The Curious comparison of Private Equity and Bagger Vance

Apropos the comment on value addition in one of my earlier posts is well taken. Agree to the fact that as long as the promoter treats you as a partner and there is a high element of trust and transparency in the relationship, there are not too many reasons why the marriage (PE infusion is is a marriage) should fail.

I would like to believe that a PE fund is similar to the support crew for a marathon runner or a caddie for a golfer (could not help comparing it with the movie "The Legend of Bagger Vance" I saw the other day). The comparison does sound a little corny, but here goes nevertheless...



Not too dissimilar to the relationship between Bagger Vance (Will Smith) and Junuh(Matt Damon), the relationship is not permanent, but not fleeting either. Ultimately, it is the golfer (read promoter) who calls the shots. The Caddie's core job is to carry the golf kit (and in the case of capitalism, bags of cash ! - argh, that was quite tacky, wasn't it ?!).

The caddie can only help exorcise demons in the minds and bring in perspectives that otherwise might elude someone who is focused on his job. So what does a caddie bring in ?

Peripheral vision: What are your other competitors doing ? Is there a better way to do what we are currently doing ?

Order and discipline: What is the best way to position a ball before hitting ? How would you want to proceed on taking into considering the terrain, weather and the competition ? Who keeps track of the spoken and the unspoken ranging from body language to quality of each shot to hits and misses ?
Confidante and sounding board: Temperance of of the highs and lows of essential are necessary for consistency of performance. Often, a person who is emotionally attached to his sport might find it difficult to distance himself from it. It is the caddie, who serves as the shoulder for the golfer to lean on, during times -good and bad.

Suffice to say the golfer knows his game better than the caddie (otherwise why would the caddie be a caddie, after all ?). We must remember that a caddie is not indispensable but often can lead to that marginal extra that can prove decisive in the long run.

What say readers ?

Varadha

(Varadha.r1@gmail.com)
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