How can private equity firms make more money by building RApport?

Areas of Interest

Investing successfully in private equity depends on artful management of critical processes and constituencies:

Opportunity Origination – Early identification of investments and development of proprietary advantages and insights
Sector Bankers – Ensure a consistent, high-quality flow of relevant ideas and inclusion in sale processes
Capital Markets – Establish relationships that help ensure successful portfolio company financings
Executive Contacts – Create a network of talent that can provide insights into sectors and companies

Potential Benefits

There are many potential benefits, both financial and non-financial:

More Good Deals – Invest where you want, not just where you can
Successful Syndications – Execute processes that are consistently over-subscribed by collaborative lenders
Favorable Financing – Obtain debt at the lowest cost and with the most flexible terms
More Exclusive / First / Early Calls – Get there before the rest and have more time for relationship development, diligence, and approval
Proprietary Insights – Develop unique perspectives and angles that provide competitive advantages
Better Market Intelligence – Consistent flow of quality investment ideas; share insights with lenders and industry executives; monitor executive transitions and litigation
Efficient Origination Efforts – Maximize the most actionable opportunities by meeting key stakeholders early, either directly or at industry conferences
Firm-wide Brand Promotion – Easy to use tools that provide the right data at the right time will help the firm deliver effective and consistent messages

Available Resources

Your firm has many assets other than investors’ capital that can be leveraged to achieve its goals:

Intellectual Capital – Sector expertise and insights into companies, particularly those of interest to debt investors
Fee Pool – Pay firms that are collaborative and provide insights and investment ideas
Risk Relief – Willingness to help banks manage commitment and distribution risks
Expert Contacts – Ability to make introductions to companies, executives, bankers, and lenders
Considerate Relationships – Respect for others’ time, exclusive ideas and opportunities, and business objectives
Consistent Conduct – Common standards and behavior throughout the firm regarding the pursuit of opportunities and bidding behavior
Data Goldmine – Capturing and leveraging data can make all this possible
Process Execution – Wide-spread adherence to adopted protocols ensures seamless operation and messaging

How can RApport^TM help apply the
Principles of Influence?

Facts and processes that reinforce your point can affect a desired outcome

Reciprocity

Fees

Invitations to pitch for M&A engagements and/or provide financing commitments

Invitations to management meetings

Sector expertise and insight into companies

Executive and banker introductions

Syndication allocations

Early access to management during syndication processes

Regular investor updates from portfolio companies

Scarcity

Fee pool

Limited number of invitations to pitch for M&A engagements

Limited number of invitations to provide financing commitments

Limited number of invitations to management meetings

Limited executive and company introductions

Exclusivity of insights

Syndication allocations

Early access to management during syndication processes

Authority

Sector activity: # deals / market share

% of processes advanced to management meeting after an initial indication of interest

% of processes where bids were placed and the firm advanced to the final round

Total quantum of debt financed: overall / tranche types

% of financings over-subscribed before bank meeting

% of financings over-subscribed

# of debt holders: portfolio / company

Total assets under management by key lenders

Consistency

Fees paid to relationships that are value-added idea sources and opportunity originators

Invitations to provide financing and pitch for M&A engagements given to value-added relationships

Invitations to management meetings

% of allocations given to lenders who commit prior to bank meetings

% of bids placed that were sufficient to advance to management meetings

% of bids placed after fireside chats / gold card meetings that were sufficient to advance to management meetings

Liking

# of previous deals together both as a firm and personally

Appreciative, personal comments during meetings and other events

Systematic congratulatory notes regarding successful transactions with other firms

Alignment of coverage between firms

Systematic monitoring of news source to recognize matters of personal interest and generate personal notes

Optimization of invitations to entertainment / relationship building experiences

Consensus

Comparison to competition regarding value-added origination and other reciprocal efforts

% of available fireside chats / gold card meeting invitations in areas of interest

Number of deals done away compared to competitors

% of financings over-subscribed before bank meetings

Average share of allocations to firms that committed before bank meetings

% of financings over-subscribed

# of debt holders: portfolio / company

Average approval rate for financing amendments, waivers, and other consents

What are some of the things you will be able to say?

