Public Issues, Private Issues

By | 2017-07-17T16:44:41+00:00 July 13th, 2017|Global Market Update|

What is private equity? Source: Wikipedia Private equity is an equity position in a company that isn’t publicly traded – that hasn’t been listed on a public stock exchange. For ordinary investors, there are two ways to invest in private equity. You can invest in a private equity fund, or you can give money to a friend or family member in exchange for a share of their business venture. Limited partners of Bain Capital’s Asia XI Fund are private equity investors, as are your [...]

Consider the Alternatives (Part 2)

By | 2017-07-17T12:21:45+00:00 August 31st, 2016|Global Market Update|

What are the different types of alternative investments? Muskovy Duck. Photo: Matt Lemmon. Source: Animal Photos Alternative investments can be split into two types of assets: different ways to manage, and different types of assets. I’ve written before how all wealth really depends on the economy. A huge pile of gold or a robotic factory that churns out flying cars are both worthless if they’re stranded on Mars. Alternatives are just different ways to tie in to the economy’s wealth. Within management-alternatives are private [...]

Private Markets and Public Innovation

By | 2017-07-17T12:22:09+00:00 February 10th, 2016|Global Market Update|

Is the rise of private equity stifling our productivity and competitiveness? Domenichino, “The Virgin with the Unicorn. Source: Wikipedia 20 years ago entrepreneurs all wanted to go public. The stock market was a way to make yourself and your employees rich. Start a company, develop an innovative concept, grow sales and profits by enough, and the equity markets could reward you. At least, that was the dream. But now, companies want to stay private as long as possible. They don’t want the reporting requirements [...]

Twinkie Town?

By | 2017-07-17T12:22:57+00:00 May 8th, 2015|Global Market Update|

It seems like Twinkies really can last forever. Image Source: Wikipedia Three years ago, the iconic brand ran into financial trouble. Sales were down 20% from the year before. The parent company claimed that consumers had migrated to healthier foods. Twinkies just weren’t relevant in the baked-kale / chia-seed era. In November 2012 Hostess wound down operations and sold off its assets. It looked like Twinkies had finally hit their expiration date. […]

A Tale of Three Endowments

By | 2017-07-17T12:23:14+00:00 November 6th, 2014|Global Market Update|

They were the best of returns, they were the worst of returns. Source: Last Saturday Dartmouth and Harvard fought it out on the gridiron. To the regret of all right-thinking people everywhere, the wrong team won. But for the past ten years a different competition has been playing out. And at stake is the equivalent of a small country’s GDP. […]

Back to School

By | 2017-07-17T12:23:16+00:00 October 22nd, 2014|Global Market Update|

Are colleges the ideal investors? Source: Private colleges have a long-term time horizon. Or at least, they’re supposed to. The first school endowments were agricultural estates that paid rent. A College Bursar’s job was to manage these estates by approving new leases, renewing old ones, selling timber, and appointing stewards. Sixty years ago land comprised more than half of the typical endowment. […]

Private Eyes?

By | 2014-09-18T09:42:46+00:00 August 27th, 2014|Global Market Update|

What is private equity? The Burger King / Tim Horton’s deal is being driven in part by Burger King’s majority shareholder, 3G Capital. 3G is a multi-billion dollar Brazilian private equity firm that focusses on iconic brands. They have significant stakes in Heinz, Anheuser-Busch, and America Latina Logistica, the largest railroad company in Latin America. Private equity firms have direct stakes in the firms they own. Their shares aren’t traded publically. That means their investments can be locked up for years. It’s like investing [...]

Private Lives

By | 2017-07-17T12:34:36+00:00 November 18th, 2013|Global Market Update|

Are the smartest folks in the room changing their minds? For years, Private Equity has been the holy grail of investing. With superior accountability, accountancy, business planning, and investor access, investors (who could afford it) loved what private equity could do for their portfolios. The appeal is clear: if a company’s CEO behaves badly in the morning, he’s out by the afternoon. If you question the company’s accounting, you can bring in your own accountants. A company can be run for cash or market [...]