YouSaid · the spoken record

Hugh MacArthur

lines on the record: 86
first: 2025-06-23
most recent: 2025-06-23
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“See are pretty much the same as they were five or seven years ago. Yeah, that might be true, but this thing called Co-Invest, 15 years ago, Coinvest was a hobby. Some people asked for it. Some people didn't. Some people didn't care. Now Coinvestment is about 30 to 40 cents of every dollar that's invested in the industry. Depending upon the GP, there are some GPs whose dollar of fees per dollar of AUM have gone down by 50% over the last decade because of Co-invest. Then there's some folks that write very large checks, which they know are in short supply. They don't want to pay the number on the book. And they're not. You've got an industry that has got high prices, which means the margin for error is low in generating returns. You've got increasing costs. You've got pressure on fees. That implies to me, you better be ready to succeed and have a strategy going forward for the next five or ten years because these forces aren't going away. The industry is maturing. The competition is intensifying for the people, the deal.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“LPs are real, and the competition for that money is extremely intense. So there's a big push into private wealth because folks like you and me are not necessarily investing in the industry the way that institutions are, and GPs have woken up to that. They're saying, that's where the exposure is, that's where trillions of dollars are. I need to be better at that. Well, that costs money. I'm going to have to have more people on my payroll chasing small checks than I ever had chasing very large checks from large institutors. It's just a fact. Also, the cost of getting the subsector expertise that we're talking about is going up. I've got to be sharper at what I'm doing, my investment theses, my subsectors, how I'm doing it in a more competitive world. My costs for value creation is going up. I've got to continue to develop and maintain an ecosystem for adding value. I don't know any GPs that are saying my costs are going down. So prices are high. GP costs are going up. Also, fees per dollar of AUM have been going down. Folks will say, well, no, the numbers on the books that I.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Anomalous zero interest rates and then the periodic upheavals have massed is the continued maturation of the industry over time. Now we're pulling our heads up and looking at a world where we've got very high prices because things are expensive and there are lots of dollars chasing the same investment opportunities. We've got costs that are increasing for GPs because you need to find new sources of capital and compete harder for the capital that's out there with traditional institutions. Everybody is recognized now that half of the world's wealth is with individuals and those individuals have almost no exposure to private asset classes and private equity would like to go and get that, especially in an environment where institutional sources of capital are pretty tight right now. All of that upheaval has caused a great difficulty in the industry being able to exit the investments that they have. So the liquidity issues for traditional”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“People kind of got used to it as normal because it lasted for over a decade, but we had a wonderful capital cycle of people investing and interest rates being low and GDP growth being positive and compounding and multiples just going up and up and up. So I could buy something and four years later sell it for a higher multiple. And the world is great. And raising money was pretty good off the back of that. And the industry made great returns. In the last five years, we've seen the opposite of that. We've seen a whole bunch of 12 to 18 month periods of chaos, if you will, starting with COVID in 2020, then moving on to unprecedented inflation for the industry. That led to unprecedented rapid rises in interest rates for the industry. And now we're dealing with tariffs and policy that are roiling the markets over time. There's been every year, practically since 2020, in industry freak out of, oh my gosh, let's look at the portfolio again. Here's something else we haven't seen. What do we do? How do we do it? And what that period of”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think we are at an inflection point in the private equity industry, but a macro level, we see continued penetration of private assets. One of my friends said it very well with the public markets. You've got 90% of the world's money chasing 10% of the world's investment opportunities. The private markets are the opposite. We have 10% of the money chasing 90% of the world's investment opportunities. There's going to be a rebalancing of that over time, which means that the private markets are going to be supersized. Against that backdrop, if you look at something like private equity, we do have some temporal things going on that are setting the stage for an inflection point that will really separate those that thrive in the future and those that are going to struggle or not be here in the future. The best context I can set, Ted, is that we went through this period of about a decade where we had a zero central bank interest rate structure in the US and Europe for most of that time. That was the anomaly.