By Mike Nugent, CEO & Co-Founder of Bison
The National Venture Capital Association recently released the Q2 2014 VC Fundraising statistics, and the headline was “Number of Venture Capital Funds That Raised Capital Hits Seven Year High In Second Quarter.” This triggered two thoughts for me: Read the rest of this entry »
Last week, Bison helped the NY Post analyze the New York City pensions’ private equity portfolio. Bison analyzed the roughly 160 US pension funds’ that we currently track to see who has constructed the best portfolio of funds. Read the rest of this entry »
A few weeks ago, Tom Tunguz at Redpoint posted an interesting presentation he gave to the Wharton Entrepreneurship Workshop. In it, he analyzes the state of the US venture capital market and, specifically, talks about what he sees as “The Five Forces Shaping the Fundraising Market.”
Investors evaluating a private equity fund initially ask for two data points: “What are the fund’s multiple and IRR?” While the two measures tell a more complete story when evaluated together, we are going to focus on the fund’s multiple in this post. Importantly, we are going to talk about a number of different multiples and how they relate to a funds performance. Read the rest of this entry »
The private equity industry has always had its own way of measuring performance. Unlike a mutual fund, investors are committing to a blind pool of capital where GPs have discretion over the timing of inflows and outflows. This is why there is a difference in how you measure performance between a private equity fund and an equity mutual fund. Analyzing multiples of invested capital and IRRs – as opposed to a time weighted rate of return on public markets – allows investors to analyze a fund’s performance relative to its peers. However, if you are looking to compare a private equity fund’s performance to the public markets, you need to calculate a public market equivalent (“PME”) return measure. There are five main PME methodologies: Read the rest of this entry »
Let us assume for a minute that performance persistence in private equity and venture capital is real. This begs the question: how do I measure performance and how do I pick winners? Read the rest of this entry »
Venture Capital is an asset class characterized by a longer time horizon as startups are nurtured from idea to business model to successful (and maybe even profitable!) business. While buyout funds typically look to exit a company in three to five years, venture funds tend to take a little longer for their portfolios to develop.
With this in mind, it is a little curious to see the National Venture Capital Association (“NVCA”) joyously announce that VC returns saw a dramatic increase in Q4 2013. Heck, they even outperformed the public markets! The VC returns were largely driven by early stage funds who saw 14% quarterly returns in Q4 2013. Bison believes the VC funds below are the primary contributors to these strong returns. Read the rest of this entry »
Big data is coming to the private markets. New datasets covering management, web traffic, media signal, fundraising, and returns are quickly being aggregated together. One startup that has recently made headlines is Mattermark. They use soft signals to quantify Momentum Scores for startups. In a recent blog post, they used this score to create synthetic portfolios for investment firms to see which firm had the strongest portfolio. This investor ranking caught our attention here at Bison since it allowed us to create a comparison with our Performance Score, which ranks firms based on historic fund performance. Read the rest of this entry »
Super Bowl, Olympics, World Series, World Cup, et cetera, et cetera. These events allow the cream of the crop to show off their skills during a prime time event. For private equity, the event of the year is the annual SuperReturn International conference held in Berlin, Germany. Through our partnership with ICBI, Bison was able to attend and in case you weren’t able to hop over to the techno capital of the world, here are some of the big themes from the conference:
Bison 