“Show me the distributions” is a wonderfully efficient way to shorten an LP presentation.

Saves everyone forty slides on why the portfolio is performing magnificently despite the absence of any money.

The valuations are robust.
The assets are exceptional.
The exit pipeline is encouraging.

Lovely. The pensioners have asked whether they can spend the appendix.

Private equity gets paid to be patient. Fair enough. Building a better business takes time, and selling at a stupid price to manufacture liquidity is hardly investment genius.

But patience needs a business case. Especially when you’re asking LPs for another commitment while they’re still waiting for cash from the last one.

Every extra year should come with a specific explanation of what will improve, what it will cost and why the eventual proceeds justify the wait.

“Markets should recover” is a forecast. A board can do remarkably little to implement it.

It can, however, fix customer churn. Improve cash conversion. Reduce dependence on the founder. Build a management team the next owner actually wants to keep.

This is where value creation earns its fees. A buyer needs evidence that earnings will survive the handover, without six heroic assumptions and the CEO promising to stay forever.

And the source of a distribution matters.

Cash from selling a stronger business, cash from adding debt and cash from moving an asset into another vehicle deserve different conversations. The bank balance may look similar on arrival. The remaining exposure can look rather different.

LPs should care about how much came back, what produced it and how much risk they still own.

Slightly more demanding than pointing at DPI and declaring victory. Fortunately, this industry claims to enjoy due diligence.

Until then, congratulations on the valuation.

Do let us know when it becomes transferable.