Thursday 07, December 2017 by Jessica Combes

INSEAD Professor writes guide to private equity for investors and finance professionals


INSEAD business school has announced two new books on Private Equity (PE) by Claudia Zeisberger, Senior Affiliate Professor of Decision Sciences and Entrepreneurship & Family Enterprise & Academic Director at INSEAD’s Global Private Equity Initiative (GPEI) and two alumni, Michael Prahl, Distinguished Fellow at GPEI, and Bowen White, Centre Director of GPEI.

Mastering Private Equity–Transformation via Venture Capital, Minority Investments and Buyouts (Mastering Private Equity) provides readers with a valuable and in-depth look on how PE investments work and how the whole industry is evolving. From deal sourcing to exit, leveraged buyouts to responsible investing, operational value creation to risk management, the book systematically distils the essence of private equity into core concepts and explains in detail the dynamics of venture capital (VC), growth equity and buyout transactions. Critical thought is given to the concerns of the institutional investors who invest in PE and have started in recent years to build ‘direct investment’ capabilities.

Containing a foreword by Henry Kravis, Co-Chairman and Co-CEO of KKR, and special guest comments by 25 senior PE and VC professionals, Mastering Private Equity provides an all-encompassing, unbiased guide to investing market practices, enabling its readers to better understand the inner workings of the private equity model. Each chapter focuses on one specific aspect of private equity and is complemented by a comment from guest authors to ensure the right balance of academic rigour and industry relevance.

Key insights include how boards and firms must implement due diligence and work with the right partner best aligned with the management team’s skillsets, the firms current development and its future plans; how PE funds should partner with entrepreneurs and owners who share a common vision for the business and have the right management team in place; and how PE investments require excellent stewardship and management throughout their lifecycle to create operational value for sustainable growth and in preparing for a successful exit independent of the macroeconomic cycle.

“For years, I have been asked questions ranging from how to manage private equity portfolios to the dynamics of GP-LP relationships and the future of the PE model. Over time, I wrote many short primers on these various topics, which were well received by both my students as well as industry players; it was time to compile them into a structured format for easy reference,” said Zeisberger.

The authors have also published a companion case book, Private Equity in Action–Case Studies from Developed & Emerging Markets, which showcases global best practices in private equity investing through 19 case studies written by INSEAD faculty and taught at the world's leading business schools. Written with leading private equity firms and their advisors and rigorously tested in INSEAD’s MBA, EMBA and Executive Education programmes, each case makes for a compelling read.

The case book illustrates the managerial challenges and risk-reward dynamics common to private equity investment and covers the full spectrum of private equity strategies, including: carve-outs in the US semiconductor industry (LBO); venture investing in the Indian wine industry (VC); investing in SMEs in the Middle East; and turnaround situations in both emerging and developed markets.

With increasing interest in private equity as an asset class and with its impressive returns shown in the last decade, PE funds are likely to continue to play an important role in channelling capital and expertise to deserving companies. Mastering Private Equity and Private Equity in Action are good references for investors, finance professionals, business owners, and students looking to engage in this industry.

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