Trends Watch: July 20, 2017

EisnerAmper’s Trends Watch is a weekly entry to our Alternative Investments Intelligence blog, featuring the views and insights of executives from alternative investment firms. If you’re interested in being featured, please contact Elana Margulies-Snyderman.  

This week, Elana talks to Jeff Baehr, Founder & CEO, RueOne Investments. 

What is your outlook for alternative investments or, more specifically, private equity?

While there is strong demand for compelling risk/adjusted returns through alternative investments, many firms focused on public markets have underperformed passive strategies over the past several years. This had led family offices and institutional investors to the private markets, but they have become increasingly weary of funds and seek to invest directly into companies or through co-investments.

How are investors approaching private equity investing differently than they have in the past?

Choice, transparency, fees, corporate governance, mitigation of the j-curve and returns have become increasingly important as investors increase in sophistication and alpha gets more difficult to find. Some investors are bringing transaction teams in-house in addition to working with their existing GPs, independent sponsors, syndicates, and boutique banks to source direct and co-investments.

What keeps you up at night?

We are bottom up investors and while we are cognizant of market cycles, we believe they are difficult to pinpoint. We underwrite our investments with 2008 in mind.