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Fund Investments
In evaluating managers, we place a heavy emphasis on the principals’ integrity, commitment, relevant experience, team rapport and track record. Through our disciplined due diligence process, we thoroughly examine the fund’s governance, organizational and incentive structure, decision-making process and ability to source opportunities and exit at attractive rates of return. We also examine the team’s demonstrated ability to build effective companies that have been proven to deliver real value.
In evaluating the strategy and investment focus of a manager, we consider the attractiveness of the sector and the team’s record of taking advantage of opportunities in the target sector. We assess the team’s prior funds and the size and resources of the current fund relative to prior funds. We have and will continue to invest in first-time funds, but not first-time private equity investors. We pay particular attention to the principals' record and history of working together as a team.
Finally, we examine the terms of the partnership and the alignment of interests between Limited Partners and the General Partners. Among other things, we consider the handling of potential conflicts, the ability for limited partners to exercise control in extraordinary circumstances, key man provisions, distribution policy, the allocation of profits and losses, transaction fees and the burden of operating expenses and fees on the fund.
We consider our philosophy of investing with managers who have demonstrated competitive advantages in our evaluation of investment opportunities, including re-investments with general partners with whom we already have a relationship.
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