Continuation Vehicles from the LP Seat – Scott Ramsower (EP.523)
Scott Ramsower, Head of Private Equity Funds at the Teacher Retirement System of Texas and ILPA Board Chair, joins Ted Seides to examine why institutional LPs have grown increasingly skeptical of continuation vehicles. Ramsower details a 10-point framework explaining LP pushback on GP-led secondaries, breaks down the math behind hidden fees and synthetic DPI, and assesses the broader market challenges surrounding zombie funds, retail private equity vehicles, and manager underwriting.
- Texas TRS strips out synthetic DPI generated by continuation vehicles and NAV loans to evaluate GP performance strictly on real cash distributions from third-party buyers. Read →
- The institutional assumption that an unrealized company held at cost automatically yields a 2x return at exit has collapsed under higher capital costs and slower distributions. Read →
- According to Coller data cited by Ramsower, 54% of institutional limited partners expect the count of zombie funds in their portfolios to rise over the next two years, up from 28% two years ago. Read →
- Continuation vehicles place general partners on both sides of the trade, turning managers into agents for both the selling fund and the incoming buyers. Read →
- Scott Ramsower, Head of Private Equity Funds at the Teacher Retirement System of Texas and ILPA Board Chair, warns that retail private equity represents the right investment strategy inside the wrong legal vehicle. Read →