Location, talent will define Asia's GP winners - AVCJ Forum

Speaking at the AVCJ Forum in Hong Kong, Marshall Parke, managing director with Lexington Partners, described a market in which GPs are under increasing pressure from larger US and European firms with enormous resources and experience at their disposal.

Rodney Muse, managing partner with Navis Capital Partners, said part of the reason his firm continues to survive in this increasingly competitive environment is because it is locally driven.

"We are all about shoe leather in the street, identifying deals, and trying to preempt processes," he said. "I think that is different to the basis on which most buyout big buyouts do deals - which is often through connection at very senior levels of government and business, and good relations with investment banks."

Rob Petty, managing partner and co-founder of Clearwater Capital Partners, also emphasised the importance of being local but stressed that a true local strategy is hard to execute.

"There is one simple rule: it can only work in Asia if your investment committee, your deal team and your actual decision-makers eat, sleep. and wake up in an Asian time zone," he said. "If you are waking up at and presenting your case to a New York-based team at midnight - you are not going to be a competitive player in Asia."

While some buyout firms were able to bridge the gap, Petty sees them as the exception rather than the rule. David Shen, Asia managing director with Olympus Capital added that, although much has changed in the region's private equity market, "entrepreneurs and founders still want to deal with the decision makers."

However, Charles Ong, co-chairman and co-CEO of RRJ Group said the bigger issue came down attracting and retaining the talent required to build a strong regional presence.

"I think more competition reinforces this need," he said. "The challenge for any organization is to keep the best talent you have and convince them that this is the place you want to work for rest fo your life and not just until the next round of carry gets paid."

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