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  "documentTitle": "ey ivca monthly pe vc roundup december 2022",
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      "text": "For PE firms to transform to meet the challenges of the next wave, they need to apply the skills they use on their portfolio companies to themselves.",
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      "text": "This does not mean PE firms can rest on their laurels - far from it. The factors that got PE to this point are not the ones that will take it into the future. The environment has changed significantly from when the PE model was first deployed at scale.\n\nThe market is becoming crowded as new competition enters the space. According to Preqin, there are now more than 7,000 active PE firms operating throughout the world. In this new landscape, PE firms must find ways to differentiate themselves and reinforce the value they can bring. Firms need to develop new skillsets and new ways of relating and connecting to their investors, their employees, the businesses they partner with, and the community at large.\n\nAs this paper has shown, megatrends are forcing their hand. PE firms need not only to invest in digital to improve their proposition and make it more relevant, but also to recruit the talent with the right skills to make it happen. To attract that talent, the firm must put the right culture in place, and this may require an overhaul of the organizational structure.\n\nDiversity, equity and inclusion are key factors - not just tokenism, but a realization that, in this new world, they are essential components of a progressive, innovative, and ultimately successful business.\n\nGrowing interest from a wider range of stakeholders will cause PE firms to place a greater emphasis on ESG elements in their investment strategy. PE firms will need to rethink what it means to create value for these stakeholders and look further than just financial return. Regulators, and society in general, are also increasingly focused on responsible investing.\n\nAs with any industry transformation, there are immense challenges that will require major shifts in thinking and culture. The PE industry is no different. However, it is worth remembering that PE has built its business around helping companies to transform themselves and adapt to changing conditions. There is no reason that it cannot now employ those same skills in relation to its own model.",
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      "text": "There is no denying the phenomenal growth of the PE industry. According to Preqin estimates, over the past decade, assets invested in PE and related asset classes have grown from US$1.7b to more than US$4.4t. Most significantly, assets under management are expected to exceed US$9t within the next five years. Including the entire universe of alternatives drives estimates past the US$17t mark - more than the combined GDP of Japan, Germany, India and the UK. However you look at it, it is a tremendous evolution for an industry that is, in its modern form, just three decades old.\n\nAs PE has grown over the last 20 years, the number of publicly listed companies in the US has declined by half. Similar trends are evident in Europe and are starting to be seen in Asia. In short, private capital sources are supplanting public ones.",
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