Private equity pros have been content to toil away in private, answering to their investors and jockeying for position among their peers. But Mitt Romney’s run for the president has now brought an unwanted spotlight on the industry, and brought critics out of the woodwork.

The presidential debates have already raised public questions about the industry, not the least of which is the 15% tax rate on carried interest enjoyed by private equity managers, reports the Wall Street Journal. The public debate also rages over whether private equity pros are “asset strippers” and job killers, rather than turning around anemic companies for a profit. Surprisingly, some private equity insiders think having Romney in the White House would be bad for the industry.

“We were sitting around, a group of us, four or five months ago and said, ‘Can you imagine how bad it’s going to get if Mitt’s the nominee?” said Christopher Stadler, a managing partner of CVC Capital, at the Dow Jones Private Equity Analyst Outlook conference.

“If we end up with a private equity guy in the White House, it’ll get worse. Not better,” said Mark Yusko, chief executive of asset manager Morgan Creek Capital Management. “Limited partners will be skittish.”

Meanwhile, a new report by law firm Weil Gotshal & Manges LLP says the private equity industry as a whole is poised for a shakeout.

A combination of macro-economic factors, such as the U.S. debt downgrade and the sovereign debt crisis in Europe, together with political uncertainty stemming from the presidential election and regulatory landscape will cause a “sea change” in how private equity operates, say the authors of the report in a Wall Street Journal article.

Top-performing managers will solidify relationships with their investors. Lesser-performing managers will have a harder and harder time raising capital. And the largest players in the market will continue their march toward transforming themselves into “alternative asset supermarkets.”

How are you adjusting your search for a private equity job in light of these industry developments? Add your comments below.

CVC Capital Partners (‘CVC’) is a private equity and investment advisory firm which manages capital from some 300 investors worldwide. CVC Cordatus Group (‘Cordatus’) is an independent asset management which is a subsidiary of the CVC Group. In private equity business, CVC uses its funds to acquire companies in Europe, Asia and North America. In private debt business, CVC Cordatus uses its fund to invest in debt instruments in Europe.

The firm currently employed more than 250 people based in its 20 offices in Amsterdam, Brussels, Copenhagen, Frankfurt, London, Luxembourg, Madrid, Milan, Paris, St. Helier, Stockholm, Zurich, New York, Beijing, Hong Kong, Seoul, Shanghai, Singapore, Sydney and Tokyo.

Founded in 1981, CVC manages capital from its investors which are Public Pension Funds, Private Sector Pension Funds, Financial Institutions, Fund of Funds, Private Individuals, Endowments, Sovereign Wealth Funds and Family Offices / Foundations. Geographically, the investors are from UK, Europe, US & Canada, Asia Pacific, Middle East and Other.

Since 1996, CVC Capital Partners has raised 9 Funds with total commitments of USD 44 billion or EUR 36 billion including CVC Cordatus. The firm invests in various global business sectors including industrial and services. The minimum equity investment is USD 150 million for European funds and USD 50 million for Asian funds.

Some of CVC Capital Partners current portfolios are:
Asia Timber Products, BJ’s Wholesale Club, De Weide Blik & Bocchi (DWB), Gartland Whalley & Barker, Hung Hing Printing Group, Matahari Department Stores, Merlin Entertainments Group, Minit Asia Pacific Co., Nine Entertainment Co., Pilot Flying J, Rizal Commercial Banking Corporation (RCBC), Rocla Concrete Tie Inc. (RCTI), SEAT Pagine Gialle, Smurfit Kappa Group, Sun Hung Kai & Co., Van Gansewinkel Groep and VolkerWessels Stevin N.V.

Some of CVC released portfolios are CPI, Mivisa, Post Danmark, Showa Yakuhin Kako Co., Ltd., Skylark, I-MED, DYWIDAG-Systems International (DSI) and GS Paper & Packaging (GSPP).

Earlier this week, members of the Venture Capital Lunch Club met for their annual luncheon at a law firm in downtown New York City to make their predictions for what could be the hot areas for venture capital jobs and investment this year.

Number one on the list is “Big Data”, which involves ramping up the processing power of sorting through mountains of consumer data. Previously, it had been too expensive or had taken too long to sort through all this. But today’s new hardware, cloud architecture and open source software make it much more affordable. Companies like Walmart or Google and even smaller firms can now analyze the data to discover shopping patterns or create new products. And since they are working with actual customer data, it is presumably more accurate than using surveys.