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, step one was let's see if we can correct some of the factual errors and say this is what's going on in the industry. And then also in the annual report, talk about some of the major trends that we see or something that's hot. It could have been a geography. It could have been a subsector. It could have been a style of investing, something that's going on that we think people should know about because we see enough of it. I'd love”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“The actual facts of what's happening in the private equity industry, that's a very hard thing to do because there's no one source of information that will tell you everything when it takes years and years to really understand whether investments are paying out or not. You can spin things in many different ways. And it is hard to get to the truth. I used to say tongue-in-cheek. There are lies, damned lies, statistics, and then there are facts about the private equity industry right over here on the edge.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“That report, I think we've done it 16 years now or something like that, came about, and I remember this very, very clearly because I was very irritated, which was part of why it came about. We used to read in the media that one of our competitors would potentially partner with some academic institutions somewhere and they would come out with some article that would be printed about private equity and what was going on in the world. And most of the time, I thought it was wrong. We kept seeing it episodically again and again. And it just became like this little annoyance that there were things out there that were being put out into the public domain that were just incorrect about the private equity industry. And finally, a few of us said, we do more of this work than anyone. We know what's going on better than anyone. We need to correct this issue. And it wasn't, let's go do an article and put it in the Wall Street Journal or Financial Times because that's forgotten in two days. So we wanted to create something that was more lasting. And we thought, what if we do an annual report? What if we try and get...”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, you are sitting on top of so many relationships on really every side of the industry. I know you try to bring it together in an annual report and then a mid-year update. How did that report first come about?”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Set up to be able to respond when it actually comes in the door and be able to do it in a way that makes sense to the GP. There are a lot of different things we do for the LP world. It starts with strategy, but definitely goes to operations and organizational work as well.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“LP side of the coin, so how should I think about positions in different GPs? And how should I think about co-investment and how should I think about strategic partnerships with GPs if I want to be doing that? What's the universe of things that are out there and what does that imply I need to be doing as an LP to be a good partner for my GPs? There's two sides of the coin. Everybody thinks about the GPs go and they get money from the LPs. So they need to come and be good and give the LPs things that they want. Well, that's absolutely true. On the flip side, if the LP is asking for co-investment and the GP is providing it and saying, I've just got this deal, here's co-investment for you. I need an answer in a week. And you're an LP and you say, my investment committee meets once a month. It's next three weeks. That's not good partnership back to the GPU. So we need to try to work with the LPs to say, this is how this is going to work from the other side of the coin. On the GP side, and therefore, if you'd like to have Co-invest, you need to be.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“LP work is actually very similar to GP work. They need an overall strategy. Where do you want to be in five years? What's your ambition? Typically, there's obviously a level of financial return that's involved in that. There's an asset mix, a desire that's involved in that. There are organizational issues that are involved in that. Some of these organizations are quite different. LPs are quite different from one another. The question would be typically asked, they can see many and oftentimes their cash flows out into the future in terms of the cash that will be coming in, the checks that they need to write if they need to write checks. And they'll say, well, we're a 200 billion AUM organization today in seven years will be 500 billion. How do we organize for that? What does that mean? What do our departments look like? What does our decision-making structure look like? What do we need to do to manage risk better? There are organizational pieces of work that we do. There are operational pieces of work that we do. How do we think about one asset class versus another or within an asset class? What does investing excellence look like from the”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“The private equity world we have now worked with. And the interesting way that we're organized that I think clients appreciate is that we use the same group of people to work for both GPs and LPs. So clients know that the team that's working for them can see both sides of the coin. They understand what's important to a certain set of LPs and they understand what's important to GPs. We're able to integrate those two sides of the coin to get a win-win. You can't have a win-lose transaction and the LPGP relationship. It's a relationship that's supposed to last over time and stand the test of time in an industry where it takes a decade or two to know what the heck's going on and how things are going in terms of results and how we're really dealing with one another when you think of it as a relationship behooves everyone to understand the motivations, the needs, and the strategy of the other parties so that you're able to actually try and fit what you're doing into that context.