J-Curve Exposure

List of Boxes
Foreword
Acknowledgments
Abbreviations
Disclaimer
PART I PRIVATE EQUITY LANDSCAPE
1 Introduction
2 Institutional Investing in Private Equity
3 Private Equity Environment
4 Risk Management Lessons from a Listed Private Equity Fund-of-Funds
Appendix 4A Adjusted current ratio methodology
PART II THE ECONOMICS OF PRIVATE EQUITY FUNDS
5 Venture Capital Fund Fair Value
6 Model-Based Approach to VC Fund Valuation
7 Private Equity Fund Valuation Approaches
8 Distribution Waterfall
9 Break-even Analysis
10 Track Record Analysis
Appendix 10A Performance spread between best and worst manager
PART III MANAGING UNDER UNCERTAINTY
11 Grading and Fitness Landscapes
12 Private Equity Funds and Real Options
13 Co-investing
14 Side Funds
15 Limited Partner Decision-Making Fallacies
PART IV MANAGING PORTFOLIOS OF PRIVATE EQUITY FUNDS
16 Portfolio Construction Principles
17 Portfolio Construction Rules of Thumb
18 Guidelines, Monitoring and Corrective Actions
19 Securitization
20 J Curve Exposure
References
Index

PIERRE-YVES MATHONET MSc Fin MSc Mngt, is heading the venture capital unit within the risk management division of the European Investment Fund. He is also a member of the private equity subcommittee of the Chartered Alternative Investment Analyst(r) Program.Before that, he worked as an investment banker in the technology groups of Donaldson, Lufkin & Jenrette, and Credit Suisse First Boston, and previously for the audit and consulting departments of PricewaterhouseCoopers. He is a regular speaker at major conferences, and initiated and chaired the EVCA's Private Equity Foundation Course for Limited Partners. He has contributed articles to some leading alternative investments and financial publications. Pierre-Yves holds a Master of Science cum laude in Finance from London Business School and a Master of Science magna cum laude in Management from Solvay Business School in Brussels. He is also a Certified European Financial Analyst cum laude.Dr THOMAS MEYER heads up the risk management division of the European Investment Fund. Over the last few years he has been responsible for the creation of the European Investment Fund's risk management function. The focus of his work is the development of valuation and risk management models and investment strategies for venture capital fund-of-funds. Thomas studied computer science at the Bundeswehr Universität in Munich followed by doctoral studies at the University of Trier. He holds an MBA from the London Business School and an MA in Japanese Language and Society from the University of Sheffield. After 12 years in the German Air Force he worked for the German insurance group Allianz AG in corporate finance and as the regional Chief Financial Officer of Allianz Asia Pacific in Singapore. He was a Visiting Research Fellow at Hitotsubashi University in Tokyo and is a member of the private equity subcommittee of the Chartered Alternative Investment Analyst(r) (CAIA) Program.Together, as risk managers, the authors are

"This book is written with clarity and comprehensively researched, with every angle debated." (Private Equity Europe, Issue 92 January 2008)