Private Equity: Count Vanguard in as a Competitor in the Space

February 6, 2020 | Investments, News, Private Equity

Vanguard, the world’s largest investment firm, has entered the private equity business. The firm will provide PE in a suite of new funds and target pensions, endowments, and other institutions. The company forged a partnership with HarbourVest to offer “qualified” investors with access to new funds. HarbourVest manages roughly $68 billion in assets.

“We are entering the private-equity market the Vanguard way — partnering with a world-class adviser to provide a high-quality offer,” Vanguard CEO Tim Buckley said in the statement.

This is a significant shift for the company best known for its mutual funds and low-cost ETFs. Known for its lower costs, it will be interesting to see how it charges customers, and whether it will put pressure on fees for its competitors.

Vanguard Goes to Private Equity

Meanwhile, it’s worth noting that this isn’t Vanguard’s first venture into the private equity space. In 2001, the firm attempted to launch PE funds but fell short of capital raising goals. At the time, it worked with Hamilton Lane Advisors to establish a fund of private equity funds. At the time, it said it would charge just 0.85% (with Hamilton Lane taking more than half of the fees). However, it later revealed that fees would also go to funds insider portfolio and to fund advisers in the form of profit fees. It had planned to raise more than $100 million. However, it never raised this money.

This time will be different. The company has grown, alternatives are also hot, and PE appears to be the inevitable turning point for a firm with $6.2 trillion in assets under management. 

“Private equity will complement our leading index and actively managed funds,” Buckley said. “While this strategy will be initially available to institutional advised clients, we aim to expand access to investors in additional channels over time.”

Recent: Private Equity: Steve Pagliuca Rebuts Elizabeth Warren and Bernie Sanders

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.

Alt Insights

January 29, 2020

Venture Capital: The Kobe in “Bryant Stibel & Co”

Venture Capital: The Kobe in “Bryant Stibel & Co”

Latest Alternative Investment News
ESG: Graham Clapp Says ESG-Focus is Creating a New Bubble
February 27, 2020     ESG and Sustainability, News

RWC Partners fund manager Graham Clapp warned that sustainable investing trends are poised to form a possible bubble in the markets. He compared it to the tech boom of the 1990s….
Hedge Fund: Whitney Tilson Pumps Berkshire Hathaway as Top Retirement Stock
February 27, 2020     Hedge Funds, News

Former hedge fund manager Whitney Tilson has called Berkshire Hathaway (NYSE: BRK.A) the to retirement stock. Tilson, who now writes for Empire Financial Research, issued a note this week praising…
Liquid Alternatives: Invesco Launches New Sterling Corporate Bond ETF With ESG

Invesco, the fund manager with $1.23 trillion in assets under management as of December 31, 2019, has launched in Europe a new, first-of-its-kind, sterling-denominated, corporate bond ETF with an ESG…
Digital Assets: The SIX Swiss Exchange Buys A Stake in Crypto Trading Platform Omniex
February 27, 2020     Digital Assets, News

SIX Swiss Exchange announced it had struck a partnership agreement last week with San Francisco-based Omniex. The financial terms of the agreement, which also includes the acquisition of a stake…

Scroll to Top