Venture capital firms will be focusing on startups that are working with the predictive nature of Big Data, says Peg Jackson of Gridley & Co., a technology investment bank, according to an article in Entrepreneur.com

Target area number two is “Machine-to-Machine” communications. These new technologies include sensors on home fuel tanks that can signal to oil-delivery companies when they need refilling.

Target area number three is the “Internet of Things”, in other words, Internet-connected devices that collect data and communicate with other physical devices. One example are objects equipped with radio-frequency identification (RFID) chips that can be identified and inventoried by computers. Barcoding is another example. If more objects are equipped with these miniscule tracking devices, it can help with “just-in-time” manufacturing, recovering stolen goods and customer re-ordering of frequently-used items.

Attendees at the luncheon listed target area number four as Software as a Service, hardly a new development, but one that will continue to be a fertile area for venture capital investment.

Are there any key areas of venture capital jobs and investment for 2012 that you think didn’t make the list? Add your comments below.

Permira is a private equity firm from Europe. Since its inception, the firm has managed approximately EUR 20 billion of committed capital and made almost 200 private equity investments. Since 2000, the funds have returned around EUR 14 billion in cash.

Founded in 1985, Permira has more than 120 professionals based in Frankfurt, Guernsey, Hong Kong, London, Luxembourg, Madrid, Menlo Park, Milan, New York, Paris, Stockholm and Tokyo.

Permira’s investors are public pension funds, publicly listed funds, government entities, institutional fund managers, corporate pension funds, insurance companies, charities & foundations and banks. Geographically, the investors are from Europe, North America, Far East and Middle East.

All manner of public commentators and political rivals have been beating up on Mitt Romney for his work at Bain Capital. But most, if not all, show a serious lack of understanding as to how private equity works and the value that private equity professionals bring, says Tom Dougherty in an article for TheRightSphere. He attempts to set the record straight in a lengthy piece worth reviewing.

For example, many critics seem to think that a private equity firm only has to answer to its own management, but nothing could be further from the truth. Management has to provide an adequate return to the firm’s key investors. Failure to do so would quickly doom the firm to attracting more capital.

Critics also fail to understand the dire situation that companies seeking private equity investment find themselves in. Often, the company cannot obtain capital from any other source, is not profitable and could be on the verge of bankruptcy.

Thus, when a PE firm puts money into a sinking company, they do so with the full knowledge that they could lose every dollar invested. Critics don’t acknowledge this risk or the return needed to make it worthwhile.

“The bottom line is the winners have to return such profitability that they offset the certain losses in the much larger percentage of companies plus the overhead required to operate the PE firm on a daily basis,” says Dougherty.

Of course the biggest knock against PE firms is that they’re “job killers” when they take over. But often times it’s the target company’s executive management, the CEO, CFO and other top executives, who get the axe. PE firms then bring in new executives with highly sought-after skills to run the company more efficiently.

“Any business, regardless of size, is only as effective and profitable as the sum of the value of both management and the employees working together to produce goods or services that can be sold into the marketplace for more money than the costs to produce them. The best employee workforce would be at certain risk of loss of their jobs if upper management is ineffective,” says Dougherty.

The full article at TheRightSphere is worth reading and committing to memory as the private equity sector comes under increasing attack in the months leading up to the election. In the meantime, do you think Romney’s Bain Capital experience supports or hinders his ability to be a good president? Add your comments below.

AXA Private Equity is an European private equity company with offices in Paris, London, Frankfurt, New York, Singapore, Milan, Zurich and Vienna. Founded in 1996, the firm manages or advices $ 28 billion of assets.

AXA Private Equity Funds:

Leveraged Buyouts Mid Cap

The company has closed 40 buyout transactions since 1997 in France and Germany. It focuses to invest up to € 250 million per transaction or up to € 500 million with co-investors in companies valued between € 100 million and € 2 billion.

LBO Small Cap

In Western Europe the company focuses on investment in France, Germany and Italy. Invest up to € 40 million per transaction in companies valued at less than € 100 million.

In Eastern Europe, the firm seeks to invest between € 15 to 25 million per transaction in small and midcap companies valued at between € 50 to 300 million.

Innovation and Growth

The company started funding small-medium enterprises since 1998. It invests in IT, Internet and energy sectors between € 2 to 5 million.

