Private equity trends are almost always undulating, adjusting, and acclimating with the times. Investors will look for opportunities with the best potential return value while outweighing predicted risks. Like any other industry, trends and external circumstances can coalesce to create monumental changes in the way industries present.
Today, readers are going to dive into the world of private equity trends as they prepare for trades in the year 2023. Gary McGaghey utilised more than 15 years of industry experience in senior management and as CEO of Williams Lea Tag to inform his thoughts and opinions.
Rising Importance of Private Equity
Gary McGaghey of Williams Lea Tag sat down for an interview where he explored his mindset, processing, and thoughts on the future role of private equity. McGaghey stated, “In 2023, things will pick up again. What you find with these financial markets is it never cools for long. There’s too much money going around and not enough places to put it.”
In the words of Gary McGaghey, today’s private equity encapsulates several different investment strategies that feature a throughline of bringing funds in from private investors. Despite this, venture capitalists will remain an important figurehead in providing businesses with the means to develop their early days of operations. This kind of mindset lends itself well to the tech field, where companies are always trying to bring about ideas and products that reshape the way we live our lives.
Despite his easy-minded approach to the private equity world, McGaghey understands that the industry is at a serious intersection and is now more dog-eat-dog than ever before. McGaghey stated of the industry, “I knew it was ruthless, but you just got to be in it to realise it is dog-eat-dog. It is a seriously ruthless industry.”
Gary McGaghey on Trends to Watch In 2023
The rising tide of the impact caused by the COVID-19 pandemic continues to reverberate throughout the Private Equity (PE) industry. Gary said of potential opportunities due to the pandemic, “In the world of PE, they look for opportunities; their environment doesn’t change whether opportunities are going to come about or not.”
In addition to thoughts on the private equity industry, McGaghey understands that Machine Learning will be at the forefront of the industry in the future. Machine Learning and alternative data sourcing have been part of the AI studies that have endeavoured to solve new problems that can help human operators fuel growth through buy-out opportunities. Machine learning and artificial intelligence, according to McGaghey, will work together to develop next-level problem-solving capabilities.
Remote Work and Virtualisation
COVID-19 forced much of the world to change its operational parameters. Offices were shut down, and commutes were cut down to the minimum as the role of the remote worker continued to grow. Moreover, meetings, deals, and decisions were increasingly being played out across digitalised mediums.
In the wake of the COVID-19 pandemic, work-from-home and virtualisation activities have remained at an all-time high. McGaghey is of the mindset that PE will continue to embrace virtualisation and remote work as a part of their daily operations.
The benefits of remote work and virtualisation are simple as they seek to break down the barriers of workflows while eradicating the need for geographical closeness. As a result, McGaghey argues that efficiency can be improved upon at PE firms that undertake the process.
In the words of McGaghey, “Although PE wants you to report every day, there’s a perception that you have completely free rein while you do and you don’t because there’s no one to rely on. It’s all about you.”
McGaghey advocates for companies to take a long look at how they approach their main challenges, as virtualisation lacks some weight that a physical meeting can present. Gary McGaghey suggests that companies will have to take a case-by-case approach to decide the proper yet delicate balance between virtual work and in-person operations.
Environmental and Social Governance
While logistics comprise the vast majority of McGaghey’s approach to private equity, there is an underscored understanding of environmental and social governance in investing. McGaghey advocates for the continued investment in societal structures as they are often the cause of better-informed decisions with better control for investors in the future.
Understandably, advocating for and adhering to sustainable and environmental social governance is a task that requires studying and statistics. However, McGaghey suggests that ESG investing requires more than an understanding of analytics and potential outcomes; it must have a nuanced approach throughout the entire process.
About Gary McGaghey
Gary McGaghey has been an industry leader in senior management for more than 15 years. Building his brand out of South Africa, McGaghey has since become an international leader in several industries. First beginning his career in the realm of retail food and household manufacturing products, McGaghey would find his way to Robertsons Foods, Robertsons Homecare, and Baker Street Snacks for more than a decade of his time.
Gary McGaghey now operates with the team at Williams Lea Tag as the Group CFO. With almost two years of leadership experience at the company, McGaghey has been considered a driving force in the more than $1.3 billion valuation of the company.