A fresh article in the NY Times describes the direct investment trend as it is unfolding in Family Offices in the US. The direct dealmaking is evident not only among pension plans, SWFs, and endowments but also family offices, it seems. The article entitled, Never Mind Stocks.
Just Buy the Company, provides some insights on challenges for FOs, such as dealflow, due diligence, and illiquidity risks. Some FOs profiled are doing direct deals related to how the family originally made its fortune, which makes sense, and others invest in debt product, real estate, and property.
The same publication has an in-depth look at the SEC’s investigation of PE fees, the hidden ones, the seemingly unfair ones, and the transparent ones, entitled The Deal’s Done But Not the Fees.
Both articles are recommended due to the depth of reporting. It is worth noting that the mainstream press usually only covers private equity when profits are quite high (or exceedingly low – like during the dotcom bubble and the post-financial crisis era, respectively), or when PE is under public scrutiny. These days two conditions, high returns and high level of scrutiny, are met in the US PE market.