Scored / audited entities are all GPs within one given fund team. It is the same team that was committed to LPs during the fundraising process.
GP-Score does not rate individual of full PE firms.
Scores are valid for one year. Certifications are valid for three years.
Ratings also come with a full audit report.
No. It is for GPs only to determine whether / when / to whom they want to communicate their scores or certifications.
Audit fees are based on the number of portfolio cos. At the time of audit and how complex / diversified the portfolio is.
Audits typically range between £ 45 k and £ 300 k.
Certifications are significantly more inexpensive.
Zero tech, zero data.
Ratings are established based on an examination of facts and actual value creation situations, period.
Every situation is unique.
No. Some GPs excel at value creation while having no OP. Others do only so well when even though they hired numerous GPs.
Not necessarily. Getting rated early makes it easier to improve value creation (and ratings) throughout the fund’s life.
That said, there needs to be at least one portfolio co in the fund for a minimum period of 6 months for a rating to be performed.
That is for the GPs team to decide. Our recommendation : be transparent with LPs and implement a solid plan to improve value capabilities so ratings improve in time.
ince GP-Score charges GPs, how can we be sure GP-Score is independent?
Audits are payable in advance.
GP-Score’s reputation is based on our ability to independently issue fair ratings.
By all means not.
We analyze facts and concrete situations that cannot be summarized by numbers.
However, our framework is revised on a regular basis – hence the Methodology Committee.
We repeatedly found that fund size does not necessarily correlate with value creation performance.
There are a number of solid ESG rating tools available.
GP-Score is about rating value creation.
Although ESG can be a factor in long term value creation it is not part of our framework.
1. Past performances offer no guarantee re the future.
2. Value creation has become more critical in these days of higher capital costs and strong valuations.
3. LPs now understand they need to pay attention to inputs, not just outputs.
4. In the past some GPs achieved great financial performance with mediocre value creation. This will become much harder going forward.
The core of value creation lies in the details of concrete actions in deep layers of portfolio cos. Information reported to LPs via middle management and top management only captures a fraction of what happens on the ground.
GP-Score teams goes in the depth of operations in order to check how facts match reports. Nothing can replace that.
