Corporate Private Equity
Our Corporate Private Equity business focuses on investing in Europe and North America through a series of funds focused on the lower mid-market, mid-market and upper mid-market.
We have a team of more than 100 investment professionals based in London, New York, Paris, and San Francisco managing €13 billion of capital.
Our investment strategy
The middle-market is a traditional stronghold of Rothschild & Co.
We believe this holds the greatest pool of businesses that meet our risk appetite and yet have significant headroom for further growth.
We are deep sector specialists looking to back the leading companies of today and tomorrow in a size agnostic way through a series of funds focused on the Lower Middle-Market, Middle-Market and Upper Middle-Market.
Lower Middle-Market
In the lower middle-market, we seek to deploy equity tickets of €30 to €100 million per investment in fast-growing companies.
Middle-Market
In the middle-market, we seek to deploy equity tickets of €100 to €300 million per investment. In addition, we have the ability to commit substantially more than €300 million to a single transaction upfront, thanks to extensive co-investment agreements with our investors.
Upper Middle-Market
In the upper middle-market, we seek to deploy equity tickets of more than €400 million per investment. In addition, we have the ability to commit substantially more than €400 million to a single transaction upfront, thanks to extensive co-investment agreements with our investors.
Sector focus
Our targeted business characteristics are typically found in asset-light service businesses or product businesses which have a strong service component. We particularly focus on and have deep experience and perspectives in the following sectors:
- Data and Software
- Healthcare
- Technology-Enabled Business Services
Within these, we are focused on specific sub-sectors that best meet our investment criteria.
Geographic scope
We seek to support businesses across Western Europe and North America. We primarily focus on either 'domestic franchises' - high-quality businesses with significant under-penetration in their local jurisdictions - or 'export champions' - businesses with strong local market positions but with offerings that can be internationalised.
We have found that both types of businesses can benefit from the combination of our local, 'on the ground' networks and global reach.
Flexible mandate
We invest alongside partners, including entrepreneurs, family owners, management, financial sponsors and corporates. We are flexible about the situations that we look to invest in, which include growth capital, replacement capital and traditional buyouts – in all cases, we seek to be an active partner. We use financial leverage where appropriate and always with utmost care and conservatism.
Investment criteria
We look for high-quality companies led by talented management teams who care deeply about the businesses they run. Specifically, we seek businesses which:
- Have an entrenched and highly defensible market position
- Have business models with high visibility of organic unit volume growth and strong unit economics
- Have a track record of generating attractive returns on invested capital and free cash flow across multiple economic cycles
- Benefit from positive structural market trends, providing high visibility on expected volume growth
- Present multiple untapped levers for operational improvement or corporate development
The composite picture is one of companies with recurring, predictable and visible revenues and cash flows which in turn gives us the confidence to invest for their long-term growth.
Our investment approach
We leverage our reach across Europe and North America to pick attractive sub-sector themes that we want to back and work from there to identify specific investment opportunities. As a result, we have well-developed points of view on what we like to invest in and have commonly followed the businesses we invest in for long periods of time prior to the completion of a transaction.
This approach, combined with our domain expertise, allows us to move quickly, be decisive in our responses and agile in our ability to commit capital.
One of the most distinctive aspects of our business model is our dense network of industry executives – both active and retired – in each of our core sub-sectors. Our investment teams work hand-in-hand with these operators for every deal in order to develop a proprietary, differentiated and strategic point of view on embedded upsides invisible to industry outsiders.
Owners and managers of our portfolio companies often find in our operators a tremendous resource to develop commercial opportunities and test new business ideas.
We seek to support strong, motivated management teams with whom we establish a relationship of trust. As an engaged shareholder, we are looking to support and guide great companies to become even better and achieve their full strategic potential. Our input is tailored to the needs of companies and we do not shy away from providing strategic or operational support when needed.
Our Portfolio Operations Group combines top-tier consulting pedigree with experience as operating executives to bring a strategic and operational skill-set to bear in company-specific situations. This manifests in a strong focus on building the systems and processes for data-driven decision making, organisational design and executive recruitment, commercial performance improvement, product strategy and delivery, M&A integration and systems upgrades.
Delivering long-term value has always been at the heart of the Five Arrows strategy. We are committed to address sustainability in our investment process through our ESG programme and have launched philanthropic, volunteering and pro bono initiatives. We aim to promote the principles of responsible investing within our investments and encourage our partners to consider ESG criteria in their activities. This includes our commitment to contribute to a more environmentally sustainable economy by minimising our carbon footprint and promoting responsible consumption and resource management.
Our team
