Danai Musandu, Vice President of Investor Relations at HPE Growth, discusses the transformative shifts occurring in the private equity (PE) industry, including generational changes, decentralization trends, the influence of cultural icons, and the future metrics of success.
- Generational shift in PE funds:
- Younger capital managers who are also cultural icons are shaping the PE industry.
- Four key areas where the generational shift is evident: cultural icons in finance, impact investing, democratization of access, and tech entrepreneurs shaping investments.
- Decentralization and elimination of middlemen:
- Trend to eliminate middlemen and take hold of one’s destiny.
- AIs and decentralized finance (DeFi) are changing the game, providing increased access to information and transparency in investment processes.
- TikTok Finance and cultural icons:
- TikTok is democratizing financial knowledge.
- Influencers like Kim Kardashian bring attention to the industry and influence how other PE firms approach investments or partnerships.
- AI in deal sourcing:
- AIs have an increasing role in PE, providing opportunities in deal sourcing.
- A combination of buying, building, and customizing tools is needed to adapt to evolving technologies.
- Rethinking metrics of success in impact investing:
- Impact investing should be included as a traditional asset class and more widely applied across asset classes.
- Equitable access should be considered a vital indicator of success.
- Tech and analytics stack:
- A versatile approach using a combination of buying, building, and customizing tools is utilized at different stages of the investment process.
- Collaboration with external consultants is embraced for specialized needs.
- Outlook for 2024:
- Further consolidation in the market is expected.
- Opportunities for purpose-driven firms and the entry of more celebrity-type/TikToker investors.
Danai Musandu is navigating the future of private equity with a deep understanding of ongoing shifts and a critical commitment to shaping the industry’s future.
