Your once-a-month insider on talent + alternative investments.
The Locke-Down is a once-monthly newsletter for our closest contacts on topics related to talent and alternative investments. The newsletter covers 3 simple things:
What we’re hearing in the market,
What we’re reading, and
What we’re up to.
We want to hear from you. What information would be valuable? Get in touch with us.
What we’re hearing
Cockroaches? Bank and Private Credit executives Jamie Dimon, Marc Rowan and Jonathan Gray pointed fingers after the First Brands and Tricolor failures. Even if those deals were largely bank-led, all eyes are on Private Credit. So, are there more cockroaches? If there are, sponsors will keep them under control (or keep them out of sight). We hire for Direct Lending and Opportunistic Credit investment teams. In Direct lending, we keep hearing about spread compression and weakened legal docs. At the same time, our clients in Opportunistic Credit also see a target-rich environment. The Private Credit industry is overwhelmingly sponsor-driven. Like they do with their direct lenders, sponsors will call a small number of capital solutions providers when they need workout financing. The process will be controlled, discreet, and sponsors will (largely) attempt to shield their preferred lenders from embarrassment. We will continue to see the need for asset management and restructuring professionals in direct lending. Likewise, we expect flows to continue to opportunistic credit and capital solutions funds with sponsor-friendly strategies.
Year-End Bonus Expectations Up for Private Markets. We are starting to hear consistent optimism about year-end bonuses after a busy summer for private equity and private credit professionals. One Managing Director in Private Credit expected bonuses to be up about 15% vs. FY 2024. More on this to come as we get closer to year-end.
Independent Sponsors Thrive in the LMM. Though the deal dam may be breaking, PE fundraising faces continued headwinds. In the lower middle market, LPs have shown preference to deploy capital on a deal-by-deal basis. As we highlighted in August non-sponsored LMM deals are taking the stage in private credit. Senior direct lending professionals who can originate from independent sponsors and founders, not just financial sponsors, are showing their value.
What we’re reading
(Bloomberg) Paul Singer’s Elliott Is Raising $7bn For A War Chest
(Bloomberg) Ken Griffin Says GenAI Fails to Help Hedge Funds With Investment Ideas
What we’re up to
The Locke Group proudly sponsored the Chappaqua Ragamuffin Parade. It was a great reminder that investment in community is another way of investing in people.
Consulting with our clients on year-end compensation. Do you have team- or level-specific compensation questions? We may have relevant compensation benchmarks. For anything especially sensitive, we can work with you to gather a live sample of relevant data points.
Conducting compensation surveys in Private ABF investing and Investor Relations, across PE and Credit. Please say hello if you’d like to participate.
Search Spotlight – Metropolitan Partners Group Hires Sydney Ahmed
We are excited to shine a spotlight on Sydney Ahmed and Metropolitan Partners Group (MPG).
Sydney joined MPG’s Asset Management team as a Senior Associate.
MPG lends to non-sponsored, growing companies in the lower middle market. MPG needed a Restructuring Advisory professional with meaty company-side experience, the gravitas to consult directly with portfolio company executives in critical growth and turnaround situations, and the grit to fit the firm’s New York culture. Sydney is the perfect fit.
She joins from FTI’s New York team and will work closely with Alex Verba and Anthony Siragusa as they expand the portfolio.
Congratulations!
Sincerely,
The Locke Group