scott146

Private Equity: Discipline Is Giving Way to Momentum and Euphoria

In the search for yield to meet their pension/return promises, institutions are spreading money around like never before. A large number of public pension funds have announced increased allocations of capital to private equity; no wonder the PE people are focusing getting deals done. If one PE shop doesn't invest the money, the money will be shifted to another shop. This is a re-hash of the dot-com scenario where some investment bankers resisted doing IPO's for companies with no revenue and no cash flow until they saw that the public was snapping up these IPO's and the competing investment banks were making a fortune.