Co-Investment

AXA Private Equity regularly team up with other investment funds. The firm can invest between € 20 to 100 million per transaction.

Fund of Funds

The company offer investments in primary funds of funds, secondary funds of funds and early secondary funds of funds.

Mezzanine

AXA Private Equity Mezzanine has more than € 2 billion under management in Western Europe, Eastern Europe, USA and Asia. The firm invests between € 5 to 80 million in direct investments.

Infrastructure

The company seeks to invest up to € 150 million per transaction in transport, environment, energy and public-private partnerships in European countries.

MENA

AXA Private Equity objective is to be active and successful small and mid cap growth capital / leveraged buyouts players in MENA, especially in Saudi Arabia and the United Arab Emirates. The firm seeks to invest between € 20 to 50 million.

What were the big stories for venture capital jobs in 2011? For some, 2011 was a year of recovery, with returns picking up as a result of a few successful IPOs. Some notable tech IPOs included LinkedIn, Groupon, Zynga, ZipCar, RenRen (China’s Facebook), Yandex (Russian search engine), to name a few.

The activity boosted the National Venture Capital Association (NVCA) US VC Index to one-year returns of 26.3% as of Q2 2011. However, even as venture capital recovered as an asset class, investors were not exactly flocking back to venture capital, according to the Huffington Post.

Early in the year, VentureBeat reported how the time is ripe for Russia to emerge as a center for innovation and entrepreneurship. And how venture capital firms are taking notice. A number of VC firms have done deals in Russia, including global firms such as Accel Partners, Bessemer Ventures, and Index Ventures. Venture capitalists have been “cloning” successful start-ups from the West.

We learned that Vietnam is emerging as a venture capital hotspot, even though China and India often grab the bulk of the headlines. Boston’s IDG Ventures and other firms are pouring hundreds of millions of dollars into tech startups in these three countries.

We saw how Marc Andreessen and Ben Horowitz launched their career as venture capitalists, raising nearly a billion dollars in starting Andreessen Horowitz. And how these newly-minted venture capitalists chose an unusual model to guide their firm, that of the Hollywood talent agency. They focus on guiding entrepreneurs much the way talent agents serve their clients, working to find engineers, designers, product managers, and the best marketing talent available for their portfolio companies.

But we also learned that the entire VC industry is nevertheless shrinking. In 2011, 147 venture funds raised $12.2 billion in the first 3 quarters. Ten years ago, at the height of the bubble, over 1100 firms raised $100 billion. And those raising funds had to spend at least 16 months, if not longer, raising those funds, according to Huffington Post.

What do you think where the big venture capital job stories of 2011? Add your comments below.

Bridgepoint is an Europe based private equity investment firm with offices in Frankfurt, Helsinki, Istanbul, Luxembourg, London, Madrid, Milan, Paris, Stockholm and Warsaw.

Bridgepoint investors are public pension funds, corporate pension funds, insurance companies, sovereign entities, fund of funds, endowment foundations, bank and asset manager. Geographically, they are from North America, Europe, UK, Asia and Middle East. To date, Bridgepoint has raised more than EUR 12 billion of committed capital.

Bridgepoint investment strategy focuses on buyouts of the European middle market. The firm’s 6 sector expertise:

• Business Services: professional services & BPO, property & facility services, testing, inspection & certification, equipment rental & asset outsourcing and transport services & infrastructure.
• Consumer: specialist retail, leisure and FMCG.
• Financial Services: wealth & asset management, financial infrastructure, technology & services, insurance and consumer & specialist finance.
• Healthcare: healthcare services, medtech & devices and pharmaceuticals.
• Industrials: aerospace & defense, energy & power, industrial products and speciality chemicals.
• Media & Technology: publishing / information services, exhibitions, intellectual property, research & digital service businesses, enterprise & vertical-specific software, internet-based b2b & b2c companies and financial technology platforms.

Bridgepoint typically invests between EUR 75 million and EUR 400 million in companies with enterprise value between EUR 200 million and EUR 1 billion.

Bridgepoint current investments:

• Business services: A-Katsastus, CTL Logistics, Foncia, Leeds Bradford International Airport, LGC and TüvTurk.
• Consumer: Alain Afflelou, Fat Face, Histoire d’Or and Marc Orian, HobbyCraft, JOA Groupe (formerly Moliflor Loisirs), La Gardenia, Limoni, Pret A Manger, Rodenstock, SEA and Wiggle.
• Financial Services: 1st Credit.
• Healthcare: Aenova, Alliance Medical, Care UK, Clinical Solutions, Diaverum, Médipôle Sud Santé, Terveystalo and Tunstall.
• Industrials: CABB, CFP Flexible Packaging, Permaswage and SPTS.
• Media & technology, Dorna, Groupe Moniteur, Infinitas Learning and John Brown Media Group.

