E282: Why LPs are Investing into Independent Sponsors

The podcast explores the landscape of independent sponsors in private equity, focusing on their increasing prevalence and attractiveness as investment opportunities. It highlights TIFF's approach to investing in this space, emphasizing the importance of a double layer of diligence that prioritizes the sponsor's capabilities and long-term potential before evaluating individual deals. The discussion covers the benefits of the independent sponsor model, such as greater flexibility, aligned economics, and the ability to be selective with investments, while also addressing potential drawbacks like the need for infrastructure and team building as the sponsor grows. The podcast also touches on fee structures, GP commitments, and strategies for sponsors without pedigree backgrounds to establish themselves.