Foundations of Private Capital

• Welcome tea and coffee
• Introductory session – Welcome from the Chair/CEO of AIC – 15 mins
• Overview of course program, importance of industry code of conduct and professional standards

Content: Negotiation skills workshop / Group icebreaker

• Group breakout activities

Introduction to private capital, why, how and types of capital to managers

• Industry Overview
• Why alternatives? The Private Capital Ecosystem: Private Equity (PE), Venture Capital (VC) and Private Credit (PCr)
• Sub-strategies explained through compare and contrast: management buyout, leveraged buyout, growth capital, distressed and turnaround investing.
• Global market size, features of each, overview of fund managers operating in each segment and the different strategies.

• Fundraising
• Role of Limited Partners, Institutional Investors and Fund of Funds – what are investors looking for?
• Where Private Capital in Australia sits in the global investment and funds management industry.
• Investment models and criteria to assess GPs.
• Evolution in nature of relationship between GPs and LPs, partnerships, co-investments, and direct investments.

• Investment Returns
• Risk and return.
• Alternative capital.
• Valuation of private companies.

Learning Outcomes:

• An in-depth understanding of the unique attributes and differences in approach as between the various sub-strategies within private capital: PE, VC and Private Debt.
• Understanding of the unique features and challenges of turnaround and special situation investments.
• Understanding the differences between management and leveraged buyouts, growth and expansion capital, and private credit investments.
• An in-depth understanding of the fundamental principles of a ‘partnership’ between Limited Partners and General Partners, and the unique attributes of each other’s role in the relationship.
• A solid understanding of the lifecycle of deals and the typical components of a deal execution process.

Focus on buyouts

• Structuring the transaction – Types of buyouts
• Explaining the types of buyouts, including:
• Corporate carve out.
• Public to private.
• Secondaries.
• Buyout of a family run business.
• Origination - Sourcing the deal.
• Due diligence.
• Deal structuring.
• Deal pricing.
• Finance and debt capacity.
• Management incentives.
• Structuring the transaction – Private credit.
• Role of private credit versus other forms of financing/lending
• Typical structures and differences between lending facilities.
• Active engagement with portfolio company management teams.

Learning Outcomes:

• A fundamental understanding of the typical features of deal structures in Australia, and the drivers for those structures from a financial and non-financial perspective.
• Understand the stages of a large buyout deal from origination, due diligence and deal structuring.
• Understanding the differences between different categories of buyouts investments.

Focus on Private Credit

• Debt & Leverage.
• Private Debt.
• The Ecosystem.
• The Process - Structuring the transaction.
• Role of private credit versus other forms of financing/lending.
• Typical structures and differences between lending facilities.
• Active engagement with portfolio company management teams.

Learning Outcomes:

• Understanding how private debt works in the private capital industry.
• How private credit investments differ from leveraged buyouts and growth and expansion capital. Making the best decision using your judgement

Responsible investment principles and practices

• Responsible investment principles and practices
  For each session provide a scenario, group breakout, groups present their point of view – discussion.
• Environmental, Social and Corporate Governance.
• Social impact.
• Diversity and inclusion.

Learning Outcomes:

• A fundamental and practical understanding of how to negotiate effectively to achieve desired outcomes.
• A fundamental and practical understanding of responsible investment strategies, incorporating ESG, social impact and diversity and inclusion principles, and how such practices can be embedded into the day-to-day activities of successful private capital investment firms.
• A fundamental and practical understanding of LP expectations around such practices in the context of institutional domestic and international fundraising, and the day-to-day activities of investment firms and their portfolio businesses.

Focus on venture and growth

Structuring the transaction – Early-stage investments

• What is VC, difference between institutional VC and corporate VC?
• Key consierations
• Origination – Sourcing the deal.
• Due Diligence.
• Enhancing upside / protecting downside.
• Funding instruments
• Subsequent funding rounds.

