Strategy
In general, historical evidence indicates that returns in the private markets do not persist over time. Managers and market segments that perform well initially, when they are smaller, less efficient, or less affected by competition, tend to perform less well as they grow and come to offer little to no alpha over broad-based benchmarks.
At its core, Barrel Rate seeks to generate an outsized multiple of capital by partnering with private equity general partners and independent sponsors who are able to identify proprietary opportunities, structure transactions with downside protection, and capture excess returns by growing their companies to a scale where market efficiencies produce excellent exit prospects. These dynamics exist independent of market cycles or debt availability.
While Barrel Rate will invest primarily in the United States, we also will consider opportunistic investments in other developed markets, such as Europe, while maintaining our focus on small-cap and emerging managers.
