Private Markets Advisory Services
Private Markets investing has many benefits for sophisticated institutional plans, but is also more complex than public markets investing. A private markets investment program requires thorough and continuous supervision by an investment professional. Private Markets Consulting involves four essential services: strategic planning, partnership analysis, program monitoring, and cash flow coordination.
Strategic Planning
Meketa Investment Group integrates a fund's private markets allocation with its strategic plan for all investments. We view private markets as only one part of a broad, long-term strategic investment plan.
Time-tested investment principles of diversification, discipline, and diligence guide strategic planning. Our process ensures diversification by partnership, partnership type, vintage year, individual company, industry, and geography. Further, we set clear parameters and expectations, providing a discipline for Trustees. Finally, our process establishes the highest standards of diligence in selecting investments.
Partnership Analysis
Partnership selection is an extremely important component of successful private equity investing. We seek the following characteristics in a private markets partnership:
- Proven and repeatable investment strategy
- Sound, cohesive investment process
- Deep, experienced investment resources
- Strong, consistent investment performance
- Competitive operating costs
Selecting superior partnerships requires deep resources and a disciplined process. Meketa Investment Group evaluates over 300 private markets opportunities per year. We assess information constantly from placement agents and directly from private markets managers. Further, we subscribe to many services that publish information regarding managers that are fundraising. Our deal flow is broad, consistent, and constantly refreshed. Our due diligence process has five stages:
- General analysis of investment strategy, process, resources, performance, and operating costs
- Meetings with key members of the manager's investment team, to discuss at greater depth the terms of the investment and the investment strategy
- Telephoning the managers' clients and company executives, who manage the underlying investments of the partnership
- Inspecting the offices of the manager, including meetings with all key employees
- When appropriate, hiring a third party to conduct a full legal and personal background check of all key professionals
Program Monitoring
Once an investment is made, Meketa Investment Group continues to monitor all private markets investments, and reports activity regularly to the trustees. This involves a high degree of communication with all private markets managers.
Further, we develop private markets reports customized for each client. These reports allow the trustees to confirm that the fund's investments are properly diversified and reflect the fund's long-term private markets strategy. Our reports include sections on diversification, cash flow activity, performance, recent significant events, and partnership-level and company-level investment descriptions.
Cash Flow Coordination
Private markets investments require constant capital to fund new investments. Further, proceeds from investment sales are distributed to limited partners in the form of in-kind securities and cash. To manage these cash and security flows effectively, we develop a funding account, where distributions can be reinvested immediately into public equities and capital calls can be fulfilled immediately.
Meketa Investment Group develops and supervises the funding account, and relieves the fund of the administrative burden of capital calls and distributions. This efficient mechanism saves a fund a significant amount of time and, more importantly, significant opportunity costs.