Archive for March, 2007

Private Equity going Public

OK, I’m not speaking of a company privately owned that would filled for an IPO; although it is interesting to note that most of the attention lately has been on the reverse moves. I’m speaking of Blackstone intention to float their shares.

The move is interesting first because Blackstone is one of the biggest Private Equity firm in the world. Second because it could usher a new state of the art in Private Equity. A lot of the major Private Equity firms will soon face the same dilema: how to you turn from a small boutique who’s grown huge into a well-run professional company. Buy-Out firms, does this remind you something? The fact is that a lot of the current biggest PE firms have been founded in the last half-century by a bunch of financial entrepreneurs. A lot of these entrepreneurs are now reaching an age where most of the people already retired. So you have to solve a transition problem.

I find interesting that Blackstone decided to turn to the Public Market to solve this cash-out / maturity conundrum. I would find even more inspiring if the Carlyles of this world decided to turn Blackstone back from Public to Private in order to boost performance after a while; and educating if a Carlyle gone public ends-up merging with our frontrunner Blackstone.

Private Equity backing serial Movie Directors

A recent article in The Economist called Hollywood’s new model (premium access required) is reporting the interesting trend that Hollywood film funding is taking more and more the private equity approach. Apparently some funds found an opportunity to change the investment process in Tinseltown and take their profits out of a risky business by applying some standard methods: bank on the directors with a track record (even slightly tainted), be ready to invest in unproven ones (if they are cheap). This notably differs from the old investment process: do not be seen with a looser, do not bank on the unbankable. But this clearly resembles the methods applied in high-tech: backing an entrepreneur with a mixed record is better than backing a rookie (if he is cheap), banking on a rookie is an alternative (if he is really cheap).

 Maybe Entrepreneurs will never enjoy the glamorous lives of movie directors marrying their gorgeous lead actress but they may take some comfort in thinking they do not have to invite the board to their wedding party.

Using CRM during the day, and VRM at night?

VRM is a new term (no I do not mean Virtual Reality Modeling) coined for Virtual Relationship Management. So while you may be using a CRM system at your company to extract the last penny from your reluctant customer base, you may now decide to use your own information at night to try getting a better deal from this annoying salesman that is hassling and chasing you even into your den.

It seems that a new company Attention Trust has decided that our attention is a precious good and that we should receive a fair return for having to read, listen or just bother with the message the persistent salesman is trying to impose on us. This clearly belongs to this new VRM trend.

 If you are more specifically interested by VRM applied to banking, then you should definitely read Colin Henderson’s post on The Bankwatch. If you are more than interested by BankingVRM, you should then join BarCampBank‘s workgroup on the subject.

 Finally, there is Project VRM a project hosted by Harvard University.

 We’ll see if we has customer will be able to regain the upper-hand in the selling process. But at least it is reassuring for people who may fail to make theirs quotas because of inadequate CRM systems, that they can recoup part of the money by negotiating hard when they buy their next kitchen set.