of the specific investment themes you have been developing? Is there a differentiated type of deal that your fund excels in? Do you have a good track record in a particular sector?

Ideally, you will focus on just a few investment niches where your firm has a strong competitive advantage, such as unique knowledge gained through existing investments, deep industry expertise or access to sector experts. If you work in a sector team, you might consider exploring specific subsectors within your industry. Once you have a clear point of view about what kind of deals you are targeting, stick to your investment focus and decline everything else coming your way.

By the way, I can tell you from my experience, this is a hard thing to do in practice. If you are intellectually curious or generally suffer from FOMO (“Fear of Missing Out”), it will take some effort to stay disciplined and not veer off your chosen focus.