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Private Equity

Private Equity

Approach


Our Venture Capital and Growth Equity strategy is managed by a global team of professionals passionate about partnering with entrepreneurs around the world to build revolutionary technology-enabled businesses. Our strategy pursues late-stage venture capital and growth equity investments in companies with a focus on consumer and business technologies. With insights in both private and public markets, we target opportunities based on proprietary sourcing and deep due diligence and also have the ability to provide co-investment opportunities.

Identifying Opportunities
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We look for companies that share several common characteristics: 1) pursue large addressable markets, 2) take an independent approach to reduce pain points that exist in an industry in which legacy players have failed to innovate, 3) demonstrate attractive and sustainable performance metrics and 4) visionary leaders guide the company.

Proprietary Sourcing and Due Diligence
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We leverage the Goldman Sachs network to access proprietary deal flow and conduct bottom-up, fundamental analysis of each opportunity to develop an investment thesis. Our companies must demonstrate attractive, sustainable performance metrics and visionary leadership with high-quality management teams.

Creating Value
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We maintain active relationships with our companies dedicating resources to help management teams achieve their goals. We take a long-term view on our investments and may remain invested after our companies become public.

Benefits


Global reach

As part of Goldman Sachs, we have the ability to tap into a broad network to access opportunities and potential deal flow sourced by proprietary channels. In addition, the global relationships of both our team and Goldman Sachs broadly can help our portfolio companies achieve their objectives.

 

Long-term partner of choice

We care deeply about helping our companies succeed and aim to be one of their most valuable investment partners. With deep-rooted expertise in helping companies across various points in their evolution, management teams have relied on us for guidance.

Domain expertise
Our experience over the past 12 years and more than 100+ investments enables us to become a highly valuable partner to our portfolio companies and our clients. Our close relationship with our public investment team allows us to leverage extensive public market investing experience, giving the team the ability to cross-reference public and private investments, valuations and deal structures.

Approach


Our multi-manager private equity team operates around the world, leveraging access to the broader Goldman Sachs network to continually identify and evaluate new markets and opportunities. This on-the-ground presence allows the team to apply local knowledge and understanding in their examination of potential managers across all geographies and strategies, including Environmental, Social and Governance (ESG)-oriented investments. We also have the ability to create customized private equity solutions tailored to our clients’ specific investment objectives.

Broad Sourcing of High-Quality Managers
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Utilizing the scale and expertise of our geographic- and industry-focused strategy vertical teams, we seek to identify trends driving meaningful growth. We have developed key manager relationships to execute a wide range of investment strategies.

Adaptive Portfolio Design
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We take a differentiated approach to portfolio construction, creating innovative solutions diversified across various investment strategies. We then carefully build portfolios with the ability to achieve long-term value creation through strategic allocations and adaptive portfolio commitments.

Ongoing Risk Management
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We continuously evaluate our private equity program and underlying funds by managing risk across previous, current and future commitments. Supplemented by our dedicated legal, compliance and operational due diligence teams, we actively monitor our managers, maintaining close contact to understand and uncover potential risks.

Benefits


Established relationships and expertise

We utilize our deep understanding to identify trends driving meaningful growth in specific strategies and across all industries and geographies, granting our clients access to the full range of opportunities within private equity.

 

Inherent long-term investment view

By focusing on long-term growth over quarterly performance metrics, private equity managers can develop capital plans and effect organizational changes more quickly than under a public ownership structure, thereby providing the ability to more nimbly adapt to evolving situations and presenting the potential to generate excess returns.

Focus on managers actively creating value
We focus on identifying managers who can drive value by working closely with top corporate executives, ensuring they are strongly incentivized to deliver robust operating performance, while also helping to improve the company’s strategy, re-engineer capital structure or enhance management.

Approach


Through secondary private equity investments, we seek to provide liquidity, capital and partnering solutions to both investors and asset managers, investing across all private equity strategies—from leveraged buyouts, venture and growth capital, to distressed securities, real estate and Environmental, Social and Governance (ESG) strategies. Our secondaries program acquires mature private investment portfolios through a wide range of transaction types designed to capitalize on disruptions and dislocations in private markets.

Find Value Investing in All Segments of Private Markets
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We capitalize on our access to Goldman Sachs’ private markets business to enhance our valuation capabilities. We closely monitor key industry trends and macroeconomic developments, while continuously analyzing and valuing a broad array of opportunities to ensure speed of execution and proactively identify potential transactions.

Capitalize on Disruption to Acquire Assets
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We look for opportunities to buy assets at attractive prices, capitalizing on market friction and disruption created by many factors, including macroeconomic or financial stress, industry-specific or organizational disruption, active management and generational transition.

