VIDEO: Bain Capital's Stephen Pagliuca

"We've always had a lot of co-investments, either by LPs or by other private equity shops, given our fund sizes over the history of time have been a little smaller than the others," he says. "We are used to that. We see it as a continuing trend and dynamic. Right now some of our largest LPs would like to co-invest and because our funds are smaller we have a vehicle to do that."

Pagliuca notes that Bain has never viewed itself as a big buyout firms: it targets a wide variety of deal sizes, including venture capital, and it is not a public company. There are currently no plans to change this.

"By happenstance the larger firms are listed and we have assets comparable to those. That is a strategic decision that each firm has to make. Some of that is driven by liquidity needs for founders. We haven't had that in our firm - we have a broad group of ownership," he explains. "The way we look at that decision is: Will that help our investors? We have found right now that we can operate without being public; we have no need for capital. So right now we find it a competitive advantage to be private."

Similarly, Bain is unlikely to follow the trend that has seen several of the world's largest private equity firms and become a multi-strategy asset manager that raises capital - from the retail market as well as from the traditional LP base - for a wide variety of products. Pagliuca describes the firm has a hybrid in that it tries to operate as a series of smaller funds but its combined assets are of significant size.

"Our philosophy is to get into product lines that have this analytic capability where we can outwork other people, out analyze the competition and get great returns for our investors," he adds. "That will dictate what our fund sizes are. We are not trying to be the biggest; we are trying to be the best."

Pagliuca will be making a keynote address at the AVCJ Forum in Hong Kong, which runs from November 3-5. For more information, please go to www.avcjforum.com.

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