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“And we spend about three months prepping for this bakeoff in the industry against all of our competitors because we really wanted to win the work. We stepped up on the day we were fortunate to carry the day and win the work. And that began a 15-year wonderful relationship with a large sovereign wealth fund that was really the anchor client in us building out the LP side of our business. We were fortunate that not many people start with the largest, most sophisticated investor in the world. So it wasn't like we started with a very small LP and moved up. We started with in some ways the biggest challenge possible first. And then that allowed us that experience over time to work with a variety of other investors in other spaces. The LP world is very diverse. We started out at the sovereign wealth fund level, but that's gone all the way down to family offices and pension funds and insurance companies and banks, endowments, all the different types of institutions that invest in.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Really interesting how that came about. We had never really done that much work with limited partners, episodic work. I got a call one day out of the blue. Somebody knew somebody at Bain who said, do you guys know anything about investing in private equity? And somehow the call got routed through to me. And I wound up talking to someone from a large sovereign wealth fund in the Middle East. We had never worked for the sovereign wealth fund before and thought, great, this is an opportunity to potentially work for a very sophisticated large investor on that side of the coin that we've never really mined before. I thought to myself, we have to play to win because some of our competitors had for entire practice areas that were working for institutional investors and sources of capital, and we had yet to really enter into that game. The first thing I did was I called up all of the senior people I could think of from around the world. I called in people from Singapore, from London, from New York. We descended on the Middle East in the GCC en masse.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Jump into the value creation post close, we have a hypothesis of where we're going. It's these three things we, of course, have to introduce in partnership with management. What do you think of these three things versus all the growth agenda that's on your table? Let's debate that. Let's agree with the important things are. That's always a really valuable interaction because we always learn about something. Until you get the keys to the company, quote unquote, you really don't know everything. As much as we try to know everything we possibly can from the outside in, you just can't. We always learn things. Sometimes things you don't want to know. You want to know them, but they're not positive. And sometimes things that are actually really, really exciting that you just couldn't have gotten to from the outside in diligence, that gets put on the agenda saying, you know what? It's not three things that are going to make this happen. It's four.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Win over time. So one of them might be for a consumer product I need to figure out how to sell at a profit online because I'm not online right now. That involves a whole number of large things to do. But if I don't do that and online is growing as a share of the business, I'm not going to be able to make my revenue numbers. And I need to do that at a cost level that's actually going to mean my EBITDA is going up the way I want to. It may mean that I've got a supply chain in the wrong place and I need to reorganize it in order to put it in the right place for my cost and my resiliency. That has a lot of steps in it, but I need to do that in order to succeed. And it may mean that I need to gain market share with my customers and my diligence tells me that I can gain market share of my customers if I do the following three or four things well. So it might be three big initiatives like that that we would lay out in diligence and say, if we do these three things, we'll make a really attractive return on this investment. But that's going to take a lot of planning. That's the kind of head start that when we then”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“First thing we try to do on the value creation side is make sure that the beginning of that is at the diligence stage. You're underwriting something. I've always believed that you need to know the three or four things that you really want to have happen to create the value at the outset of the deal. 30 years ago, you didn't really need to do that. When you're paying five or six times EBDA for an asset, you could put some leverage on it. And as long as the asset did pretty well, you could cash out and make a lot of money. Now that the average multiple is 12, not five or six, that margin for error is gone. We're kind of starting from scratch and saying, we need to figure out how to make these numbers because we're probably going to have to make a competitive multiple bid off those numbers to win the asset. And if nobody understands how we're going to get there, we need to in the diligence begin to flesh out what are the opportunities for this business that are really grounded in data and what are the three or four big things we think we need to do in order to”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“A