Multiple Principles can be reinforced with a statement

Investment Banks

Origination Efforts

We are taking a holistic view of our firm-to-firm relationship. Our access to your bankers' expertise will be a consideration when we award mandates.

During the past 18 months, we have had X meetings with bankers from your firm. From those meetings, we discussed Y opportunities that were particularly interesting.

We appreciate that your firm has been the primary idea source for X% of the opportunities we identified during the past 18 months, which falls in the Y percentile when compared to your competitors.

Thank you for the X one-on-one meetings and Y introductions to industry executives during the past two years.

Investment Banks

Consistency & Reliability

We are committed to rewarding banks that demonstrate partnership in our origination efforts. We regularly review these reports to ensure we reciprocate appropriately.

We only accept invitations to fireside chats / gold card meetings when we are serious about an opportunity. During the past two years, when we received such opportunities X% of our initial bids were sufficient to advance to management meetings.

We can help you mitigate your syndication distribution risk by helping build momentum. During the past three years, our relationships with some of the biggest debt investors have contributed to the creation of over-subscriptions prior to the bank meeting for X% of our issuances.

Investment Banks

Value Contribution

Here is how we have assessed your firm's efforts relative to your competitors.

Part of our relationship investment analysis is an assessment of how well we think we worked together on opportunities. We had great experiences on the majority of our interactions, but in a few instances, we had some concerns.

We would like to understand why the original idea for an opportunity came from another bank X% of the time your firm led a process in the Y sector.

During the past two years, bankers from your firm have offered X introductions to key individuals, of which Y% were of interest to us. However, they followed-through and delivered the introductions Z% of the time.

Lenders

Financing Participation

In our last five syndications, your firm's allocations were in the top decile three times and were no lower than the top quartile.

We have given your firm $X million dollars of allocation bumps over what capital markets groups suggested.

We were unable to include your firm in the pre-marketing sessions because your firm has only committed early X% of the time, which is below the average of Y% for other firms.

We favor firms that are reasonable and decisive when it comes to amendments and waivers. Your firm assented after the approval threshold was reached for 5 of 8 recent requests, which falls in the bottom quartile.

Lenders

Collaboration

Our partners have had X meetings with your firm during the past year to share our insights.

During the past 18 months, we have provided X exclusive introductions to key industry executives who can provide expert insights.

We noticed your firm is the top lender to Company ABC, which we are tracking. We would love to get your insights.

During the past two years, we have given your firm a first look at subordinated debt offerings for X of our companies.

We mentioned our firms' strong relationship to the capital markets teams at ABC and XYZ banks. Hopefully, that will help raise awareness of how your new firm is growing.

Process Optimization

Efficiency & Consistency

Here is a call list that has all of the people you said you wanted to contact every 90 days with the outstanding items to discuss.

Here is a list of upcoming meetings where someone in the firm is visiting with someone who is of interest to you. Let us know if you want us to prompt them to mention any of your high priority opportunities.

It probably is not worth spending much time with Lender A because they have never made a commitment before a bank meeting and they are short-term holders.

We should consider inviting these people to our upcoming event because they have key contacts or are large lenders to companies that are a high priority for us and are likely to come to market in the next 18 months.

Investment Banks

Origination Efforts

We are taking a holistic view of our firm-to-firm relationship. Our access to your bankers' expertise will be a consideration when we award mandates.

During the past 18 months, we have had X meetings with bankers from your firm. From those meetings, we discussed Y opportunities that were particularly interesting.

We appreciate that your firm has been the primary idea source for X% of the opportunities we identified during the past 18 months, which falls in the Y percentile when compared to your competitors.

Thank you for the X one-on-one meetings and Y introductions to industry executives during the past two years.

