Best books on private equity
“A reader lives a thousand lives before he dies, said Jojen. The man who never reads lives only one.”
George R.R. Martin, A Dance with Dragons
While not comparing private equity books to A Dance with Dragons, here are my chosen ones on private equity.
Introduction to the PE industry
Mastering Private Equity: Transformation via Venture Capital, Minority Investments and Buyouts
by Claudia Zeisberger (Author), Michael Prahl (Author), Bowen White (Author)
This 2017 book, written by an INSEAD professor Claudia Zeisberger is my favourite primer to the private equity industry, more suitable for new and aspiring practitioners than business owners. It covers the entire investment process, from sourcing and evaluating opportunities to executing deals and managing portfolio companies.
Private Equity in Action: Case Studies from Developed and Emerging Markets
by Claudia Zeisberger (Author), Michael Prahl (Author), Bowen White (Author)
A fantastic accompanying book to the one above, Private Equity in Action showcases real-life private equity case studies written by the INSEAD faculty. The case studies covers the full spectrum of private equity lifecycle, from fundraising to investing to carve outs and secondary transactions. My favourite chapter was about Mekong Capital’s investment in a chain of restaurants in Vietnam.
The Masters of Private Equity and Venture Capital: Management Lessons from the Pioneers of Private Investing
by Robert Finkel (Author), David Greising (Author)
A slightly older book, written in 2009 by 2 Harvard Business School professors covers the back story of many private equity and venture capital pioneers.
The book covers the history of the PE and VC industries, starting with the founding of the first VC firms in the 1960s and tracing their evolution up to the present day.
The authors also provide insights from their interviews with some of the industry’s most successful investors, including David Bonderman (TPG), Tom Perkins (Kleiner Perkins), and Michael Moritz (Sequoia).
These interviews provide readers with valuable lessons on how to succeed in the world of private equity and venture capital, including how to identify promising investment opportunities, build successful teams, and manage risk effectively.
Barbarians at the Gate: The Fall of RJR Nabisco
by Bryan Burrough (Author), John Helyar (Author)
While the fight for RJR Nabisco happened years back (written in 1989), this is a riveting read and was probably what attracted me to the industry years ago.
The book is a detailed account of the leveraged buyout (LBO) of the tobacco and food company. The bidding war between Kohlberg Kravis Roberts (KKR) and other potential buyers, including F. Ross Johnson, the CEO of RJR Nabisco and Forstmann Little, ultimately drove the price of the company to $25 billion.
The title of the book comes from a statement by Forstmann, in which he called Kravis’ money “phoney junk bond crap” and declares him and his cousin as “real people with real money,” also stating that to stop raiders like Kravis: “We need to push the barbarians back from the city gates.”
The Private Equity Playbook: Management’s Guide to Working with Private Equity
by Adam Coffey (Author)
Of all the books recommended here, this would be the most helpful book for business owners and senior management in a business.
Written from the point of view of a CEO working with private equity firms for management teams looking to join PE-backed companies. What does it take for management to have the chance to make life-changing wealth?
Coffey offers guidance on how to evaluate private equity firms and choose the right one for your company. He also provides insights into how private equity firms approach due diligence and how management teams can prepare for this process.
The Second Bounce Of The Ball: Turning Risk Into Opportunity
by Sir Ronald Cohen (Author)
A riveting memoir written by the founder of Apax Partners, Sir Ronald Cohen, a very successful British PE/VC firm. The Second Bounce of the Ball shares many lessons in entrepreneurship.
“Everyone can see the first bounce of the ball. It is the second bounce that is uncertain. Cohen argues that the entrepreneur’s challenge is to take advantage of that uncertainty: for it is only in situations of uncertainty that substantial gain can be made.”
Money Games: The Inside Story of How American Dealmakers Saved Korea’s Most Iconic Bank
by Weijian Shan (Author)
Unlike other books on this list, Money Games focuses on private equity in Asia and specifically in South Korea. It tells the captivating story of the acquisition of Korea’s largest bank, Korea First Bank by Newbridge (now called TPG Asia) in the late 90s which lasted a full 15 months.
The author, Weijian Shan, was one of the key players in the acquisition and provides a firsthand account of the negotiations and decision-making processes that took place. He also delves into the cultural differences between American and Korean business practices and how they impacted the acquisition.
This book provides an insight into the world of private equity and a case study of the successful recipe for a buyout deal.
The Dealmaker: Lessons from a Life in Private Equity
by Guy Hands (Author)
The Dealmaker is a fantastic book written by Guy Hands, the founder of Terra Firma.
Hands begins by describing his outsider background and how he got into private equity. He then discusses the key principles of successful dealmaking, such as the importance of thorough research and due diligence, understanding the value of a business, and having a clear strategy for creating value.
The book also covers the importance of building relationships and the role of trust in the private equity industry. Hands provides examples of successful deals he has been involved in, including the acquisition of music company EMI, and shares the lessons he learned from both successful and unsuccessful deals.
The Private Equity Toolkit: A Step-by-Step Guide to Getting Deals Done from Sourcing to Exit
by Tamara Sakovska (Author)
The Private Equity Toolkit is my best read in 2023 yet.
The way young private equity analysts learn is via the ‘apprentice’ model, crunching numbers on behalf of the partners and accompanying them in deal negotiations. Their mastery of the profession may be hindered if the ‘master’ is not well-rounded, i.e., the partner may be very good at deal sourcing but not very good at structuring term sheets and mitigating downside risks. This is a scenario more common than you would think.
This book provides a practical ‘how to’ guide on each step of the PE cycle, from developing an edge in sourcing to evaluating and executing deals, written by seasoned PE practitioner Tamara. A book I wish I had when I started my career in the industry years ago. 🙂
The Last Tycoons: The Secret History of Lazard Frères & Co.
by William D. Cohan (Author)
A fascinating and revealing account of one of the most secretive investment banks in history. The author, William Cohan, is a former Wall Street banker, and he does a great job of exposing the inner workings, the personalities, and the conflicts of Lazard Frères & Co.
As a private equity practitioner, I found this book insightful and relevant. It shows how Lazard shaped the corporate landscape of America and the world, with its legendary dealmakers such as Felix Rohatyn and Bruce Wasserstein.
I highly recommend this book to anyone who is interested in the art of dealmaking and the psychology of leadership. It’s not just a book about Lazard, it’s a book about human nature, ambition, and innovation.
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