pipeline of opportunity so that when things do come for sale, if they do come for sale, I'm ready to move quickly because that speed to insight is my advantage. It's a very competitive world. Deals are going to be intermediated. There are going to be other buyers out there. The quicker I'm confident that I want an asset. I'm able to pay the right price for it and close, the more likely I am to win that asset. In that kind of a world, the proaction building a sourcing capability is really important. And that's also one area where we're seeing technology playing an increasing role. We're seeing algorithms and we're seeing AI swimming through data lakes to try and find and proactively identify companies that have the characteristics that investors want to buy. I'm racking and stacking these things and then being able to proactively reach out and maybe meet management, maybe go to industry conferences and find these sorts of people that are running these businesses so that I really have my own robust pipeline. I wouldn't say the industry is fully moved in that direction.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Therefore, the knowledge development and the requirements to bid and underwrite something, the bar is going up over time. And if you're the one that knows the least at the table, that's always the worst place to be, whether you win or whether you lose. Investors are finding that as they focus in on ever more narrow subsectors and different types of investment theses within those subsectors that they're looking at a narrower universe of deals that they want to do. The aperture is closing. So the notion of getting a thousand random things in the door and picking from that in that type of world is nonsensical. So what folks are doing now is they're building their own sourcing pipeline. If I'm investing in software and there are 50 different subsectors in software and I invest in eight of them, I want to know what properties that are in my check size range in those eight sectors might come to market over the course of the next three to four years and understand a lot about them before they come to market. I'm now proactively building.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Sourcing piece is one of the more interesting evolutionary areas of buyouts in particular, the old school way of sourcing was we have 500 or 1,000 confidential information memorandums or SIMs come in the door every single year. And then a firm would typically sort through them, figure out which ones are most interested in and through pipeline management, they would winnow down that to the two or three or four deals that they were going to really do during the course of the year. So it's what comes in the door sort through the thousand. We want to do these three. We do these three. The world is specialized and even hyper specialized to the extent that the notion of doing that has become very, very antiquated because people are now organizing firms, funds, and talent around things like subsector expertise, not just sector expertise. We do healthcare, but we do healthcare IT. And within healthcare IT, it's these areas of software and not those areas of software. So the world has become very, very specialized.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“You have the diligence part. And if you broke apart how private equity deals get done, there's sourcing and then value creation at the other side. How have you worked with clients on the sourcing piece?”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“If you're talking about deals that get done, deals that are thought of, that don't get done, investment ideas that are looked at and then discarded after a few weeks. It's a big number. There are some clients that hire us when they know they're in the final stages of doing a deal and they really need to decide. There are some folks that have a retainer team of Bain consultants, 365 days a year, and every investment idea that comes in the door, they want us to look at, whether it's for an hour or a day or a week or several weeks. When you add that all up, it's probably four to five thousand different investment opportunities every single year that we look at. And that ranges from give me your best shot at it in an hour with an expert to let's do the whole four weeks of due diligence.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Technology stage 4.0, which of course is Gen AI, and AI being able to create entirely new data sets and ways of looking in the world that were impossible. One example of that that's a new tool. We are at Bain the single largest firm that does expert interviews in different industries. So we call up experts when we're doing a due diligence and we interview them. We ask them about competitors. We ask them where the industry is headed. We ask them what's going to happen, et cetera. Well, we do more of those interviews than any firm in the world. What we thought was why don't we transcribe all of those interviews so we have every single word, compile them all over time, and then ask Gen AI to summarize.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Amount more. I call that diligence wave 2.0 of technology disruption. Then we had wave 3.0 of technology disruption, which were specialized data and tools that became available to us like credit card payment information. And would you like to know what everybody spent then on these credit cards on certain fast foods and where they're going to? And I can do things now without even doing customer surveys to tell you where share shifts are going and where people are spending their money and how much and what customer loyalty looks like in different businesses. We came into the world of specialized tools and specialized data sets. You can do automated scrapes of LinkedIn and Glassdoor to figure out how employees are feeling about companies and how one competitor sales force is organized compared to another competitor. That was wave 3.0, which is new different types of information that we never had access to before that we can look at and further evaluate a business for acquisition. Now we're entering diligence.