Anil Seetharam, Managing Director at Stockbridge (Berkshire Partners), explains how the public equity fund avoids conflicts of interest with Berkshire's private equity strategy.
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“Berkshire private equity tends to invest in smaller businesses has always invested in smaller businesses than we tend to invest in. So there's very little direct overlap in the companies we're looking at.”
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More from Anil Seetharam
Disclosure
Seetharam: Stockbridge sells troubled holdings rather than pursuing activist board seats
“So the key is if we have a problem with the company, it's better for us to sell than it is for us to go on the board and try and change it.”
Anil SeetharamJul 22, 2024▶ 37:24Rob Small and Anil Seetharam - Public Equity Adjacent to Private Equity at Stockbridge (EP.397)
Insight
Seetharam: Public investing gives less data than PE but no time constraints
“In the private equity business, the way it works is you have access to a data room. And you have a certain amount of time to understand as much as you can about a company with full access to the information and the management team. So if you were to use an ana…”
Anil SeetharamJul 22, 2024▶ 14:56Rob Small and Anil Seetharam - Public Equity Adjacent to Private Equity at Stockbridge (EP.397)
AssertionNot checkable as stated
Seetharam: Stockbridge matched private equity diligence conviction on Skillsoft
“There was a business that we were invested in at Stockbridge, a company called Skillsoft. It's an education software business that Berkshire private equity ended up taking private. And we got to see what public information would allow us to understand about th…”
Anil SeetharamJul 22, 2024▶ 15:44Rob Small and Anil Seetharam - Public Equity Adjacent to Private Equity at Stockbridge (EP.397)
Disclosure
Seetharam: Stockbridge Rarely Encounters MNPI from Berkshire Private Equity
“So we found it's extremely rare that we end up with MNPI on a company and the places where we've run into issues They've tended to be opportunities, not conflicts or issues. We've co-invested in things.”
Anil SeetharamJul 22, 2024▶ 21:04Rob Small and Anil Seetharam - Public Equity Adjacent to Private Equity at Stockbridge (EP.397)
Disclosure
Stockbridge has entire team vote on admitting portfolio investments
“As an entire group, we discuss every idea that's making its way into the portfolio from a very early stage, which we call our tear sheet stage, where we're just introducing the whole team to the business to a final investment memo. Everybody from the newest an…”
Anil SeetharamJul 22, 2024▶ 30:04Rob Small and Anil Seetharam - Public Equity Adjacent to Private Equity at Stockbridge (EP.397)
Disclosure
Seetharam: Stockbridge passes on Nvidia because it sits outside its competence
“While let's say a company like NVIDIA is an extraordinary business by all accounts and one we've looked at, we just don't think we would be a great owner of that business at this point in time. Because while I can tell you all the great things about NVIDIA, I …”
Anil SeetharamJul 22, 2024▶ 50:32Rob Small and Anil Seetharam - Public Equity Adjacent to Private Equity at Stockbridge (EP.397)
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