1) Capital markets has got to be one of the most interesting spots at a private equity firm. How does the rising rate environment affect the way you’re structuring leveraged buyouts?

We focus on investments in companies that have fundamental tailwinds with downside protection so have been able to find attractive financing solutions over the past year between the syndicated and private credit markets. The current rate environment re-emphasizes the importance of strong cash flows and interest coverage ratios. With higher rates there’s also renewed interest in the ability to PIK interest to achieve the same leverage levels we’ve seen over the last few years.

2) What is the new buyout deal flow like these days?

Year-to-date has been light following relatively challenging financing conditions in the fourth quarter of 2022. That being said, it feels like there’s starting to be a pick-up in the number of early-stage processes so I’m cautiously optimistic for the back half of the year.

3) How is the economic backdrop impacting your portfolio companies with upcoming capital needs, such as maturities or acquisitions?

The slowdown in new LBO activity has given the whole market a chance to focus on refinancings and A&Es for existing borrowers. We’ve been very opportunistic in extending tenor and raising capital when the market has had open windows and will continue to prepare early and watch the market for periods of support. We also regularly evaluate alternatives such as taking a syndicated issuer to the private credit market or vice versa.

4) From where you sit, what are the pros and cons of syndicated debt versus private credit?

We’ve found support from both markets at various points over the past year and I would expect to continue to access both. The syndicated market provides a more diverse lender base and when operating properly prices risk very efficiently. The private credit market can grow well alongside roll-up strategies and can dig deeper on more complex credit stories in some cases. Depending on the transaction the markets trade off on being the more attractive source of financing, but from my perspective, both work best when they are each fully functional.

5) What kind of opportunities are you seeing as a result of market volatility?

The current market volatility creates opportunities for those willing to be creative and prepare early to be well positioned to act quickly.

6) What in your opinion are the biggest risks in the current market conditions?

The market has continued to be very event driven, with strong reactions to both large and small data releases and events. This makes timing to market more challenging, especially for transactions that need to be in market for longer.

7) What have you learned from the Silicon Valley Bank collapse in terms of cash management?

The SVB collapse has increased our focus on where portfolio companies have accounts and in whose name various types of short-term investments are held. We specifically look to have accounts at G-SIBs and D-SIBs at a portfolio company level to make sure that we have flexibility in case we need it.

8) Before joining BC Partners, you were in JP Morgan’s leveraged finance group. What’s it like moving from an investment bank to a private equity firm?

Overall a lot of the same fundamentals apply to both roles, especially since a significant part of the capital markets role focuses on accessing the leveraged finance markets. But the capital markets seat also encompasses a number of other markets from equity to ABLs to hedging and in my case was broadened even further from moving from a seat that focused on North America to also learning the European markets. There’s also more ongoing information of the portfolio company’s needs and performance so you’re able to constantly be thinking about what to do next with less guesswork than there sometimes is from the banking side.

9) We hear that you’re a fan of the performing arts. Do you have a favorite show you’ve seen recently? And if so, why?

I’ve loved two, very different, shows recently: Camelot at Lincoln Center Theater is based on a book by Aaron Sorkin and was an incredibly well done take on a classic. I also loved & Juliet, another new take on a classic story. It was a joy to watch and I don’t think I’ve smiled so much in ages. The music is by Swedish songwriter and producer Max Martin so it incorporated a lot of favorite hits from Britney Spears to Kesha to Backstreet Boys.