Opinion
Giannini: Private equity marks are legitimate and outperformance is real
“So I think what you're seeing in the private markets is actually what's happening. It's not that the value's Are inflated, or there's a lag factor. They're legitimate valuations, and it's why, by the way, you're in private equity. It just, sorry, it performs b…”
Prediction Held up
Giannini: A Broad Distressed Debt Cycle Will Not Materialize
“There's not going to be a distress cycle. Sorry, there'll be some distress deals that are interesting, I'm sure, but you sort of had this period where, oh my gosh, things are going bad, let's raise a distress debt fund, and they still are trying, but just tell…”
Opinion
Giannini: The 2008 financial crisis was private equity's best event
“That is when, to me, private equity, private markets established themselves. It was the greatest thing that happened to the industry. And I know people will go, that asshole, what's he saying that for such a horrible time. But it's because at that point, every…”
Opinion
Giannini: LP advisory boards are a total waste of time
“I think advisory boards are a total effing waste of time. I have learned nothing. Here's what I've learned. Zero. Advisory boards are a place where LPs want to feel important and feel really good, and GPs want to make them feel important and really good, and s…”
Prediction Not checkable as stated
Giannini: A Large Number of Venture-Backed Companies Will Fail
“I think certainly on the venture side, there's no doubt that you're going to see a lot of venture companies just hit the wall.”
Prediction Not checkable as stated
Giannini: Recent PE Vintages Will Deliver Lower IRRs and Disappointing Returns
“We will have elongated hold periods, which means IRRs are coming down. Now, presumably the public market returns are also coming down from what they were the last five, 10 years. But I think people need to recognize that. I know general partners in particular …”
Insight
Giannini: Private Equity Has Outgrown LP Capacity to Fund GP Ambitions
“The industry has simply outgrown both in terms of its size and its desire for more size. Has outgrown the limited partner capacity to fund it for a period of time. There's just not enough money in the world to give GPs everything that they want, whether it's a…”
Opinion
Giannini: High equity cushions will protect private credit from broad losses
“We have had more equity in companies than we've had in prior cycles. So if we think about the risk to the credit compared to what it was in The risk going forward of deals that have been done is more on the equity, I believe, than on the credit. The credit is …”
Insight
Giannini: Most institutions lack the resources to pick direct co-investments
“The reality is for most institutions, not all, but for most institutions, they're simply not resourced enough to do co-investments. And so our view is they either ought to do every co-investment that walks in the door and just make sure you do enough of them, …”
What-if
Giannini: An ESG Filter Would Have Prevented Investors From Backing FTX
“It wasn't a fraud issue. It was a pure governance issue. If people had an ESG filter, they'd have never done that deal ever.”
Prediction Not checkable as stated
Giannini: Global Tech Leaders Will Split Into Regional Entities Like Apple
“If you wanted to make money in smartphones, 20 years ago, whenever it was, you invested in Apple, and you had a global industry leader. That's not going to happen anymore. You will have Apple US, Apple China”
Insight
Giannini: PE Outperforms Public Markets Due to Superior Corporate Governance
“Private equity outperforms because it's a better form of governance, period. I mean, I get the leverage and I get all that other crap, but it is a better form of governance. You'd much rather be private than public in terms of your ability to do things.”
Opinion
Giannini: Private equity brings intense public dislike upon itself through arrogance
“This is an industry that is really disliked. It's extraordinary how, how disliked we are, and we do it to ourselves. We do it to ourselves with the amount of money that sloshes around and the way generally as an industry we act like, well, we deserve it becaus…”
Insight
Giannini: Private investors overemphasize entry valuation to their own detriment
“And so I think from a pricing perspective, we spend so much time on pricing and obsess on it as the only thing that matters, and it just is not. It's important, especially at the extreme. So late last year, especially in some of the high growth areas, you kind…”
Assertion Not checkable as stated
Giannini: Private equity GP-to-GP deals deliver the same returns as other exits
“We've run numbers. The return is basically the same. There's no real difference between A GP to GP deal return and a non-GP to GP deal return. So there's no advantage or disadvantage.”
Prediction Not checkable as stated
Giannini: LP Overallocation and GP Fund Expansion Will Cause an Inevitable Shakeout
“It's kind of this two forces colliding, and I think it's going to lead to a reasonable shakeout under any market scenario. I don't care if the market Flattens out here, goes up here a little. It will take a market going up 50% for some of this to ease, and tha…”
Prediction Not checkable as stated
Giannini: Venture capital is entering a difficult five-year downturn
“That cyclicality has not been changed, and I suspect we're in for a fairly difficult period of time in the venture world. And unfortunately, That takes time. Look at the 2000 and I'm not at all suggesting we're going to be like 2000. I don't think we are, but …”
Opinion
Giannini: Extending private equity to mom-and-pop retail investors is a bridge too far
“I worry a little bit about the idea that the mom and pop investor, the people who really do not know how private equity works, are all of a sudden going to come into private equity. Man, that just seems like a bridge too far today.”
Prediction Open · timeframe Jul 2037
Giannini: Portfolios will be 50% private and 50% public within 15 years
“I believe in 10 years, 15 years, that portfolios will, by and large, be 50% private, 50% public.”
Prediction Partly held up
Giannini: Global Economies Face Shallow Recession, Not 2008 Crisis
“I think that inflation peaked a while back and is headed down. I don't know if it'll get down to two percent. I don't think it really matters. I think the most global economies outside of perhaps China are going to go into a recession and it will be a shallow …”
Opinion
Giannini: 4% Interest Rates Are Not Catastrophic for Private Equity
“In terms of the financing markets on the regular private equity world, if rates stay where they are, and in my world, obviously, they're not going to go up that much, this isn't catastrophic.”
Opinion
Giannini: Record dry powder indicates a healthy, growing private market
“I would argue it's a sign of a very healthy market and a growing market when you have more dry powder coming in, and that's what's happened in private equity, private credit, all those different illiquid markets.”
Prediction Not checkable as stated
Giannini: LP Capital Crunch Will Pressure Private Equity for Years
“So I think this is really where the industry is going to have a pressure point over the next two, three, four years. This is not a, oh, the market goes up 20% and everything's magically solved.”
Insight
Giannini: PE Investors Should Cut Manager Relationships and Concentrate Capital
“I'm not a big believer in the amount of diversification that most of this industry says you got to have. You have to cut back the number of relationships you have and concentrate them on those groups that right or wrong you believe are going to get you through…”
