Advent vs. other MFs
Hi, just had a fit phone call where I was asked on my view of Advent vs. Apollo / Advent vs. Bain Cap
What are your views on this please?
My understanding is that Advent is more hands-on and strive to create value for LPs through operational improvements while Apollo is more financial engineering driven (just like CD&R, KKR). But how does Bain Cap position itself?
Advent and Bain are both more operationally involved players vs. the likes of KKR, BX, Apollo etc.
As you break down returns, this usually means most of the return uplift coming from earnings growth & strategic repositioning vs. debt paydown. However, it is worth noting that, with rising entry multiples, most players have started to prioritize operational improvements.
Bain Cap is somewhat the OG of this approach and primarily invests in situations with significant operational transformation need/potential with a historically prudent valuation approach (although this has gone up in recent years). Often, this would include low-growth divisions or P2Ps bogged down by corporates/public markets. To be able to perform such a portfolio management approach, Bain primarily hires consultants and has their own portfolio support team
Advent, as a fellow Boston firm, shares many of the above characteristics, however, on top of Bain style complex deals, they also invests in smaller, high growth companies where Advent can accelerate the growth profile (e.g., lululemon). They are also very operationally involved with portfolio support team, but maybe a tad less than Bain (however, not necessarily to their detriment as Bain has historically not always been super high ROI on these activities)
Super helpful, many thanks!!
Curious what you think of Advent vs H&F. Both seem to focus on growthier companies and have similar strategies
H&F you could argue has a slightly higher bar for how bulletproof an asset needs to be (and is willing to pay a bit more as a result). Advent I bit more willing to do deals where the future is a bit less clear (eg. carve outs)
Who could possibly be asking you a question like this?
Headhunter...
Which HH?
This is all kind of marketing. Every firm now says they get their returns by building and operating great businesses. Apollo and other value distressed type people are the one group that don’t say that.
Bain was definitely early to that party though, spinning out of their consulting arm
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