Vista Equity Partner’s Robert F. Smith: Credit Offers the Best Risk-Adjusted Returns

Robert F. Smith, founder and CEO of U.S. private-equity firm Vista Equity Partners, said private-credit investment offers more attractive returns than buyouts, predicting massive growth in the asset class.

“We will continue to see massive amounts of growth in private credit. On a risk-adjusted return basis, at least in our industry, that is the best I can see,” Smith told the Super Return Private Equity conference in Berlin.

He said that the software sector – where Vista has built its reputation—lends itself particularly well to credit investing.

“One of the best ways to invest in the software space is in the credit. These businesses have high recurring revenues and high retention rates,” he said.

Since Smith founded Vista in 2000, the firm has consistently ranked among the world’s best-performing private-equity firms. In 310 investments Vista has never lost money, Smith told the conference.

Alongside its flagship private-equity strategy which gathered US$11 billion last year, the firm has also moved into private credit. Vista launched its credit arm in 2013 and has deployed over US$1.6 billion, according to its website.

Source: Private Equity News