Investors and Exits

In the earlier instalments of this three-part series, we shared insights from the Australian Investment Council Champions of Change on how they managed the COVID-19 forced rapid adoption of remote working practices within their firms and their portfolio companies. This final instalment provides insight on how the Champions of Change are raising capital and selling assets while working remotely.

The Champions say that fundraising at the start of the pandemic slowed down but it never stopped. Adamantem Capital’s managing director, Rob Koczkar said: “We were supposed to close our Fund 2 fundraising at the end of April. It took us three months longer, but we got to where we hoped to be.”

Investors now appear to be utilising technology more and engaging external research organisations to help with the due diligence process. Allegro Fund’s managing partner Chester Moynihan says: “Global LPs are finding ways to do due diligence and commit funds, despite the environment. I hear they are placing more stow on references, on your track record, using online platforms like Teams to communicate and hiring organisations that specialise in background research.”

The Champions noted that an increasingly important consideration for investors in the due diligence process is diversity on fund manager teams. There is a growing awareness amongst investors on the business benefits of diverse teams and the gender imbalance within the industry. It is apparent to the Champions that is desirable for investors that women from fund manager firms attend meetings. OneVentures’ co-founder and venture partner, Anne-Marie Birkill, says: “Diversity is self-evident when interacting with our LPs.” She believes that OneVentures’ market-leading diversity strategies give them a competitive advantage and helped them recently close their fourth fund with strong interest from investors.

Exist haven’t stopped either. Quadrant Growth Fund’s managing partner, Justin Ryan says Quadrant has been planning an exit for one of its best performing recent acquisitions, Adore Beauty. “We are exploring the possibility of an IPO. The non-deal roadshow and the whole transaction could essentially be done on Zoom. Markets haven’t stopped because of COVID so, given the right sector, it is possible to get things done.”

Chris Nave, Brandon Capital’s founding partner and managing director is equally as upbeat. “Nasdaq has been incredibly supportive of biotech assets right through this, with new listings and some massive raisings. The acquisitive interests we have been receiving from global pharmaceutical companies has not changed. We don’t see it having any impact on the valuations and exits we think we can achieve.”

Private capital firms have clearly adapted well to raising capital and selling assets while remote working. The Champions of Change say that flexible working is here to stay in their firms and encourage the whole private capital industry to adopt the same approach to flexible working. This powerful change could help reverse the gender imbalance within the private capital industry with flexible working being a key enabler for a more diverse and inclusive firm.

To find out more about the Champions of Change and the Australian Investment Council’s diversity work visit The Australian Investment Council has a range of case studies, tools and other resources to help you bring about change within your own firm on our diversity webpage. And, stay tuned for more developments as we continue to work with our Champions of Change to support the long-term growth of private capital investment in Australia.