Strategy and Business Model
Seeking to maximise capital growth
We aim to deliver attractive and consistent returns to shareholders over the long term, and at relatively low risk.
An investment in PIP offers shareholders exposure to a growing market that is expected to exceed c.$11.97tni of assets under management globally by 2029 where the best private equity managers might otherwise be in accessible to shareholders.
It is our mission to generate sustainably high investment returns through a well-managed, institutional grade portfolio built by investing with the best private equity managers globally. PIP’s manager, Pantheon, has a well-established platform built on three strategic pillars of primary, secondary and co-investments, with each offering their own merits. We believe that by combining the three ways of accessing private equity investments, we are able to:
- Build and maintain a well-balanced portfolio in a combination that we monitor and manage with the aim of maximising capital growth;
- Manage the maturity profile of our assets so that our portfolio remains naturally cash-generative on a sustainable basis;
- Ensure that the vehicle remains as cost-effective for our shareholders by reducing any potential drag on returns.
As portfolio companies are sold by our private equity managers, PIP’s share of the cash that is generated from those sales is deployed into new investment opportunities.
Business Model
Our investment process
01
Deals are originated via Pantheon's well‑established platform
02
Within our diversified portfolio, we aim to back the best managers globally that are able to identify and create value in growing companies
03
Cash generated when those companies are sold is returned to PIP and redeployed into new investment opportunities
Our Investment strategies
Co-investments
We invest in a company directly, alongside a private equity manager.
- Direct investment in individual companies that have attractive growth characteristics and have effectively passed through two layers of scrutiny, alongside PIN’s leading private equity managers.
- This boosts the performance potential as an individual company investment has been selected by Pantheon, rather than it being part of a fund, and there are typically very low or no fees, making it a cost-effective way of capitalising on the high value added by PIN’s selected managers.
- Co-investments are through invitation only and are therefore not accessible to most investors.
Primaries
We invest in a new private equity fund when it is established.
- We capture exposure to leading managers as well as to smaller niche funds that are generally hard to access.
- We target leading managers predominantly in the USA and Europe.
- Primaries invest capital into companies over an investment period of typically five years, providing steady deployment over time and diversification by vintage year, sector and geography.
Manager-led Secondaries
We invest directly in a company, alongside a private equity manager, that the manager has already owned for a period of time and therefore knows well.
- We partner with high-quality private equity managers to acquire, as single transactions, their most attractive portfolio companies via a continuation fund.
- Typically, fees are lower than those on primaries.
- This provides an opportunity to invest in an asset that the private equity manager believes has potential for further growth, when the fund in which it is held has limited time or capital remaining to the end of its life.
Fund Secondaries
Fund secondaries involve the purchase of existing investor interests in private equity funds. Rather than investing in companies directly, secondary fund investors acquire stakes in funds that are already part way through their lifecycle, often with partially or fully deployed capital.
- Our fund secondaries are interests in high-quality private equity funds, providing liquidity to existing investors who seek an early exit.
- These transactions offer enhanced visibility into the underlying portfolio, as many of the assets are already acquired or realised.
Objective and investment policy
The Company’s policy is to make unquoted investments. It does so by subscribing to investments in new private equity funds (“Primary Investment”), buying secondary interests in existing private equity funds (“Secondary Investment”), and acquiring direct holdings in unquoted companies (“Co-investments“), usually either where a vendor is seeking to sell a combined portfolio of fund interests and direct holdings or where there is a private equity manager, well known to the Company’s Manager, investing on substantially the same terms.
The Company’s policy is to adopt a global investment approach. The Company’s strategy is to mitigate investment risk through diversification of its underlying portfolio by geography, sector and investment stage. Since the Company’s assets are invested globally on the basis, primarily, of the merits of individual investment opportunities, the Company does not adopt maximum or minimum exposures to specific geographic regions, industry sectors or the investment stage of underlying investments.
How we manage risk
Navigating the challenges and mitigating the risks
As with any investment type, there are a number of risks in private equity. PIP has a robust approach to managing risk at all stages of the investment process.
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