Governance & succession · Original source
Anna Hogan; Jessica Gerrard; Elisa Di Gregorio
Disadvantage in schooling is often constructed as a crisis in need of fixing. Global policy reforms tend to emphasise that solutions for disadvantage often lie beyond the capacity of the state, necessitating private/philanthropic intervention. This paper seeks to contribute to this line of analysis by investigating the rise of philanthropy in Australian public schooling. Our analysis focuses on the intermediary organisation, Schools Plus, which works to connect donors to disadvantaged public schools. Through qualitative content analysis and stakeholder interviews we demonstrate how philanthropy has come to be seen as a solution to the complex problem of disadvantage, or more specifically in this case, the perceived inadequacies of public education provision. The consequence of this, we suggest, is the changing of responsibility for addressing disadvantage from government to individual schools that have been able to establish an entrepreneurial culture to market their disadvantage.
Governance & succession · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Education philanthropy can create new burdens when access to funds depends on a school’s ability to tell an appealing story. This companion proposes a grant-design review focused on need, application effort, dignity, public responsibility and the opportunity to decline publicity.
Governance & succession · Original source
Evelyn Stommel; Nicole Gottschalck; Andreas Hack; Kimberly A. Eddleston; Franz Kellermanns; Nils Kraiczy
Drawing from prospect theory, we use an experimental study design to explore how and why reference points of managers of family and nonfamily firms differ. We contribute to research on the role of economic theories for family businesses by elaborating on decision-making mechanisms in the context of family firms. Furthermore, we investigate whether family and nonfamily managers within family firms vary in their investment decisions. Our study demonstrates the importance of price volatility as a determinant of reference points and shows how the same type of information can lead to different reference points based on whether the manager is from a family or nonfamily firm.
Governance & succession · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
The same price history can produce different perceptions of gain, loss and acceptable action. This companion proposes a pre-decision reference-point record that distinguishes acquisition cost, current value, required liquidity and the family’s purpose before investment alternatives are debated.
Governance & succession · Original source
Keratiloe Sishoma Mogotsi; Tyler Dale Hauger
“Participatory grantmaking” (PGM)—the practice of ceding decision-making power about grants to communities that are affected by the outcomes of the grants—is gaining traction in many philanthropic spaces. While there is emerging literature on PGM primarily in the Global North, few academic contributions explore how PGM plays out in the Global South. This article therefore advances the state of knowledge related to philanthropy and grantmaking, by analytically exploring PGM specifically in the African continent. Through in-depth qualitative interviews with 19 grantmakers within sub-Saharan Africa, the article identifies common forms of PGM in the region, its impact on various forms of power—particularly visible power—and the barriers encountered, including shrinking civil society space, resource scarcity, and back-donor demands. The article argues that PGM in sub-Saharan Africa cannot be seen as isolated in a silo of philanthropy, but that its contributions to addressing power imbalances must be integrated in broader long-term development sectors that are often dominated by the Global North. It also underscores that power, in its various forms, will always be present in PGM. Practitioners must continuously adapt and refine these models to address the uneven power dynamics in grantmaking that they aim to change.
Governance & succession · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Inviting community members to a meeting does not establish that they control a funding decision. This companion proposes a participatory-grantmaking charter that specifies authority, representation, donor constraints, compensation, challenge routes and evidence of whose priorities shape the outcome.
Governance & succession · Original source
Muhammad Umar Boodoo; Irene Henriques; Bryan W. Husted
With the growing call for private sector actors to address global challenges, it is necessary to first assess whether regions with the greatest needs are accessing corporate philanthropy. In this paper, we ask whether corporate philanthropy is reaching those with the greatest health-care needs. Drawing on economic geography and corporate homophily, we argue that corporate philanthropy tends to exacerbate health inequality as grants are destined for counties with fewer health problems. We test and find support for this hypothesis using data on health grants made by US corporate foundations and county-level health data. Our results that corporate health grants are less likely to go to counties which have a lower proportion of medical service providers and insured citizens suggest that corporate foundations are unwittingly complicit in worsening the resource gap between small, poor, rural counties and large, wealthy, urban counties. From an ethical perspective, we provide some guidance as to how this may be corrected.
Governance & succession · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
A grant portfolio can favor well-connected places while overlooking communities with greater unmet need. This companion proposes a geographic review that separates recipient location from service reach, makes the donor’s selection filters visible and tests whether neglected communities can access the foundation.
