Challenges

Private Equity is illiquid: it takes too long to get my invested money back » read more

Traditional funds and fund of funds usually distribute only small amounts during the first years. This leads to the typical J-Curve of private equity investments. Montana Capital Partners aims to address this issue in two ways: Firstly, Montana Capital Partners concentrates on private equity segments that offer earlier distributions while less capital is tied up in its Secondary activities, i.e. mainly mature portfolios bought at attractive prices. Secondly, Montana’s Structured Solutions tend to have distributions from early on, often from the very beginning of the program.

Private Equity is too resource-intensive for me » read more

Private Equity is a resource-intensive industry and time-consuming in the investment selection, analysis, day-to-day management, risk management and more strategic portfolio management. However, this can be reduced through adequate tools for each step of the private equity value chain. Montana Capital Partners deploys proven and best-in-class processes and tools to assist clients in Risk Management, Investment Management and Portfolio Management (Reporting).

Liquidity planning in Private Equity is impossible » read more

Many investors want to invest in private equity, but draw back given the complexity in forecasting cash flows and uncertainty surrounding capital reserves for the asset class. Montana Capital Partner’s team members have been involved in managing liquidity for a vast array of investors in private equity, ranging from the world’s largest to small and medium-sized investors. Montana has developed market-leading processes and tools in its Risk Management activities to plan liquidity based on the risk appetite of the investor.

Private Equity is too risky for me » read more

Private Equity has been in the news and many people think of it as a ‘risky’ asset class. However, historically private equity’s risk profile has been as good as or better than that of many other equity and equity-related asset classes. The issue is the complexity in managing risk for this asset class. Montana’s Risk Management activities take into account the requirements and specific issues for investors, develop a risk management program for investors and apply the individual parameters in its proven risk management instruments.

I would like to invest in Secondaries, but the investment strategies all look the same to me » read more

The size of the secondary market for private equity fund stakes has increased dramatically over the last decades. As large amounts of capital have been committed to large secondary funds, competition at the larger end has increased, while the market is different for smaller transaction sizes. Montana Capital Partners has a clear understanding of its Secondary investment strategy and will focus on early liquidity and an adequate and attractive risk-return-profile for its investors. Montana concentrates on smaller secondary transactions which are often acquired directly from the seller and invests in largely existing portfolios that allow for an in-depth analysis of the underlying assets.

I want to build a new private equity portfolio. What should I do? » read more

As in real life, the first steps are often the most difficult. When setting up a Private Equity portfolio, many considerations have to be taken into account: How should I allocate commitments? How much should I commit per year and how much cash do I need per year? Which geographies and segments should I invest in? Which managers are worth backing? What reporting tool should I use? How do I reach my target allocation? And many more… Montana Capital Partners has long-standing experience in planning and setting up portfolios, selecting funds through its Investment Management activities, managing and monitoring these portfolios both from a fund perspective in Portfolio Management (Reporting) and portfolio perspective in Risk Management. Montana Capital Partners deploys a step-by-step approach based on a proven process of building private equity portfolios, which is customized to the clients’ needs.

I cannot commit to a 10 to 15 year fund life cycle » read more

Private equity fund and fund of fund investments are usually made through a limited partnership structure with a 10 to 15 year fund life. During the lifetime, investments can only be sold on the secondary market, which requires expertise and is sometimes time-consuming. Montana Capital Partners offers customized investment programs which are not necessarily in traditional fund structures, but separate mandates tailored to the clients’ specific needs, which can differ with regard to liquidity profile, investment focus, risk exposure and lifetime of the vehicle. To mention one example, in the Secondary area, programs with shorter investment periods offer different cash flow profiles for investors.

Basel II and III, Solvency II, AIFMD – what does it mean for my portfolio? » read more

Regulatory requirements are constantly increasing and many of the directives discussed in the media have to be implemented over the coming three to five years. These directives will impact Private Equity investments on various levels and will lead to portfolio reviews, changed capital reserve requirements, different reporting guidelines and a more sophisticated risk management system. Montana Capital Partners’ team members have been involved in working groups in order to find answers for investors in how to implement these regulations more easily. Montana Capital Partners’ services in Portfolio Management and Risk Management help in implementing the new directives and adjust their portfolios based on these new regulatory requirements if necessary.