Manhattan Venture Partners utilizes PitchBook to win lucrative secondary deals

As fund managers seek liquidity and alternative exit paths in a challenging landscape, secondary markets have emerged as an avenue of growth and opportunity. Within a manager’s scope, these transactions include LP interests in portfolio holdings and the purchase and sale of individual direct equity stakes in distinct businesses within LP portfolios. MVP pioneered the institutionalization of this once-undeveloped asset class through its participation in the latter—secondary direct purchases.

Since 2015, PitchBook has assisted MVP in providing liquidity to early investors, entrepreneurs, and executives via secondary direct purchases through buy-side and sell-side transactions. As the PitchBook Platform has evolved and grown to include new features, MVP has achieved significantly more value with only a small incremental increase in its overall costs. Thanks to the number of deals PitchBook helps MVP close, they achieve a return on investment within the first two weeks of their license.

“We’re seen as a leader in the space, and our leveraging of PitchBook early on has been part of the evolution of our success. PitchBook bridges the opacity of secondary market deals to a large extent. And that is critical for us,” said Bradley Fishman, Co-Founder and Managing Partner.

With a repository of institutional and other existing shareholders within venture capital-backed technology companies, PitchBook helps MVP identify selling counterparts with whom they can engage.

On the buy side, PitchBook’s granular data and contact information on registered investment advisor and broker- dealer communities support a substantial portion of their buy-side investment and transaction activity, according to Nicolas Gupta, a partner in the firm.

Identifying shareholders seeking liquidity using private market data

The MVP team recently sourced an off-market seller in a top asset class by discovering exclusively through PitchBook that the seller had made an investment.

Transparently emphasizing that they obtained this information from PitchBook resulted in a more seamless engagement with the seller. While this pattern of success happens several times throughout the year, this deal only took six weeks to finalize.

It would be challenging to compete at the same level without access to the PitchBook database, said Fishman. He noted that having Morningstar public data provides a significant advantage, essentially offering two exceptional data sets in one product.

Efficiently executing deals with accurate models and forecasts

The firm circulates shared lists of aggregated deal flows curated through PitchBook that outline companies it is monitoring along with funding rounds to understand what’s happening across the spectrum of investments.

This process helps the team determine a fair market value for the security and understand the investor’s financial standing. During a market downturn, a significant amount of time is spent evaluating not just the business itself but also the security held and its pricing. Understanding these intricacies is essential for successful deal-making, as it involves considerations beyond simply purchasing shares. Factors such as the investor’s history, duration of participation, and overall financial performance must be considered to negotiate effectively.

“Data points are critical. They differentiate professionals from tourists in our market in terms of how you enter a conversation and how you end in negotiation. That’s part of where we’ve been successful because all of that data sits within PitchBook,” explained Fishman.

• Investor repository
  Access comprehensive investor profiles, including information on past deals, current partnerships, contact information, and more.
• Market maps
  Chart emerging markets that matter most to you powered by analyst expertise and best-in-class private market data.
• Research Library
  Discover timely, institutional-grade private market research that delivers unmatched expertise and analysis.
• Salesforce integration
  Streamline workflows and optimize client engagement by syncing PitchBook data with your Salesforce CRM.
• Screener tools
  Leverage our powerful advanced search functionalities using specific criteria to find the data you need.
  

Raising capital faster by approaching the right co-investors

MVP’s investment analysis team supports business development reps and partners by building out what it calls an “opportunity screener” for new deals that bolster sourcing efforts. With a vast investment universe consisting of over 1,000 companies, maintaining a comprehensive database detailing factors such as the number of employees, HQ office location, and key investors is crucial.

The ability to cross-reference and cut across data points enables reps to develop a scoring system, enhancing their ability to efficiently screen and analyze potential investment opportunities. Ultimately, this approach allows MVP to delve into in-depth due diligence and identify promising prospects at a faster pace.

“Being able to source and perform due diligence in an efficient manner is invaluable, as it allows us to explore the most interesting opportunities faster” said Senior Associate Paul Morris.

PitchBook’s Direct Data API seamlessly integrates with MVP’s Salesforce to streamline prospect sourcing. It enables the team to create lists, qualify contacts, and extract relevant and descriptive data directly from PitchBook. This process saves several hours each week and is an integral part of the organization’s workflow.