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“For talent increasing, you need strategy, just like in any other maturing industry, you better have a way that you're competing that's different and sustainable compared to your competitors or you're going to find life difficult. So we do a lot of firm strategy, organizational and operational consulting now for investors themselves, for GPs and LPs. That didn't exist before 2010 post-COVID, it's accelerating even more, especially with the current situation and volatility in the markets, specifically talking about the due diligence product. It's developed in waves. We had this initial outside in view, which was extremely analog. I mean, we're talking about 1995 here. The internet's barely in anybody's consciousness. We're doing lots of phone calls. We're looking up things in books and printed reports, trying to do some things in a few weeks where today it would seem absurd to think that you were actually doing that. And then, of course, the internet became popularized and we have all of this information at our fingertips. And we thought, oh my gosh, we can do it tremendously.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“We've layered on a lot of different things because the world has changed and accelerated so much. Back in the day when we started this business, the average transaction size was $100 million total enterprise value. And so we thought no company was ever going to be big enough to hire Bain once they were a portfolio company because they were so small. Now the average transaction size is a billion dollars. So that's a whole new product line. We also learned after coming out of the GFC that many, many GPs figured out because LPs became skeptical of performance. They were worried about what private assets were going to do and what private equity was going to do in particular that they needed some strategies themselves. The strategy in the accumulated history of the private equity industry had generally been make your next deal a good one. And that actually was fine as a strategy where the cottage industry, where there was enough of everything for everyone to succeed if you were doing well, that worked fine. In an era of constrained capital, the competition for deals increasing, competition.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was a good thing the product resonated. I remember walking up and down Park Avenue, which is where all the GPs are located, and visiting GP after GP in the conversation went the same, my colleagues and I would be sitting there and they'd say, well, we know why we need an accountant to do a deal, and we know why we need a lawyer to do a deal. But why the heck do we need a consultant to do a deal? Why would we ever hire you? We'd have to try to explain, well, would you like to know these kinds of external contextual facts about businesses? And fortunately, the reaction was they were blown away. They were like, you could tell us things like that about a business. Like, yeah, we actually can. That was really the genesis of the practice. And the interesting thing for us is that I do believe that very often it's better to be lucky than good. We were at the very beginning of this great wave of private asset growth that has continued over the course of the past 30 years and with the beneficiaries of that by being the first ones in on the ground floor with a lot of GPs and working with them.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Consulting, you tend to look at a company from the inside, they hire you, you get all of their data, you figure out where their opportunities and their problems are, and you try to solve them. Well, in the private equity world, it's different. You're looking at a target, you don't have all of their data, you're looking very much at external data to try and understand how fast does the industry really growing and what's pricing going to do? And do customers like you better than the competitors or not? How is technology and regulatory issues changing? What are competitors doing? All kinds of things that you need to do some creative digging to find the information and the client wants the answer in three to four weeks, not three to four months, because they have to make an investment decision. We needed some specialized approaches that were very analogous to everything that we did for corporations to do that. And that became the first practice area at Bain& Company. And there were, of course, one or two firms out there in private equity that asked us to do this because they were aware of what Bain Capital did and they were the pioneers. But once we decided we wanted to make this a thing, that we actually thought.