| Over 200 private equity funds enabling a wide selection of investment opportunities
Wide range and number of private equity managers seeking to raise new funds in which to invest over the next few years
High level of control
The amount or commitment to a fund is agreed at the outset and the fund has a predetermined investment life
Self liquidating fund structure
Private equity funds are directly accountable to you
Many private equity fund managers take a position on the board of the company in which they invest to keep in close contact with the companies' development
Private equity funds managed by most BVCA members have a high level of expertise and quality deal flow.
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Need for staff to achieve and maintain a good knowledge of private equity fund managers, fund raisings, portfolio content, performance, etc
Each fund's performance is generally reported quarterly or half yearly. More regular valuations are not usually available
Minimum level of investment may apply.
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| Performance measurable on a daily basis
Liquidity
Many investment trust managers take a position on the board of the company in which they invest to keep in close contact with the companies' development
Investment trusts managed by BVCA members have a high level of expertise and quality deal flow.
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Spread of investments across different managers limited - there are only about 20 UK venture and development capital investment trusts managed by BVCA members
Shares may trade at a discount to net asset value.
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| Access to a diversified private equity portfolio and therefore eliminating the risk of under-diversification
Expertise in investing in private equity funds, knowledge of private equity managers' performance, methods, portfolios, fund raising timings, etc
Delegated control, therefore saving in management time
Offers an insight into private equity fund investment for those who do not yet wish to be involved in in-house or direct fund investment
Offers a wider spread of investments for smaller investments by pension funds
The amount or commitment to a fund is agreed at the outset and the fund has a predetermined investment life
Self liquidating fund structure
May offer current direct private equity fund investors a different and wider view of the market.
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Double layer of fees (from the gatekeeper and the private equity fund manager)
Potential barrier between private equity manager and fund manager, reducing accountability
Potential conflict of interests between gatekeepers' objective advice if they are raising a fund of funds when other private equity managers are raising funds
Limited number of fund of fund managers in the UK
Longer term commitment.
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| Full control
Direct access to portfolio companies.
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Full responsibility
Requires substantial funds to achieve an adequate spread of investments
Cost and commitment: need for substantial permanent staff
Staff need expertise in negotiating and structuring the initial investment, monitoring the companies and exits
Requires access to potential investment opportunities, as success depends on quality and quantity of deal flow. The private equity industry estimates that it invests in only one in 100 proposals.
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