On December 2011 Bridgepoint announced its acquisition of Wiggle for GBP 180 million. Wingle is a leading online cycling and tri-sports retailer.

What were the top stories of 2011 that affected private equity jobs and the industry in general?

AT&T’s $39 billion “Deal of the Year” for T-Mobile that never came to fruition may be one. The on-again, off-again saga came to symbolize the roller-coaster nature of dealmaking in 2011, according to the Wall Street Journal. The year started off strong with several multibillion-dollar deals as companies flush with cash snapped up strategic acquisitions. But then turmoil in the equity markets and uncertainty surrounding the Eurozone debt crisis put a damper on deal activity in the second half of the year.

Private equity deal volume for the first half of 2011 was $113 billion, up from $80 billion in the same time period last year, according to Reuters. That’s a 41 percent increase in deal volume, but it consisted mostly of lower-profile deals in the low- to mid-single digit billion dollar range. What’s more, private equity firms have encountered tougher competition from cash-rich strategic buyers, companies that are operating in the same sector as the prospective target.

2011 also saw private equity firms paying greater attention to Africa as the next hot region for investment. An increasing number of private equity firms are raising capital to invest in sub-Saharan Africa investment strategies and scouting for deal opportunities. Africa has huge potential. Estimates from both the World Bank and the International Monetary Fund hint that sub-Saharan Africa could achieve some of the highest growth rates in the world over the next 5 to 10 years.

This is in sharp contrast with Europe, where bankers have reported a slowdown in the flow of both private equity funds and deal-making as big investors wait to see how things will shake out with the Euro-zone debt crisis. Many private equity deals in Europe and the U.S. were highly leveraged, and current conditions are making it more difficult to raise this level of debt funding, reports Business Day.

And then at the very end of the year comes word that private equity giant, Carlyle Group, bucked the trend by turning in a stronger year of investments and exits, particularly in Europe. Carlyle invested EUR1.5 billion in Europe in 2011 in 12 transactions, compared with five investments made last year and just two in 2009, according to the Wall Street Journal. Carlyle made more deals, in smaller amounts, across three of their funds. This diversified approach serves as a model for the industry at a time when mega-buyouts are difficult because of a lack of debt financing and investing for growth offers the best chance of turning a profit.

What are your top picks for the private equity stories of 2011? Add your comments below.

Clayton, Dubilier & Rice, LLC (CD&R) is a private equity investment firm based in New York and London.

Founded in 1978, CD&R investors include endowments / foundations, families / high net worth individuals, public pensions, corporate pension funds, fund of funds, financial institutions and insurance companies. Geographically, CD&R investors come from North Ameciva, Europe, UK and other regions.

Since it inception, Clayton, Dubilier & Rice has become trusted partner for many corporations including Altria, DuPont, Ford, General Electric, General Motors, Gillette, The Home Depot, IBM, Merck KGaA, Norfolk Southern, PPR, Royal Ahold, Telecom Italia, Veolia, Westinghouse and Xerox.

CD&R focuses its investments in multinational companies. Almost all companies have global supply chain. In general, CD&R portfolio companies generate a third or more of their revenue in other country. The firm investments span from USD 1 billion to USD 15 billion in various business segments including Services and Retail, Construction and Building and Electronics. Clayton, Dubilier & Rice objective in various conditions remain the same: to be an agent of constructive change for the long-term health of the portfolio company.

CD&R typically invests in underperforming companies which are mostly services and distribution related business. Some of CD&R investment portfolio: Atkore International, BCA, Brakes, Culligan, Diversey, EMSC, Exova, HD Supply, Hertz, HGI Holding, Inc., Hussmann, NCI Building Systems, Rexel, Sally Beauty Holdings, ServiceMaster, SPIE, Univar, US Foods and VWR International.

On October 3, 2011 Clayton, Dubilier & Rice, LLC announced its acquisition of 60% ownership stake in Hussmann International, Inc. Hussmann International is refrigerated display merchandising equipment and refrigeration systems manufacturer for the retail food industry.