Pensions & Investments held its first LinkedIn Live event of the year last month, focusing on the current status of the private equity market.
Kendra Corbett, partner of Cloverlay, and Eric Taylor, founder and CEO of Trident, discussed the private equity market's slowish recovery, the targeted opportunities as well as the headwinds facing the industry over the past two years — which include rising interest rates, persistent inflation, widely divergent valuation expectations and heightened regulatory scrutiny.
Corbett and Taylor are optimistic on private equity this year. Cloverlay's portfolio involves exposure to niche strategies, which is frequently absent from institutional private equity programs, she said. Corbett highlighted Cloverlay's investment in digital infrastructure and the spillover effect of the AI boom.
"Most of the segments that we target are really off the radar screens of mainstream private equity … we've made these investments five or six years ago that are getting a lot more attention today," Corbett said.
Cloverlay historically made investments in "things like dark fiber networks that connect the world's largest data center market or investment data centers themselves," she said.
"Today, you have massive multibillion-dollar infrastructure funds that are being raised and a lot of that is being driven by the AI-related tailwinds, where a new data center that is being built today to power AI requires six times the power that was required to run a data center as recently as like two years ago," she said. "It's really a whole new paradigm."
Asked about whether the NFL will allow private equity investment, Taylor of Trident believes it will eventually occur. "I remark all the time when folks say technology is eating the world, I sort of reply 'well, in fact, private equity is,'" he said. "We manage money for foundations, endowments, pensions and what we're really talking about is, over time, democratizing asset allocation to a wider group of people. It is only a matter of time 401(k)s are invested in private equity."
P&I will be presenting monthly LinkedIn Live events throughout the year. Senior reporter Rob Kozlowski talked with Teresa Ghilarducci on March 6.