In 2002, Mark O’Hare filed a public information request with the Massachusetts Pension Reserves Investment Management Board, requesting information about the performance of the private equity investments.
The state pension fund initially opposed the British entrepreneur’s move, arguing that the data was a trade secret. But a state official sided with O’Hare, helping him overcome an initial hurdle in his plan to set up a company that would sell valuable information about the secretive takeover industry.
The 65-year-old confirmed that bet on Monday with an agreement to sell his company, Preqin, to asset manager BlackRock in a £2.55 billion all-cash deal that would make him one of Britain’s richest people.
“It’s a fantastic outcome for a great entrepreneur,” said Anand Sanwal, co-founder of financial data provider CB Insights. “It’s an overnight success that’s been 22 years in the making.”
Preqin has become a key data provider for thousands of clients in investment and advisory groups. These clients have access to information on performance, fundraising, deals and terms for asset classes such as private equity and venture capital.
Its rise reflects the growth of private equity over the past two decades into a multi-trillion-dollar market, with buyout firms such as Blackstone and KKR becoming giants that dominated dealmaking and have become a staple in institutional investors’ portfolios.
Financial data companies have become prized assets as investors increasingly seek information to make decisions. S&P Global bought data research firm Visible Alpha this year, while the London Stock Exchange Group spent $27 billion acquiring data provider Refinitiv in 2019.
Other companies that have raised big money in recent years include Reorg and Leveraged Commentary and Data. London-based energy and commodities data provider Argus Media was valued at $4.6 billion, including debt, in January in a deal that saw its CEO take a majority stake.
Growth has been particularly strong in the private investment insights market, especially recently, as weak stock market activity has led to companies remaining in private hands for longer.
“There’s a lot of interest in private markets … and there’s not that much data assets at scale,” said Hiten Patel, global head of financial infrastructure, technology and services at Oliver Wyman. “There’s a scarcity of assets across the sector.”
Preqin faced competition from companies including CB Insights and PitchBook, which was acquired by research group Morningstar in 2016. The company was then valued at $225 million.
BlackRock paid 13 times Preqin’s expected 2024 revenue of $240 million. When PitchBook was acquired, the deal valued the company at nearly seven times trailing annual revenue, though it has been the biggest contributor to Morningstar’s growth since then, with revenue up about 23 percent last year to $552 million.
Preqin users say the company stands out for the comprehensive information it provides on private market fundraising and returns.
“You have to pay a strategic premium for quality assets,” Patel said. “Especially assets that have a scarcity value.”
The acquisition of Preqin by BlackRock, which has previously made no outside investment, makes O’Hare and his wife Lindy billionaires based on their 80 percent ownership of the company through their investment vehicle Valhalla Ventures, which is incorporated for tax purposes in the United Kingdom but is owned by a Jersey-based parent company.
The remainder is held by several hundred of the company’s 1,500 employees, who are expected to receive around £500m from the sale.
O’Hare, an occasional pilot who survived a 1999 plane crash in his seven-seater, has run the company as a family affair. He handed over the reins to his son-in-law Christoph Knaack when he stepped down as CEO in 2022. Lindy O’Hare remains a director of Preqin.
The lack of outside investors in Preqin gave O’Hare, who declined to be interviewed, more flexibility in how he runs the company.
He and his wife took out a £2.3 million loan from Preqin to finance their £2.8 million purchase of a farm in Suffolk in 2018. Although the loan from Preqin – which carries an annual interest rate of 3 percent and is secured by the farm – was due to mature last year, British company documents suggest it has not yet been fully repaid.
Valhalla Ventures is financing the nearby open-air Thorington Theatre, which the O’Hares built in a World War II bomb crater using wood from their own chestnut trees.
Preqin was sold in a competitive auction run by Goldman Sachs bankers that attracted interest from S&P Global and Bloomberg after the price topped initial estimates. It is chaired by Sir Bradley Fried, who until April was also chairman of Goldman Sachs International.
BlackRock, based in New York and the world’s largest asset manager, expects the Preqin deal to expand its reach into private markets, where it estimates assets will reach nearly $40 trillion by the end of the decade.
The $10.5 trillion asset manager wants to create indices and eventually offer tracking funds for private equity and other alternatives, expanding the reach of its iShares arm beyond stocks and bonds.
“We believe we can index the private markets,” BlackRock CEO Larry Fink told analysts Monday. “We expect indexes and data to be important future drivers of the democratization of all alternatives, and this acquisition is the unlock.”
Still, the deal comes as private equity executives warn they face years of lower returns after a decade of easier profits.
O’Hare will become vice chairman of BlackRock, a role with outward-facing responsibilities for clients and customers. He was previously a director of a BlackRock fund from 2011 to 2014, and BlackRock has been a Preqin data client since 2016.
Before founding Preqin, O’Hare launched stock information service Citywatch in 1993, which he sold to Reuters five years later. That was coupled with an early stint as an executive at the Boston Consulting Group.
O’Hare saw an emerging industry that offered financial data. And he built an early path, particularly in Europe, with the family offices and institutional investors that were pouring money into private equity funds.
“Mark is a guy who is very well liked in the industry,” said a financial data insider, adding that O’Hare saw itself as someone who would “become a partner to the industry and work with him on it.”
Some industry executives have questioned whether private fund managers will continue to work with Preqin, given that BlackRock manages nearly $250 billion of its own alternative funds. Preqin’s acquisition comes after the asset manager bolstered its private markets offering with a $12.5 billion deal to buy investment group Global Infrastructure Partners.
But Rob Goldstein, BlackRock’s chief operating officer, told analysts that “we’re actually pretty confident that we can actually grow Preqin’s reach” because BlackRock’s technology arm already worked directly with many fund managers who trusted it to protect their data.
“This deal makes strategic sense,” Deutsche Bank analyst Brian Bedell wrote in a note to clients, adding that combining Preqin’s data with BlackRock’s existing risk management technology should expand the market for both.
Additional reporting by Euan Healy and Will Louch