GroveStreet Principal, Patrick Sherwood, joined other LPs and emerging GPs in a discussion on “The Evolution of the Emerging Manager” at the RFK Human Rights Compass Investors Conference. Investing in emerging managers has long been a part of GroveStreet’s approach to building private equity portfolios. Patrick outlined how GroveStreet goes about identifying and assessing talented new GPs. He also made the case for allocating to emerging managers in the current environment where there is rapid innovation in both technology and healthcare and the current macroeconomic challenges require a distinctive combination of skills and perspectives.
GroveStreet Managing Director, John Merrill, spoke at Invest Canada ‘23 on the evolution of best practices in biotech and healthcare investing. Since the inception of the firm, GroveStreet has been a consistent investor in the space backing many of the leading biotech firms just as they were being formed. While transformational innovations in biotech and healthcare present an array of compelling opportunities to long-term investors, caution and selectivity remain of paramount importance to allocators.
GroveStreet Managing Partner Frank Angella is quoted in the Wall Street Journal about the rise in healthcare venture fundraising in 2023 saying “LPs understand this is a long-cycle investment thesis and still believe the core drivers are intact.” As recent performance metrics are distorted with inconsistent valuation adjustments, there is more focus among LPs on the long-term promise of advances in biotechnology and digital health, including the application of AI and ML to ever-larger data sets to identify new treatments. Notwithstanding large reserves of dry powder, investments in early-stage startups are down as many GPs are holding out for mid-to-later-stage companies that had raised capital at lofty valuations. LPs should monitor these trends and their implications on valuations. On the ground, one thing is clear – entrepreneurs are having to do more with less, an operating environment that has historically led to strong returns. Read more here (for WSJ subscribers): https://www.wsj.com/articles/venture-fundraising-in-healthcare-rises-as-investment-in-startups-slows-67f3bd7c
Managing Partner Frank Angella speaks with Pitchbook on evolving trends in GP commitments and key LP considerations when assessing whether managers have ‘skin in the game.’ Investors should ascertain the source and composition of the GP commitments to get a true gauge of alignment. Read more here: https://pitchbook.com/news/articles/gp-commitments-private-equity-fundraising
Atlas Holdings exits its investment in International Wire Group (“IWG”), a leading designer and manufacturer of highly-engineered copper-based wire products with operations across the US and Europe. Atlas acquired IWG in April 2019 and transformed the business, unleashing strong growth and driving operational excellence. Olympus acquired IWG for $900M and Atlas will continue as a minority investor. GroveStreet first became an Atlas Holdings LP in 2014. Read more about the deal here: https://www.privateequitywire.co.uk/2023/04/21/320302/olympus-pay-900m-wire-maker-iwg
KPS Capital Partners (KPS) completes the sale of Howden, a leading global provider of mission critical air and gas handling products and services, to Chart Industries for $4.4B in cash. The strategic acquisition expands Chart’s offering across clean power, water, food and industrials. KPS first invested in Howden in September 2019. GroveStreet first became a KPS LP in 2003. Read more about the deal here: https://www.globenewswire.com/news-release/2023/03/17/2629484/0/en/Chart-Industries-Completes-the-Acquisition-of-Howden.html