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“One of our now clients that came to us and said, We actually do pretty well at this private equity game ourselves, but we noticed that bank capital seems to be doing really well. And the biggest difference we see between them and us is that they have 100% of their employment staff come from Banking Company. Could you do for us on an outsourced basis what they seem to be insourcing, which is hiring lots of Bain people? And we thought, huh, that's kind of an interesting question. Maybe we could find an app for that to put it in Common Parlance now. figured out on a due diligence cycle, which was our first solution for the private equity and private asset business, how do we do things in a few weeks that we'd actually normally spend a few months doing for a corporation. It was a very different movement for us. And it required different staffing, different pools of people, different ways of working to figure out how to quickly come to answers and really take a specialized outside in approach to evaluating an asset because corporate could.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's interesting back in those days, this goes back to 1992, there were no practice areas in consulting firms at all. So if you went and hired Bane to do something, you could literally get anybody from Bain on the case. And regardless of their background. So to give you an example, my first few cases at Bain, I worked in food consumer products. I worked in corporate charge cards. I worked for a utility. And I worked in the life insurance business. That would be absurd and impossible today to actually do. But back then it was normal. There was no internet. There was no real requirement for industry expertise. And it was, let's just get a bunch of smart people and we'll solve your problem. Against that backdrop, a few of us began to notice that Bane and Company had also formed a private equity firm in the 1980s called Bain Capital that had been doing pretty well. And I'd love to take credit that we were geniuses and somehow figured out that there was a consulting opportunity in private equity, but it was actually...”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“A couple of years working in MA research in New York and in London. And then I decided that I really didn't know much about what I was doing at all, and I better go back to business school to try and figure out if I could learn more about business. I went to the MIT Sloan School to get MBA and met some folks A consulting firm called Bain Company there. And”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Before Won't go too far back, except to say that I'm originally from Massachusetts. Went to undergraduate school at Dartmouth College. Then thought I was going to go off and do great things on Wall Street Except I found that nobody really wanted to hire me as a history major. I also Wasn't particularly a great interviewee. That I thought that I needed to. To people how smart I was, and that I could really solve all their problems, and I probably came across as someone who was. Ignorant of things I was interviewing for and a little bit too arrogant about how smart I was and how I could help people. Or 10 straight job interview rejections gets you humility pretty quick. So I did some introspection there. Figured out that I was going about this the wrong way. Did finally get a job.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“I've written about what's really going on with endowment secondary sales and how institutions may use interval funds in the future. If you're interested in keeping up with my thoughts from the many conversations I have with investment leaders, sign up for our premium content at capitalallocators.com slash premium. It costs far less than a cup of coffee a day, and I'm highly confident in a Michael Milken highly confident letter kind of way that you'll return a large multiple of your investment. Thanks so much for encouraging me to share more of my investment thoughts and for supporting the show through our premium membership. Please enjoy my conversation with Hugh MacAr Thanks so much for joining me.”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“GPs and LPs need to pursue to come out on the right side of a changing industry. We get going, every now and then a fan of the show asks me to share more of my investment views. I get it. I've been around the block a few times and often have something interesting on my mind. But I prefer not to insert myself in the podcast every week. There's a difference between an interview and a conversation that often gets blurred on many podcasts. Capital Allocators is an interview show, so instead of talking so much, you can barely stand hear my voice, I occasionally take a turn on the other side of the mic and share it that way. I also record my blogs on the podcast, aptly named, what Ted's thinking. I'm doing more of that with shorter pieces this year. Lastly, I've come up with a new way to share more with our premium members. We've added amusing section to our weekly emails where I'll share brief investment ideas with a high signal-to-noise ratio. As examples,”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source
“Guest on today's show is Hugh MacArthur, the chairman of Bat& Company's Global Private Equity Practice, which he helped found more than 30 years ago. Hughes Consulting Team works on around 5,000 investment opportunities every year and comprises the largest practice area at Bank. He also hosts the Dry Powder Podcast, my favorite in the private equity space. Our conversation covers Bain's work in private equity across due diligence, sourcing, value-added support, and strategy for both GP and LP organizations. We then discuss findings from Bain's latest global private equity report, including data on the slowdown and deal activity, liquidity bottleneck, private wealth inflows, carve-outs, AI, and competitive position. We close with Hughes perspective on the winners and losers of the next era and the strategies”
2025-06-23 · Capital Allocators · Hugh MacArthur – Private Equity's Challenges and Opportunities (EP.453) · IDENTIFIED FROM THE TRANSCRIPT · source