Private capital & investment governance · Original source
Moritz Wehking; Tim Alexander Herberger
Private equity investments are highly sensitive to economic shocks due to their assets' high leverage and illiquidity. Allocations to PE have significantly increased over the past decade; research on portfolio selections during economic shocks however remains scarce. We bridge this gap by analyzing sector-level re-allocations during three global economic shocks (the DotCom-bust, the Global Financial Crisis, and COVID-19). We do so by comparing the share of sectoral capital six months before each shock with capital allocations made during the shocks, using a dataset of more than 53,000 buy-side transactions. Specific sectors showed increased transactions from PE investors across all shocks, indicating positive perception from investors in times of uncertainty. Our findings entail: Limited Partners need to critically assess industry-orientated investments of General Partners and challenge over-allocation in perceived “safe harbor” industries, especially when General Partners have no specialization in these industries. When the General Partners are industry-specialized, however, Limited Partners can unlock significant return potential when they agree to an extended investment period. For General Partners with expertise in sagging industries, shocks offer investment opportunities as competition shies away and valuations decrease. Companies in sagging industries seeking external capital should target sources other than PE or accept increased return expectations.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
A manager's move toward a resilient sector can reflect expertise, opportunity, or imitation. This companion translates Wehking and Herberger's transaction-level research on private-equity reallocations during three economic shocks into a review of investment mandate, sector experience, liquidity commitments, and decision accountability. The proposed process tests whether the family office understands a change in exposure before treating that change as protection.
Private capital & investment governance · Original source
Patrick Röhm; Andreas Köhn; Andreas Kuckertz; Hermann S. Dehnen
Corporate venture capital (CVC) investors are regularly painted with the same brush, a fact underscored by the often observed belief in the extant literature that corporate venture capitalists (CVCs) form a homogeneous group. In contrast to this simplifying perspective, this paper categorizes CVCs into subgroups by examining their levels of strategic and financial investment motivation using computer-aided text analysis and cluster analysis. To validate the resulting clusters, this paper studies the impact of CVC type on startup valuation from an intra - group perspective by applying hierarchical linear modeling, thus illustrating which particular investment motivation might be preferable to others in the context of negotiating valuations. An empirical analysis of 52 CVC mission statements and 147 startup valuations between January 2009 and January 2016 revealed that first, CVCs with a strategic investment motivation assign lower startup valuations than CVCs with an analytic motivation that have moderate levels of the two scrutinized dimensions, suggesting that entrepreneurs trade off these CVCs’ value-adding contributions against a valuation discount; second, CVCs with an unfocused investment motivation pay significantly higher purchase prices, thus supporting the hypothesis that they have a so-called liability of vacillation; and third, the valuations of CVCs with a financial investment motive are not significantly different from those of their analytic peers. In sum, our results add to the knowledge of the continuum of corporate investors’ investment motivation by illustrating how startup valuations differ across CVC types.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
A corporate investor may seek financial return, strategic access, or both. Röhm and colleagues show that corporate venture investors' stated motivations are heterogeneous and associated with startup valuations. This companion proposes a disciplined ledger for family offices co-investing beside corporate investors: identify motives, translate promised resources into verifiable obligations, compare security terms, and rehearse conflicts before commitment.
Private capital & investment governance · Original source
Benjamin Hammer; Nils Janssen; Bernhard Schwetzler
Using a dataset of 1149 global private equity transactions, we find that cross-border buyouts are associated with significantly higher valuation multiples than domestic ones. We attribute this finding to informational disadvantages of foreign acquirers. Consistent with this idea, we find that the spread in valuation multiples narrows when the target operates in a country with high accounting standards, when it was publicly listed prior to the buyout, and when information production is facilitated due to large firm size. Further results suggest that local partnering in a syndicate serves as an effective remedy to avoid adverse pricing effects. The spread in valuation multiples is also less pronounced for large buyout funds, presumably because they draw on sufficient organizational resources to cope with cross-border-related transaction costs.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Cross-border access can widen a family's opportunity set while weakening its ability to evaluate price and operating risk. Hammer and colleagues associate foreign buyouts with higher valuation multiples and examine conditions that narrow the difference. This companion converts the evidence into a transaction-specific information-gap register, local-partner challenge process, and staged approval protocol without treating geographic expansion as a universal advantage.
