Keep pulling the thread on Mario Giannini.
The private equity industry hypocritically champions the transformative power of technology and data for its portfolio companies but fails to invest in or believe in its application for its own operations.
The performance spread between middle-market private equity firms has increased over the last 10 years, contrary to the expectation that a more efficient market would lead to narrower return dispersion.
LP over-allocation and the "denominator effect" is one of the top three biggest issues facing the private markets as of 2022.
The collision between LPs being overallocated and GPs raising larger funds is predicted to cause a "reasonable shakeout" in the private equity industry within the next two to three years.
Mario Giannini predicts the venture capital industry is entering a difficult period that could last for five years.
The Russian invasion of Ukraine will accelerate Europe's and the world's transition away from fossil fuels, driving significant investment in energy transformation.
The high-net-worth investor channel is expected to become a huge participant and source of capital for the private markets.
Succession planning is a significant concern for middle-market private equity firms, many of which are dominated by a few individuals and may not have robust transition plans.
Mario Giannini believes that portfolio construction accounts for at least 50% of returns in private markets, a factor he argues is underappreciated by most investors.
Mario Giannini predicts that within 10 to 15 years, institutional investment portfolios will, on average, be allocated 50% to private markets and 50% to public markets.
The claim by private equity firms to have "proprietary deal flow" is a myth, as sustained proprietary flow is non-existent because sellers are broadly aware of private equity as a financing option.
Historically, 30% of private equity deals have been exited via sales to another general partner, and the returns on these "GP to GP" deals are statistically the same as returns from other exit types.