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PIP's primary investment objective is to maximise capital growth
by investing in private equity funds and, occasionally, directly in private companies.
The spread of performance in private equity is much wider than in other asset classes and the
selection of managers has a significant influence on investment performance. As a specialist
fund-of-funds manager monitoring and researching the global private equity market, Pantheon,
PIP's Manager, is well positioned to identify fund managers who have the skills and strategies
to deliver superior performance within their particular market segments.
PIP's strategy is to invest with leading private equity managers whilst reducing investment
risk through diversification of the underlying portfolio by geography, manager, maturity,
investment stage and sector.
This strategy is implemented through PIP's primary and secondary investment programmes.
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Primary Programme
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The primary programme invests in private equity funds when they are first formed. Pantheon aims
to secure access to superior managers whose funds are frequently oversubscribed and to identify
high quality managers often overlooked by the market. Investments are made on a pro rata basis
alongside Pantheon's regional fund of funds.
The primary programme enables PIP to invest strategically in specific areas of the market, put
money to work steadily over time and gain access to the very best funds.
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Secondary Programme
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The secondary programme purchases existing investments in private equity funds. Typically these
investments are acquired between 3 and 6 years after a fund's inception. PIP benefits because
the fees and expenses in the first few years have been paid and distributions from the fund will
be returned over a shorter time period.
PIP benefits from an arrangement to co-invest in a predetermined ratio alongside Pantheon's global secondary
fund programme, benefiting from access to larger secondary opportunities that it would not have
had the capacity to complete alone. The secondary programme enables PIP to acquire attractively
priced secondary interests as and when these become available.
In addition, PIP may occasionally acquire direct holdings in unquoted companies, either where a
vendor is seeking to sell a combined portfolio of funds and direct holdings or where there is a
private equity manager, well known to Pantheon, investing on
substantially the same terms.
This dual approach of investment in the primary and secondary market is more consistent and
efficient than investing solely through either the primary or secondary market.
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