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Anyone out there using Blue Flame AI? Any thoughts or other alternatives? Specifically in the PE context....

The issue is the S&P 500 is almost all the Mag 7. So saying that 7 tech stocks outperformed PE is 100% right. The issue is that 7 tech stocks aren't exactly a diversified portfolio or a safe go forward plan. Chart from Goldman.

First, it is always the case that some firms under perform and aren't going to earn a ton of carry. I know guys that worked at Sun for well over a decade and never really made a lot of carry. At one point during the GFC, TPG had a fund where not a single investment had any

Private equity isn't one thing. Blackstone and a $250M first time fund have very little in common. A deep value investor like Atlas has very little in common with a growth investor like Thoma Bravo....

This is 100% wrong. Creating a regulated stable coin that mandates buying treasuries reinforces the dollar ecosystem. There are going to be stable coins. Lets make sure they are properly regulated and reinforce the dollar.

This is an interesting point. A couple of thoughts. First, is investing really about strategy? Ideas are easy, execution is everything. If you get high quality execution I am not sure that strategy is all that critical. Second, what academic research has there been in the

This doesn’t sound right to me at all. First, raising and actually getting it raised are two very different things. So before we come to some conclusion let’s see if they actually get it done. Second, not sure what it means that none of them have been successful. If you mean

I don't know about this.... There are PE funds that believe in really paying up for the best quality executives. Their view is that management is so important that the extra comp is almost always worth the value. Almost everyone else at least believes in paying market. And

In my experience management incentive pools and the percentage that CEOs get has remained pretty similar over time. I think the biggest change is in structure. Pools have become simpler over time. Less performance vesting and preferred returns. Our current structure is 10% of

Some interesting data from PJT Partners. Even the pre GFC vintages ended up with almost double digit returns. 21/22 paid up but don't have nearly the downturn that those vintages had. 12-19 returns look very good and have enough realized at this point that they are almost

I strongly believe in the future of nuclear energy. The current issue is really regulatory. The government has made it so hard to build and then run these facilities that the economics are difficult. But the large tech businesses need massive amounts of energy to deliver AI.

A sell side QofE is a good exercise for sellers to make sure that the numbers they are presenting are correct. I will say that as a buyer they don't give me a lot of faith given the number of just awful QofEs we see. The worst I ever saw had massive tax fraud. When we got on

It sort of depends on what you mean by "properly in order". The vast majority of family/founder owned businesses don't really focus on month to month financials. A little bit of lumpiness in the numbers doesn't really bother them. They aren't very good at matching revenues and

Not sure where this data comes from. We are YTD running at 15% EBITDA margins. And that is in a industrials & business services portfolio with an average entry multiple of 6.5x. I would have to imagine that PE as an asset class is higher margin than we are...

This is just non-sense. Below are the pricing for secondary buyout trades in 2024. Sure there is a discount. But it is pretty small. I also have a hypothesis that most sellers are selling the GPs they no longer want to work with. So likely there is a bias towards the less

This is old school private equity. If all you are doing is signing the purchase agreement and sitting on the board you are cooked. That isn't enough to compete in today's market.

I don't think this is true at all. When we are doing a roll-up we are looking to buy very specific businesses in very specific geographies. If your business fits the buy box we are 100% willing to pay a market price. It is also important to understand that time is of the

As you get bigger you need a lot more process and systems. Things that used to happen naturally now need to be planned. As an example, communications and feedback used to happen naturally in the flow of business. Now you need a plan and process. In many small businesses the

Some interesting data from Kirkland. HSR filing way down since liberation day. Does feel like the market is recovering and has gotten better each month since March. But the data is interesting....

My experience with the LMM is also that about half of deals close. This is generally value deals so maybe a bit of a lower close rate than the market overall. But my sense is even in the true MM (EBITDA > $20M) with high quality MM banks you still have 1/3 of deals under LOI