Lukasz Garbowski

Oaktree just posted a job for “SVP, Head of AI” with a base salary of up to $225,000. This is one of the largest investment firms in the world, with over $200 billion in assets under management, hiring for what will be one of the most consequential roles of the decade… at a compensation level barely competitive with mid-level engineers at OpenAI or Anthropic. The mismatch says everything. AI will reshape every layer of capital markets, from risk modeling to deal sourcing to asset pricing. It’s not a “tech add-on.” It’s the new foundation of value creation. OpenAI and xAI are paying $800K–$1.5M for senior AI engineers. Meta reportedly offered nearly $1 billion in total compensation to poach top AI researchers from rivals. Even Disney offered more for its “VP of Collaboration and AI”. Meanwhile, legacy finance still views AI as an IT function rather than a strategic capability. That gap is the opportunity. The next era of investment firms will be built by those who see AI not as a tool, but as the strategy itself.

1,785

245 Comments

The VC secondary market is on fire. But many LPs are rushing in without fully appreciating the risks. VenCap International plc has been active in VC secondaries (LP positions only) since 1987 — and this is one of the hottest markets we’ve seen. In the first half of 2025 we reviewed $6.5bn of secondary VC deals — a 41% jump from the $4.6bn we saw in the same period last year. This includes both GP-led and LP-led deals. Here are 4 lessons we've learned from nearly 40 years of buying secondaries: 1️⃣ Power law still rules – a few companies will drive most returns. 2️⃣ Quality over discount – our best deal was bought at a premium to NAV. 3️⃣ Know the valuation policy – different VCs can value the same company very differently. 4️⃣ Factor in manager behavior – holding winners vs. selling early can make or break returns. VC secondaries ≠ PE secondaries. The risks are different — but for LPs who can access the right deal, at the right price, the rewards can be exceptional.

158

17 Comments

It’s no longer enough to just buy well and hope for multiple expansion. Time to roll up your sleeves. GPs have been hearing this from LPs for years — especially during fundraising. #Operational value creation has become the main act in private equity, not the footnote. Why? - Because with rising competition, more dry powder, and tighter exit markets, helping your portfolio companies actually improve is the only real edge left. I’ve kicked off a short YouTube series on how experienced funds approach value creation — where it starts, what works, and what LPs are now asking about in diligence. We started with a fireside chat featuring Anne Arlinghaus from KKR Capstone (link below in comments). In Part 1, I cover: • Why the real work begins long before the ink is dry • The go-to value levers (and why overhead reduction is just the start) • How firms are building internal ops teams — and tracking impact If you’re curious what “hands-on” really means — or what it takes to become an Operating Partner — this one’s for you. 🎥 Watch the full video here: https://lnkd.in/drfgcsMV Next up: Buy & Build — and yes, it’s as messy as it sounds. #PrivateEquity #ValueCreation #OperationalExcellence #PortfolioCompanies #GPstrategy #LPperspective #INSEAD Arnaud Bonzom Bowen White Michael Prahl Harsh Temurnikar @

293

20 Comments

𝐏𝐄 𝐯𝐬. 𝐕𝐂 𝐢𝐧 𝐄𝐮𝐫𝐨𝐩𝐞: 𝐀 𝐭𝐚𝐥𝐞 𝐨𝐟 𝐭𝐰𝐨 𝐟𝐨𝐨𝐭𝐩𝐫𝐢𝐧𝐭𝐬 Our latest data at Gain.pro highlights how PE and VC firms invest across Europe: ▪ PE-backed businesses are widely spread across the continent ▪ VC-owned assets are clustered in cities 📊 Sector focus drives this: – VC assets = 47% TMT (vs. 17% for PE) → drawn to innovation hubs – PE = 24% Services + 22% Industrials (vs. 13% & 7% for VC) → broader geographic reach beyond capitals 🌍 Top destinations: – Both: London & Paris lead – VC: 25% of assets in 11 cities (Berlin, Munich, Amsterdam next) – PE: 25% spread across 22 cities (Stockholm, Milan, Madrid stand out) ➡️ Same continent. Very different maps.

84

2 Comments

Margin Expansion: How Big a Driver For Value Creation? Margin expansion accounts for just 14% of private equity value creation — the smallest of the three key levers. Its impact is highly concentrated in specific deal types and situations. The PE playbook has evolved over the years. Today's private equity strategy focuses primarily on acquiring best-in-class businesses and scaling them, rather than the traditional turnaround model. Top-quartile businesses offer limited operational improvement opportunities, which explains margin expansion's smaller overall role. The real margin expansion opportunity lies with underperforming assets. The data clearly shows this. Among deals with negative EBITDA margins, 78% achieved meaningful margin expansion with a median improvement of 1,250 basis points. Public-to-private transactions show the highest margin expansion potential. Sponsors often identify inefficiencies as part of their investment thesis that they can address away from public market scrutiny and quarterly earnings pressure. Similarly, carve-out transactions also outperform other deal structures in margin improvement. By sector, Energy & Materials, Industrials, TMT, and Healthcare show the highest margin expansion, with asset-heavy sectors such as Energy and Industrials particularly benefiting from scale advantages and operational optimization opportunities.

55