Michael Lindauer, Allianz Capital Partners

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Michael Lindauer is co-CIO of Allianz Capital Partners. He joined the institution in 2003 and has been an influential decision-maker with regards to backing private equity managers, and a respected and informed LP. He is based in Europe and has responsibility for ACP’s global private equity investment programme.

He talks to Ross Butler of Linear B Group about Allianz’s investment business and market-view, approach to GP selection and terms, and much more. This is a must-watch conversation for any private equity manager who wishes to understand how an experienced and thoughtful institutional investor approaches fund investment opportunities.

In this Fund Shack private equity podcast, Michael discusses various aspects of private equity, including its growth potential compared to public equity markets and the importance of maintaining good governance models. He mentions the potential for private equity to gain market share from public equity over time, given its strong governance. Michael also emphasizes the importance of evaluating managers based on their track record, portfolio, and cultural fit. He highlights the significance of understanding a manager’s decision-making process, team dynamics, and succession planning in the due diligence process.

Michael discusses the growth of private equity firms and how their operational processes have evolved with their size. He touches upon the competition in the industry, emphasizing that competition remains relative regardless of the firm’s size. Terms and fee structures in private equity funds are discussed, with Michael noting that while some changes have occurred at the margins, the basic model of 2-and-20 fees remains largely intact.

The conversation delves into the topic of holding periods in private equity investments and the challenges of extending them. Michael suggests that longer holds can be beneficial if they result in higher returns. He also touches on the evolving role of technology and healthcare in the private equity landscape, emphasizing the need for adaptability as market dynamics change.

Regarding his own organization’s ambitions, Michael discusses their growth plan, particularly in expanding their program to external clients. He notes that their ambition is to grow the second leg with external clients while maintaining a diversified client base, which includes pension funds, family offices, and insurance companies.

Michael concludes the podcast by stressing the importance of open communication between limited partners and general partners in private equity. He believes that maintaining transparency and building personal relationships is crucial to a successful partnership.