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Dear MCG… Which foot is my best?

by The Drawdown 16 June 2017

Dear MCG,

I’ve just started in the IR department of a fairly well-known lower mid-market private equity house. We’ve now invested in 26 SMEs across two and a bit funds and I’ve been asked to prepare some case studies for an investor roadshow for Fund III. Where do I start? Do I just pick the strongest returns?

Sticking case studies in a presentation is easy. Sticking the RIGHT ones in is not so simple. The temptation is to pick those impressive deals with the strongest returns, or those fresh ones that were exited most recently. Whilst these are not terrible strategies, there are more factors to consider.

  • Is the case study illustrative? Does it bring to life one or more of the key differentiators that sets your fund apart? Does it tell a story that highlights what makes you unique? Presented correctly, these are the stories that will get your fund raised.
  • Is the case study representative? In other words, there should be examples that describe a typical deal for the fund, with typical outcomes. This doesn’t mean that your case studies should just be a showcase of mediocrity – but it’s misleading (and, ultimately, futile) to only share the outliers with investors.
  • Is the case study persuasive? Are your firm’s achievements endorsed by the management team? Does it include testimonials that are both enthusiastic and specific? Is there data included to back up the statements you make.
  • Is your selection comprehensive? Don’t forget the portfolio effect. Focus too much attention on one strength and you risk looking one dimensional. Make sure your case studies, as a portfolio, illustrate all of the qualities you want to impress upon an investor.

So if you can make sure that the portfolio of case studies you pick is impressive, fresh, illustrative, representative and comprehensive, you’ll have LPs eating out of your hand. Simple, really.

MCG (Matthew Craig-Greene) is Managing Director | IR& Marketing for MJ Hudson, the asset management consultancy. He can be reached at matthew.craig-greene@mjhudson.com

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