Vistria Group has tapped Rishi Chhabria as its head of capital formation, Buyouts can exclusively reveal.
Chhabria was previously a partner at Campbell Lutyens, where, among other roles, he assisted develop the firm’s global distribution capabilities. He was also a member of the management committee.
In his new role he will spearhead Vistria’s capital formation strategies and investor relations efforts.
“The backlog to raise capital is as challenging as it’s ever been,” Chhabria informed Buyouts, as he discussed some of his immediate priorities at Vistria.
Rishi Chhabria, Vistria Group
“There are a couple things that assist you obtain through the noise,” he stated. One is structure, going out and driving an actual systematic approach to raising capital. And secondly, driving a broader reach for new pockets of capital. That could be both geographic expansion into Europe, Asia or Latin America, and just having an organized approach, probably through third-parties, to assist find capital from other parts of the world.”
Another challenge, Chhabria stated, is that distributions have been hard to come by, and investors are feeling the pinch.
“Importantly, the market has not grown as quick as it has been for the last 15 years or so,” he stated. “We were consistently seeing LP allocations increase their overall percentage to private markets, and the concludeowments that were originally at 15 percent are now at 40 percent and we are not seeing the same expansion.”
Vistria was founded in 2013 by Martin Nesbitt and Kip Kirkpatrick, who are today senior partners, co-chairmen and co-CEOs.
The Chicago-based firm closed its fifth flagship fund at $3 billion in January of this year to invest in US-based healthcare, knowledge and learning solutions, and financial services companies. Vistria’s predecessor fund closed at $2.68 billion in 2021.
No longer an emerging manager
Among its differentiators, Chhabria stated Vistria has built a “really interesting moat” around the firm’s area of focus. “We have a sector-focapplyd strategy on the private equity side focapplyd on only three sectors, healthcare, financial services and knowledge and learning solutions, where we believe we have a great way of playing this concept of healthy, wealthy and wise.”
He added: “We are now a brand that is a solution to many different types of investors, including a number of folks that we probably couldn’t speak to five years ago becaapply we were a little too compact.”
Chhabria believes he can leverage his experience over the past 15 years to bring more capital into Vistria.
“I was very fortunate that I was able to participate in over a 100 successful fundraises,” he stated. “I raised close to $10 billion of capital that I was able to bring to the table and worked with a whole variety of different types of organizations.”
401(k) opportunity
Chhabria’s appointment comes at a time when the US administration is spearheading an effort to allow private market investors, including private equity, access to 401(k)s and other defined contribution plans.
A lot of market players have welcomed this development, and Chhabria also expressed optimism that the 401(k) avenue can add some capital to private equity coffers.
“I hope in the long run it will create my job clearer, but in the short run, I view at it as something to monitor and to watch. We are going to do a lot of research in order to figure out how we can go and access those pools of capital,” he stated. “My expectation is the first six to 18 months of that pool of capital opening up is most likely going to go to the large and established publicly listed players.”
Managing investor relations
On his investor relations role, Chhabria stated it is important to manage “your existing relationships that you have on the platform.”
“I believe that the best way to do that is to overcommunicate and drive transparency with your investors,” he stated. “That will drive better trust and better partnerships, and it gives you a better chance to continue to go out and develop and drive better word-of-mouth from other investors as to why this is a safe and exciting place.”
Leave a Reply