Private Equity Lecture with Gerald O'Dwyer & Mike Lorelli

Introduction

• Presenters: Gerald O'Dwyer and Mike Lorelli
• Focus on insights from private equity (PE) executives
• Aim: Helping executives monetize their backgrounds

Overview of Blackmore Partners Inc.

• Founded in 2005
• Helps executives turn backgrounds into deals
• Founded a talent group in 2007 for PE executive searches
• Blackmore Connects: Networking & education for understanding PE mindset
• Upcoming boutique conferences: Aug 24, Oct 26, Dec 14

Inflation and Job Income Challenges

• Current job income may not keep up with inflation
• Jerome Powell: Inflation expected to continue
• Real opportunity: Own a piece of a deal with equity

Private Equity Community

• 9,000+ PE firms in the U.S.
• Networking and connection challenges
• Tools for networking: conferences, webinars, LinkedIn

Introduction of Mike Lorelli

• CEO of 5 portfolio companies
• Board member of multiple companies
• Insights into PE and board roles
• Emphasis on long-term relationship building

Key Insights on PE from Mike Lorelli

Industry Overview

• Public companies have shrunk, while PE portfolio companies have exploded to over 16,800
• PE focused on returns higher than S&P and Russell 3000

Terminology & Fund Structure

• LP (Limited Partners) and GP (General Partners)
• PE funds: 2% management capital fee, 20% carried interest
• Investment phases: Purchase, Improvement, Sale (Exit)
• Typical transaction journey: 300 teasers -> 1 deal
• PE focus on EBITDA improvement, gross margin, top-tier team, IT systems

Private Equity Focus

• Originated in 1977 by KKR
• Sector specialty vs. Category agnosticism
• PE is everywhere, suited to many sectors
• Focus on time management and efficiency

Performance Measures

• Typical holdings: Multiple small to large companies across different timelines
• Cash return examples: 2x, 5x, exceptionally 11x

Compensation

• CEO compensation in PE may be lower in salary and bonus but higher in equity
• Board roles: Not mandatory to have been in PE before, high turnover in CEOs

Networking and Getting into PE

• The importance of LinkedIn profiles: Optimized headlines, detailed 'About' sections
• Understanding PE's perception of time and efficiency
• Offering deal flow or specialized insight is better than job-seeking
• Approaching PE firms with deal thesis or target-driven deals

Board Certification and Skills Map

• Certification not mandatory but beneficial: NACD, American College
• Skills map: Demonstrate unique value to board from your background

Final Tips

• Networking: LinkedIn as a major platform
• Engaging with non-funded sponsors for deal opportunities

Questions and Closing Remarks

• Questions addressed on finding companies, board roles, deal thesis, sector focus (e.g. energy)
• Encouragement to consistently build relationships in the PE space

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Contact Information

• Mike Lorelli: Super connector on LinkedIn
• Blackmore Partners & Blackmore Connects for further engagement and networking opportunities