As part of our annual year-end coverage, WSJ Pro asks members of the private-equity community to share their thoughts on the past year and reflect on challenges and opportunities they see in 2021
The following has been excerpted:
Each year, our reporters and editors ask members of the general-partner and limited-partner communities to reflect on the year that has just passed and the one that lies ahead. This past year has been perhaps one of the most challenging in a decade. But as the professionals we spoke to indicate, those challenges have also presented valuable lessons and opportunities as they look to the future.
Andrew Nikou, Founder and Chief Executive, OpenGate Capital
What was the most challenging aspect of the pandemic in your professional life over the past year?
Andrew Nikou, founder and chief executive, OpenGate Capital
PHOTO: NEIL FAVILA
The greatest challenge is the uncertainty of how long this will last, and the uncertainty of knowing if we are doing enough. We have a team of 45 professionals in the U.S. and Europe, and a portfolio of companies with 10,000 employees across the globe. The most important mission was immediately ensuring the health and safety of all our employees in Asia, Europe and North America. Fortunately, we took actions quickly, developing a Covid-19 operational playbook, implementing our crisis plans and utilizing our OGx technology-focused platform, which enabled the CEOs of our portfolio companies to enhance their operations as soon as the pandemic started. We were well-prepared and, in some ways, ahead of the curve. Thankfully, our actions minimized infection rates, and we have not had a fatality to date.
What are you most looking forward to in 2021?
Without question, I am looking forward to bringing our team together physically. While we already have great technology that connects our offices, because culture is such an important part of the firm, nothing compares to the value of being together. We’re planning 2021 programs to bring our team together and ensure that our one-team culture remains strong.
How has M&A performed during the pandemic? Have the events of 2020 changed where you look for M&A opportunities? If so, how?
2020 began with a very robust pipeline of M&A opportunities—and we weren’t alone when we saw a slowdown by March. This was due to the markets, and our decision to focus on our operations playbook. However, activity accelerated in the back half of this [past] year. We typically source around 1,000 new opportunities each year and we’re on track to meet that figure. To date, we completed four buy-side investments, signed a sell-side agreement, and there is more to come. If 2020 changed anything in how OpenGate sources, it’s that we leaned into our relationships with restructuring firms, banks and, most importantly, leading corporations so that we’re ahead of marketed processes.