Investment Banks

Consistency & Reliability

We are committed to rewarding banks that demonstrate partnership in our origination efforts. We regularly review these reports to ensure we reciprocate appropriately.

We only accept invitations to fireside chats / gold card meetings when we are serious about an opportunity. During the past two years, when we received such opportunities X% of our initial bids were sufficient to advance to management meetings.

We can help you mitigate your syndication distribution risk by helping build momentum. During the past three years, our relationships with some of the biggest debt investors have contributed to the creation of over-subscriptions prior to the bank meeting for X% of our issuances.

Investment Banks

Value Contribution

Here is how we have assessed your firm's efforts relative to your competitors.

Part of our relationship investment analysis is an assessment of how well we think we worked together on opportunities. We had great experiences on the majority of our interactions, but in a few instances, we had some concerns.

We would like to understand why the original idea for an opportunity came from another bank X% of the time your firm led a process in the Y sector.

During the past two years, bankers from your firm have offered X introductions to key individuals, of which Y% were of interest to us. However, they followed-through and delivered the introductions Z% of the time.

Lenders

Financing Participation

In our last five syndications, your firm's allocations were in the top decile three times and were no lower than the top quartile.

We have given your firm $X million dollars of allocation bumps over what capital markets groups suggested.

We were unable to include your firm in the pre-marketing sessions because your firm has only committed early X% of the time, which is below the average of Y% for other firms.

We favor firms that are reasonable and decisive when it comes to amendments and waivers. Your firm assented after the approval threshold was reached for 5 of 8 recent requests, which falls in the bottom quartile.

Lenders

Collaboration

Our partners have had X meetings with your firm during the past year to share our insights.

During the past 18 months, we have provided X exclusive introductions to key industry executives who can provide expert insights.

We noticed your firm is the top lender to Company ABC, which we are tracking. We would love to get your insights.

During the past two years, we have given your firm a first look at subordinated debt offerings for X of our companies.

We mentioned our firms' strong relationship to the capital markets teams at ABC and XYZ banks. Hopefully, that will help raise awareness of how your new firm is growing.

Process Optimization

Efficiency & Consistency

Here is a call list that has all of the people you said you wanted to contact every 90 days with the outstanding items to discuss.

Here is a list of upcoming meetings where someone in the firm is visiting with someone who is of interest to you. Let us know if you want us to prompt them to mention any of your high priority opportunities.

It probably is not worth spending much time with Lender A because they have never made a commitment before a bank meeting and they are short-term holders.

We should consider inviting these people to our upcoming event because they have key contacts or are large lenders to companies that are a high priority for us and are likely to come to market in the next 18 months.

Let's discuss how RApport^TM could help your firm stay ahead of the competition

Find time

See how other groups
can generate alpha

Direct Lenders

See how RApport^TM can help you stay ahead of your competition on origination and opportunity development efforts and convince financial sponsors they should partner with your firm

Learn how your firm can reduce risk and win mandates by running differentiated, well-informed syndication processes that are consistently oversubscribed

Review how RApport^TM can enable firm-wide participation in brand marketing and reduce operational risks by ensuring consistent process execution that uses valid, standardized information

Calculate how much more OID your firm could get from the deals you really like by convincing financial sponsors and capital markets groups your firm should be a preferred investor

Win more mandates by optimally deploying bankers’ intellectual capital and opportunities to high-quality relationships that appreciate and consistently reward origination efforts

How can RApportTM help financial sponsors?

Areas of Interest

Potential Benefits

Available Resources

How can RApportTM help apply the Principles of Influence?

