Capital Allocators’ Post

Top quotes from my conversation with John Connaughton from Bain Capital. 1. "In the early years, the rest of the industry primarily hired from investment banks. We hired consultants, who are risk-averse, and found that we had a unique advantage in recruiting talent." 2. "Why are we going to be able to buy a business and yet deliver a better return than anybody else that's looking at it? The only reason you can do that is to create some form of inflection." 3. "We were one of the first firms that got into credit, public equity, and venture. We were one of the first to expand globally with our own people putting feet on the street. We wanted to find ways to provide opportunity for our people so we could keep our talent." 4. "We have had 48 leaders of our businesses who have come from a different part of the firm; 20% of them have come back to the firm to lead businesses after they've left." 5. "Our culture is about your long-term arc of impact and track record as well as your collaboration and work with the rest of the firm." 6. "We have a saying: who are the 10 mentees over the course of your career who are incredibly successful 10 years later." 7. "Partnership is a double-edged sword. Consensus can be terrific to vet outcomes and get to better answers, but sometimes consensus can yield less nimble decision making." 8. "Our reward system aims to be long-term investment-rich, which leads to a desire to reward patience and continuity." 9. "We're 40 years in the narrative for our industry, and it’s still not that far away from the Barbarians of the Gate stereotype. We need to turn that around." With thanks to 10 East.

An interesting podcast. In the course of my work as a career advisor, i often hear from employers about the lack of talent (or perhaps "quality" young talents). On the flip side, students often ask if it's possible to break into the PE/VC space and how to. Perhaps listening to this podcast will give some insights. Some key takeaways I've gained via this podcast: Challenges: 📈 Rising interest rates and increased competition pose new challenges for private equity firms. 📉 Traditional cost-cutting and leadership replacement strategies are less effective. 📈 Increasing investments/companies are being bought from one PE firm by another PE firm. That means the investment has already gone through round(s) of being "streamlined". 💹 Attracting and retaining talent in a tight labor market is crucial. The demographics of the labor market are changing too. This translates to: 💡 More opportunities for young graduates. 💡 PE firms should cast the net wider, instead of focusing on hiring "trained" former investment bankers. 💡 PE firms have more incentives to improve employee engagement and reduce turnover. 💡 And create better alignment with the values of younger generations.

"3 Quick Takeaways From Bain & Company’s Private Equity Midyear Report 6-24-24" Listen Here: https://lnkd.in/gZ7iT2QB #podcast #businessnews #privateequity #economicnews Scott Becker Private Equity and Healthcare Podcasts -Scott Becker McGuireWoods LLP Becker's Healthcare Becker Private Equity and Business Podcast

Greatly enjoyed meeting Ron "Omani" Carson (he/him) last week at Barron's Advisor's Independent Summit in Salt Lake City where we recorded a new The Way Forward podcast episode. In it Ron describes how he started Carson Group, which today manages $35 billion and serves 50,000 families, explains what advisory firms need to do to succeed in the future, and highlights the importance of attracting next-generation talent and embracing AI. Highlights include: * Landing his first client in 1983. “I started the business cold calling out of my dorm room, literally out of a phone book. I connected with farmers or people that serve farmers, and I had this elderly couple in Fairmont, Nebraska that had just sold their drugstore. I remember driving out there. I had my meeting with them, and they opened an account and they gave me a check for $2,000. I was so excited. I was listening to Abba, which was one of my favorite bands at the time. And I remember playing Dancing Queen as I’m driving away from that. And wow. I didn’t know what I was doing. Thank goodness I knew something about farming and could relate to people.” * The coming war for talent. “We don’t have nearly enough people in our profession and we’re not bringing them in. There are more advisors over the age of 80 than under the age of 30. It’s a problem. And you’re going to see wage pressure accelerate, and there’s going to be truly a war on talent.” * How to attract next-gen talent. “Figure out what your culture is going to be. Are you going to be a high performance culture? Are you going to be a family culture? And that is a big differentiator in the marketplace. You can attract the kind of people that want to be part of that culture. Maybe your culture is just all-around impact. Great. But the more you can define it, the more you’ll start to attract people. Two, have a career track for people to come in. I think we’ve done a terrible job of selling what it means to be an advisor and an RIA firm. There’s just so many opportunities that have nothing to do with sales and provide real tracks for them to come up.” https://lnkd.in/e-ctPJ88

"3 Quick Takeaways From Bain & Company’s Private Equity Midyear Report 6-24-24" Listen Here: https://lnkd.in/gZ6NN3T6 #podcast #businessnews #privateequity #economicnews Scott Becker Private Equity and Healthcare Podcasts -Scott Becker McGuireWoods LLP Becker's Healthcare Becker Private Equity and Business Podcast

"3 Quick Takeaways From Bain & Company’s Private Equity Midyear Report 6-24-24" Listen Here: https://lnkd.in/gYE8b7cu #podcast #businessnews #privateequity #economicnews Scott Becker Private Equity and Healthcare Podcasts -Scott Becker McGuireWoods LLP Becker's Healthcare Becker Private Equity and Business Podcast

Sharing these thoughts from one of our distinguished editorial board members, below: ⬇️

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