Create Opportunities Partnering with Knowledgeable Investors
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We have an extensive history of providing innovative solutions to challenges faced by private markets investors and managers. We believe experienced buyers have an advantage in these non-traditional transactions, involving complex structuring and multi-party negotiations.

Benefits


Higher velocity of capital and diversification

Secondaries can offer an accelerated capital profile, investing and returning capital more quickly than their primary counterparts by entering into investments already part-way through their life. The underlying fund commitments can span a range of vintage years, strategies, industries and geographies, providing an efficient means of portfolio diversification.

 

Extensive sourcing and execution expertise

We are able to leverage Goldman Sachs’ network in combination with information obtained through thousands of private equity manager interactions to source deals and inform our secondary investments. Over the last 20 years, this has enabled us to invest over $20 billion across more than 275 distinct private equity secondary transactions.

 
Disciplined approach to structuring portfolios
We take a holistic approach to formulating a private equity portfolio, utilizing secondaries to achieve diversification and manage cash flows for investors. We seek to build innovative strategies that invest across all market segments and span a range of transaction types, from team spin-outs and fund restructurings to structured secondaries.

Approach


Over the last two decades, we have built extensive relationships with over 500 leading investment managers and developed deep expertise in sourcing, evaluating and executing co-investments across a range of opportunities. Our multi-manager private equity team applies a rigorous, independent evaluation process to each co-investment opportunity, analyzing both the company and co-investment manager, as well as employing a risk-based allocation approach designed to complement portfolio-wide exposures.

Broad Sourcing of High-Quality Managers
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Sourced from hundreds of manager relationships, we leverage our platform to curate a list of high-quality managers able to deliver compelling co-investment opportunities. We continuously analyze and evaluate deal opportunities to identify an attractive option to complement our strategy.

Thorough and Independent Evaluation
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We conduct a detailed independent evaluation based on a series of distinct factors to quantify key aspects of both deal and manager, mindful of the market environment and relative attractiveness of each opportunity. We seek to diversify portfolios across strategy, industry and geography.

Ongoing Risk Management
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We provide detailed assessments from various angles, including reviewing potential reputational, regulatory, compliance and safety issues, as well as incorporating legal, compliance and operational due diligence review. In addition, senior professionals regularly re-evaluate all portfolio investments.

Benefits


Extensive experience and scale

As active, experienced investors in the private equity arena, we are able to source leading private equity managers. Additionally, as part of our broader multi-manager investing platform, we are able to source and tap into select opportunities from across the full range of private equity strategies.

 

Firsthand insight into specific market areas

With this in-depth look into a company’s strategy, co-investors are able to gain firsthand insight into specific regions and sectors, which can help inform views on other investments and expand their experience in areas of their choosing.

Improved relationships and economics
Through co-investments, investors can potentially access deals in a more cost-efficient manner relative to more traditional private market vehicles. Clients are also able to gain insights into an experienced manager’s investing strategy and process, deepening their relationships.

Approach


Our manager stakes program, through which we provide capital to management companies of established alternative investment managers, combines our extensive relationships across the alternatives landscape with our structuring expertise to create differentiated opportunities for investors. These investments are carefully structured to capture equity upside while seeking to actively mitigate certain downside risks by accessing different income streams than typical alternative investments.

Proprietary Sourcing and Evaluation
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With our deep experience and understanding of the alternatives market, we have become a trusted partner and a leading investor in the space. In combination with the breadth of our Goldman Sachs network, we leverage these capabilities across multiple asset classes to identify select investment opportunities.

Disciplined Structuring and Extensive Negotiating Experience
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Empowered by extensive deal structuring and negotiating experience and demonstrated value creation, we are able to be selective in our choice of investment opportunities and disciplined in our structuring practices to set clear pricing and term targets.

Long-term Partnerships
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As an experienced investor with relationships spanning the alternative investment universe, we work with management teams to help grow and develop their businesses, encouraging best practices and identifying areas of opportunity.

Benefits


Capitalize on sector growth

As a high-growth, evolving industry, alternatives firms continue to grow their businesses, often requiring growth capital and an expansion of their balance sheets. We believe that our approach to funding management companies delivers a distinct investment opportunity to investors seeking exposure to the industry.

 

Demonstrated history of investment

Our team has pioneered investment in the manager stakes strategy space, operating since 2007. With this experience, we have demonstrated the full cycle of investments—from sourcing and execution, to full investment and portfolio realizations.

Access stable businesses with significant free cash flow
Minority-stake economics in an established management company gives investors exposure to businesses with relatively stable and predictable cash flows, offering the opportunity to benefit from multiple drivers of value creation and potential for further upside upon monetization while maintaining an attractive yield and downside mitigation.