Learning Outcomes:

• A fundamental understanding the different forms of early-stage investment from seed stage to later funding rounds, and the typical features of deal structures used in venture investing.
• Understanding of the core differences and strategic drivers behind institutional VC and CVC investments.

Focus on Growth Capital

• Structuring the transaction – Growth caoital.
• Explanation of growth capital investment strategy as compared to leveraged buyout.
• Structuring the transaction.
• Working with entrepreneurs and owner/managers.

Learning Outcomes:

• Understanding the differences between leveraged buyouts and growth and expansion capital, and private credit investments.

Driving value in portfolio companies

• Managing the Portfolio 1
• Different approaches
• How to implement value creation tools
• Risk management
• Time management
• Your role
• Information flow

Learning Outcomes:

• A fundamental understanding of the approaches to managing portfolio businesses.
• Understanding of the unique features and challenges of turnaround and special situation investments.
• A fundamental understanding of how value is created within portfolio businesses, and the breadth of tools available to GP firms to create and enhance enterprise value in a sustainable and repeatable manner over time.
• Understand the role that operating teams can play in driving performance within portfolio businesses.

Driving value in portfolio companies (continued)

• Managing the Portfolio 2
  For each session provide a scenario, group breakout, groups present what they would do – discussion.
• Strategy, how to evaluate and when to pivot.
• Performance management and culture.
• Reporting to the CEO and the Chair.
• When things go wrong, early warning signs.
• Making the best decision, using your judgment
• When to back the CEO, when to change
• Board performance and non-executive directors

Learning Outcomes:

• A fundamental understanding of how to oversee the performance of a portfolio measured against the commercial and strategic investment thesis.
• A fundamental understanding of the different mechanisms available to monitor and manage business performance, and the levers available to shift business strategy where required.
• A fundamental understanding of how to make decisions when the scenario is unclear, when to ask for help and when to trust your intuition.

Driving value in portfolio companies - Exits

• Exits – Creating liquidity events and realising investments
• Strategic decision points around exits.
• Exit routes and pathways.
• Market implications and timing.
• Evaluating management and executive performance.

Learning Outcomes:

• A fundamental understanding of the different mechanisms available to create liquidity events through full/partial exits, including the importance of market timing and market sentiment considerations in determining the most appropriate exit pathways for specific portfolio businesses.

GROUP WORK CASE STUDY 1 – Growth Capital deal simulation

Pose questions and decisions, role play, cementing hard skills covered in previous sessions.

Learning Outcomes:

• A fundamental understanding of the typical features of deal structures in Australia, and the drivers for those structures from a financial and non-financial perspective.
• Understand the stages of a large buyout deal from origination, due diligence and deal structuring.
• An in-depth understanding of the fundamental principles of a ‘partnership’ between Limited Partners and General Partners, and the unique attributes of each other’s role in the relationship.
• Understanding the differences between different categories of buyouts investments.

GROUP WORK CASE STUDY 2 – Venture deal simulation

Pose questions and decisions, role play, cementing hard skills covered in previous sessions.

Learning Outcomes:

• Compound previous accumulated learnings through application in an earlystage investment group case study and deal simulation.
• Insights obtained from industry experts delivering the deal simulation, asking questions, decision making, working with others and presenting to the group.

Course summary and key learnings to take away.
Navleen Prasad (AIC – CEO)

• Reflections and review.
• Questions & Answers
• Appreciation and Certificate presentation.
• Group photo

Scott McKnight
Director
Pacific Equity Partners

Anne-Marie Birkill
Co-Founder, Venture Partner
and Director
OneVentures

Jonathan Ramasamy
Associate Director
Black Kite Partners

Paul Evans
Founding Partner
Ironbridge

Uddhav Bhargava
Associate Director
Allegro

Nicole Connolly
Senior Investments Professional

Karen Chan
Portfolio Manager
Perennial Partners

Theodore Sun
Associate Director
Allegro Funds

Marcus Simpson
Consultant
PMGS Global

Tim Dillon
Principal
Ares Management