Facts and processes that reinforce your point can affect a desired outcome

Reciprocity

Fees

Invitations to pitch for M&A engagements and/or provide financing commitments

Invitations to management meetings

Sector expertise and insight into companies

Executive and banker introductions

Syndication allocations

Early access to management during syndication processes

Regular investor updates from portfolio companies

Scarcity

Fee pool

Limited number of invitations to pitch for M&A engagements

Limited number of invitations to provide financing commitments

Limited number of invitations to management meetings

Limited executive and company introductions

Exclusivity of insights

Syndication allocations

Early access to management during syndication processes

Authority

Sector activity: # deals / market share

% of processes advanced to management meeting after an initial indication of interest

% of processes where bids were placed and the firm advanced to the final round

Total quantum of debt financed: overall / tranche types

% of financings over-subscribed before bank meeting

% of financings over-subscribed

# of debt holders: portfolio / company

Total assets under management by key lenders

Consistency

Fees paid to relationships that are value-added idea sources and opportunity originators

Invitations to provide financing and pitch for M&A engagements given to value-added relationships

Invitations to management meetings

% of allocations given to lenders who commit prior to bank meetings

% of bids placed that were sufficient to advance to management meetings

% of bids placed after fireside chats / gold card meetings that were sufficient to advance to management meetings

Liking

# of previous deals together both as a firm and personally

Appreciative, personal comments during meetings and other events

Systematic congratulatory notes regarding successful transactions with other firms

Alignment of coverage between firms

Systematic monitoring of news source to recognize matters of personal interest and generate personal notes

Optimization of invitations to entertainment / relationship building experiences

Consensus

Comparison to competition regarding value-added origination and other reciprocal efforts

% of available fireside chats / gold card meeting invitations in areas of interest

Number of deals done away compared to competitors

% of financings over-subscribed before bank meetings

Average share of allocations to firms that committed before bank meetings

% of financings over-subscribed

# of debt holders: portfolio / company

Average approval rate for financing amendments, waivers, and other consents

What are some of the things you will be able to say?

Multiple Principles can be reinforced with a statement

Investment Banks

Origination Efforts

We are taking a holistic view of our firm-to-firm relationship. Our access to your bankers' expertise will be a consideration when we award mandates.

During the past 18 months, we have had X meetings with bankers from your firm. From those meetings, we discussed Y opportunities that were particularly interesting.

We appreciate that your firm has been the primary idea source for X% of the opportunities we identified during the past 18 months, which falls in the Y percentile when compared to your competitors.

Thank you for the X one-on-one meetings and Y introductions to industry executives during the past two years.

Investment Banks

Consistency & Reliability

We are committed to rewarding banks that demonstrate partnership in our origination efforts. We regularly review these reports to ensure we reciprocate appropriately.

We only accept invitations to fireside chats / gold card meetings when we are serious about an opportunity. During the past two years, when we received such opportunities X% of our initial bids were sufficient to advance to management meetings.

We can help you mitigate your syndication distribution risk by helping build momentum. During the past three years, our relationships with some of the biggest debt investors have contributed to the creation of over-subscriptions prior to the bank meeting for X% of our issuances.

Investment Banks

Value Contribution

Here is how we have assessed your firm's efforts relative to your competitors.

Part of our relationship investment analysis is an assessment of how well we think we worked together on opportunities. We had great experiences on the majority of our interactions, but in a few instances, we had some concerns.

We would like to understand why the original idea for an opportunity came from another bank X% of the time your firm led a process in the Y sector.

During the past two years, bankers from your firm have offered X introductions to key individuals, of which Y% were of interest to us. However, they followed-through and delivered the introductions Z% of the time.

Lenders

Financing Participation

In our last five syndications, your firm's allocations were in the top decile three times and were no lower than the top quartile.

We have given your firm $X million dollars of allocation bumps over what capital markets groups suggested.

We were unable to include your firm in the pre-marketing sessions because your firm has only committed early X% of the time, which is below the average of Y% for other firms.

How can RApport^TM help apply the
Principles of Influence?

See how other groups
can generate alpha

See how RApport^TM can help you stay ahead of your competition on origination and opportunity development efforts and convince financial sponsors they should partner with your firm

Review how RApport^TM can enable firm-wide participation in brand marketing and reduce operational risks by ensuring consistent process execution that uses valid, standardized information