Private capital & investment governance · Original source
Prosper Lamothe-Fernández; Eduardo García-Argüelles; Sergio Manuel Fernández-Miguélez; Omar Hassani-Zerrouk
Private equity (PE) represents the acquisition of stakes in non-listed companies, often long-term, with the objective of improving the performance and value of the company to obtain significant benefits at time of disinvestment. PE has gained particular importance in the global financial system for delivering superior risk-adjusted returns. Knowing the PE return drivers has been of great interest among researchers and academics, and some studies have developed statistical models to determine PE return drivers. Still, the explanatory capacity of these models has certain limitations related to their precision levels and exclusive focus on groups of countries located in Europe and the EE.UU. Therefore, in the current literature, new models of analysis of the PE return drivers are demanded to provide a better fit in worldwide scenarios. This study contributes to the accuracy of the models that identify the PE return drivers using computational methods and a sample of 1606 PE funds with a geographical focus on the world ’ s five regions. The results have provided a unique set of PE return drivers with a precision level above 86%. The conclusions obtained present important theoretical and practical implications, expanding knowledge about PE and financial forecasting from a global perspective.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Computational models can help investigate private-equity return patterns, but classification performance is not an investment return. Drawing on Lamothe-Fernández and colleagues' analysis of 1,606 funds, this companion proposes a model-risk dossier for family offices evaluating forecasts, manager-selection tools, or AI-supported allocation research. It emphasizes target definitions, information timing, benchmark comparisons, distributional limits, and human approval.
Private capital & investment governance · Original source
Luis Alberiko Gil-Alana; Francisco Puertolas-Montanes
This paper deals with the analysis of the statistical properties of the profitability yielded by Private Equity from a fractionally integrated viewpoint. Using quarterly data from 1981q2 to 2021q3, the results support the hypothesis of stationarity and mean reversion in all cases; however, we observe differences in the degree of persistence across regions, Europe being the closest to short memory while the US shows the highest degree of long range dependence and thus the longer lasting effects of shocks. Some policy recommendations of the results obtained are included at the end of the manuscript.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
A smooth private-equity return series may contain economic persistence, valuation effects, or both. Gil-Alana and Puertolas-Montanes examine the statistical memory of regional pooled-IRR series. This companion proposes a family-office reporting process that separates model-based mean reversion from realizable liquidity, tests the age and basis of valuations, and links prolonged shocks to commitments and distributions.
Private capital & investment governance · Original source
Roland Füss; Stefan Morkoetter; Maria Oliveira
We investigate the role of alumni ties in university endowments’ decision to invest into private equity funds. Based on a sample of 1,590 commitments made by 189 U.S. endowments into 613 funds during the period of 1995 to 2017, we show that endowments are more likely to invest into funds that are managed by the alumni of their own alma mater. This finding is more pronounced for less prestigious and less private equity experienced university endowments. Thus, our results are not only dominated by institutions with a larger proportion of active alumni in the private equity industry. Furthermore, we observe that alumni ties are not associated with better performance compared to other endowment investments where such a tie does not exist.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Relationships can open access to funds without proving their superiority. Füss, Morkoetter, and Oliveira examine alumni ties in university-endowment commitments to private equity and find that connected managers are more likely to receive commitments, without corresponding evidence of superior performance. This companion proposes a relationship-aware diligence process for family offices that preserves useful networks while making selection criteria, conflicts, and comparative evidence inspectable.
Private capital & investment governance · Original source
Alexandra Moritz; Walter Diegel; Joern Block; Christian Fisch
We assess whether and how VC investors’ education and experience influence their screening decisions of potential investee candidates. Empirically, we perform an experimental choice-based-conjoint (CBC) analysis with 564 individual VC investors. Our results highlight that the level and field of education, as well as the decision maker’s investment and entrepreneurial experience, moderate the relative importance of different screening criteria. More specifically, we find that international scalability seems to become more important for decision makers with higher education and those with entrepreneurial experience. Whereas decision makers with a background in natural science focus on the value-added of the product or service, engineers seem to value a break even profitability and focus less on the management team. Investment experience, on the other hand, leads to a stronger focus on the management team. Our study contributes to the literature investigating the influence of human capital characteristics of the decision maker in venture financing. Practical implications exist for entrepreneurial ventures seeking financing and for risk capital investors making investments in such ventures.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Investment expertise can direct attention as well as improve it. Moritz and colleagues examine how education and experience relate to venture-screening preferences. This companion proposes a calibration exercise in which family-office reviewers independently assess comparable cases, explain disagreements, and examine missing evidence before turning screening preferences into investment judgments. It does not rank educational backgrounds or claim that any profile produces superior returns.
Private capital & investment governance · Original source
Christian Garmann Johnsen; Johannes Lenhard
Despite the growing prominence of impact investing in both research and practice, the definition of social and environmental impact remains contested. Rather than resolving the elusiveness of impact, we examine how impact venture capitalists (IVCs) leverage this ambiguity in their everyday practices. Drawing on Michel de Certeau’s philosophy of everyday life, we identify three tactical ways in which IVCs navigate this ambiguity. First, IVCs use ambiguity to move sideways into new markets, distinguishing themselves from traditional investors. Second, they tactically employ ambiguity to attract limited partner (LP) capital earmarked for impact investments. Finally, they leverage ambiguity to forge connections with founders of high-growth ventures, thereby gaining a competitive edge in deal-making. We discuss the ethical dimension of these tactics, highlighting how the normative question of what constitutes social and environmental change arises from the practical use of the ambiguous term impact. In doing so, we identify an ethical tension: while the flexibility of the term impact fosters new ways of thinking about social and environmental change, it also risks being used for purely financial gain. We conclude by reflecting on the implications of this ethical tension for both the practice and research of impact investing.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Ambiguity can enable innovation while making impact claims difficult to evaluate. Johnsen and Lenhard's ethnographic research examines how impact venture capitalists use flexible definitions to access markets, founders, and limited-partner capital. This companion proposes a change register that allows a family office to revise its impact thesis transparently while preserving beneficiary definitions, evidence requirements, decision rights, and the ability to challenge unsupported claims.
Private capital & investment governance · Original source
Tongyu Meng; Jamie Newth; Christine Woods
This article explores impact investing within the renewable energy sector. Drawing on ethical decision making and sensemaking, this article contributes to an enhanced understanding of the complex ethical sensemaking process of impact investors when facing plausible situations in a world of contested truths. Addressing the ethical tensions faced by impact investors with mixed motives, this study investigates the way decision makers use context-specific reasons to make sense of and shape the renewable energy investment (REI) process. This represents an initial attempt to understand ethical sensemaking in impact investing made within the renewable energy (RE) sector using a multi-stakeholder approach. Our findings show that prosocial, personal, reputational, and economic motives are the main drivers of REI, with prosocial and personal motives being value-based, and reputational and economic motives being evidence-based. We find three different modes of ethical sensemaking (pragmatic, retrospective, and forecasting), allowing for the construction of the four motives noted above. These motives are based on the context-specific reasons of impact investing decision makers in the RE sector. This article contributes to the academic discourse on ethical sensemaking with some key processes involved in ethical decision making, and a better understanding of the underlying motivations of impact investing in the RE sector.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Impact-investment decisions combine financial evidence, personal commitments, reputational concerns, and aspirations for social benefit. Meng, Newth, and Woods examine these motives in the Chinese renewable-energy sector through ethical sensemaking. This companion proposes a structured family-office deliberation that asks what is feasible now, how earlier experience shapes judgment, and who may bear future consequences. It treats motives as matters for examination, not substitutes for diligence.
Private capital & investment governance · Original source
Verena Hossnofsky; Patrick-Peter Herold; Franziska Schlichte; Sebastian Junge
Drawing on signaling theory, this study investigates whether the environmental orientation of new ventures serves as an important signal related to funding outcomes. Analyzing a dataset of 2003 funding rounds completed in the U.S. during 2022, our findings reveal that the environmental orientation of a new venture positively influences pre-IPO funding outcomes. Furthermore, this effect is positively moderated by the prominence of lead venture capital investors. Our post hoc analysis offers a valuable temporal perspective and suggests that our findings generalize across both early-stage and late-stage funding rounds, but not seed funding. This study contributes to the literature on financial resource acquisition and signaling theory, and also offers valuable implications for practitioners, helping them navigate the competitive funding environment more effectively.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
Environmental orientation can influence funding without establishing environmental performance. Hossnofsky and colleagues study green signals and lead-investor prominence in United States venture funding rounds. This companion proposes a diligence bridge for family offices: record the exact signal, distinguish intention from measured change, inspect the lead investor's contribution, and set proportionate evidence milestones before repeating impact claims.
Private capital & investment governance · Original source
Kirsten Andersen; Rebecca Tekula
Based on an abductive analytic study, we examine financial and social value incorporation in the multi-valued market of impact investing. This paper draws on interviews with investment professionals in 54 charitable foundations, intermediary and field building organizations in the impact investing market, to compare market objectives with practice, and to determine whether social and financial values are incorporated, thus producing ‘returns’ of both types through market exchange. We find unincorporated valuation is apparent at both the market level and for several types of investors in contrast with the incorporated or even integrated valuations of other investors. This demonstrates that rather than incorporating logics in a binary or hybrid way, valuation in the moral market of impact investing occurs in a multiplicity of ways and on different levels of the market, depending on a variety of factors including adherence to traditional financial market standards and market design and maintenance.
Private capital & investment governance · Solutions companion
Family Office Private Wealth Journal · Editorial research desk
A foundation can support social purpose while still allowing financial conventions to dominate investment decisions. Andersen and Tekula examine how charitable foundations and related organizations incorporate financial and social values. This companion proposes a charter that distinguishes capital purposes, defines permitted trade-offs, records how transaction design serves those purposes, and evaluates decisions against the objectives actually authorized.