 Last year, investment professionals indicated optimism about the future, despite being in the middle of a pandemic. A year later, the Asia-Pacific private capital market is recovering its strength and compensation levels are rising. Our HydroKin Struggles annual survey of investment professionals in the Asia-Pacific region revealed the industry's ability to handle difficult market conditions, setting a favorable context for hiring and compensation in 2021. Let's discuss how private equity firms in the region navigated through the changing landscape and how leadership roles in hiring are evolving in response. Shadi, what were your three main takeaways from the Asia-Pac private equity compensation survey this year? One of the key findings was the steady increase in cash compensation in the private equity industry overall, despite grappling with the after effects of the pandemic. Additionally, I think the sectors that have shown the greatest resilience in the past three years, including through COVID, were healthcare, consumer technology, and renewable sectors. We've also notified that private equity firms are moving more into multi-strategy approaches, where industry experts combined with local knowledge will become certainly in high demand. Stephen, based on the report findings, can we conclude that there is a sense of cautious optimism compared to last year? I guess a couple of things in play here. First, certainly there's more funds being raised. However, it takes a number of years to deploy the capital and see the results. So the two don't always synchronize at the time. Second, when we did the survey, the secondary market was picked at its valuation. When it comes down, it takes longer for the PE firms to seek an exit for their investments. And third, although a lot of the travel restrictions have been lifted, still people are restricted in travel. So a lot of the PE deals need to have a face-to-face conversation to close the deal. We see certainly those cautious sentiment out there. As Asia continues to outperform in terms of raising capital, we're seeing that in local and regional funds that are performing exceptionally well, local knowledge and language capabilities is a key driver in giving them an edge. Sash, what trends are you observing in the talent scene? This survey has really come at a time where dry powder and deal-making globally has really been at a record high. What we're hearing from clients is the velocity of virtually everything has been accelerated. Deals are being completed a lot quicker. Funds are being raised a lot faster. Exits are presenting themselves a lot sooner. Financings are being executed a lot faster. And I think more so than ever before, the accelerated impact from disruptive technology and social change has really powered, if you like, an appetite for private capital. And this has really had a significant impact on talent across the PE landscape. For one, within the investment professional talent pool, we're certainly seeing a diversification play as funds are really looking to expand beyond core buyout. And we're seeing a lot of momentum in niche areas like infrastructure, TNT growth, social impact. And I think this has really powered a lot of incremental hiring for PE funds at the investment professional level. The other interesting change that we're really observing is the role of the operating partner has really changed in the last 12 months, with dry powder being where it is and with increased demand and competition for deals, valuations are at a record high. And so value creation is really not about pure financial engineering, but it's about rolling your sleeves up, taking an active operational role in these assets, but also leveraging the portfolio to drive value creation. And I think the role of the operating partner in this new landscape has really gained in significance. Final piece around talent is really the impact of PE and VC money on the overall ecosystem. VC funds are looking at generating and building that next unicorn. They're really over-investing. And entrepreneurs are really looking at growth and driving growth in a significant way. So we're seeing a lot of demand for niche skill sets in areas like product and engineering where there is an imbalance between demand and supply. Steven, what are some China-specific challenges that PE firms are facing today? How is this impacting compensation and hiring? All the major firms are playing in China and it's getting mature over time. People are accumulating experience. However, if you look at China closely, the investment landscape is still heavily driven by policy change and military framework and micro-economics of China. And those tends to go up and down over time. And also, you have the tendency of overshooting valuation when it's high and also over-correction when the policy is not in favor of investments. So having said that, the base salary and the basic bonus goes up in inflation over time. The project bonus, though, and the carry expectation, it does get affected by policy change. And we have since then to the government taking a pretty hard steps on education, some internet players. We see that reflected in the sentiment. And then finally, because it takes longer to exit some investments, and we see it getting challenging to attract talent to move, the mobility has been somewhat subdued because people will stay where they are and wait to see what will happen in the next few years. Shadi, what trends are we seeing in the PE industry in the Middle East region? Have leadership needs and roles evolved in the last year? It's very interesting times for the Middle East in a similar fashion to what we're seeing in Asia-Pacific after the challenging year that the activity in the region is just showing an upward trend. And it's indeed very promising. One of the major aspects is, traditionally, I have seen a lot of activity in healthcare, education, financial technology over the years, but now we see more interest in a wider variety of sectors. There's dominance for the public sector involvement in this domain, mainly through the sovereign wealth funds in the major countries here. This year has shown a significant comeback as well to a private sector, privately held fund business compared to the previous year. So overall, the picture is indeed promising and easier times for private equity funds in the region. Sash, has the shift to digitalisation during the pandemic affected the private equity industry in any way? Has this affected demand for certain skills? I think technology has really been the dominant theme in investing, particularly in India and in Southeast Asia. The geo-effects in India has certainly had a broad impact on technology investing, consumer tech, as well as in services. In Southeast Asia, it's really been the lead that's driving growth across all markets in the region, and I'll certainly be interested to keep an eye on some of the IPOs that are imminent because they will serve as a bellwether for deal activity in the future. In terms of technology and the impact on talent, I think we're really seeing it as firms look to capitalise in the disruptive power of technology on sectors that have a long-term structural element to them, whether it's the future of consumption, the future of education, ageing populations, healthcare, but also that broader digital economy and financial services ecosystem. So I do think we're seeing the emergence of a number of sector-focused funds in areas like health tech, ed tech, fintech, ag tech that would continue to drive hiring and growth over the coming years. But equally, we're also seeing technology have an impact on other sectors, particularly in the e-commerce boom in areas like logistics, e-commerce fulfilment, but also in digital infrastructure and data centres in 5G. So I think these are sectors where we would continue to see a lot of hiring in the next 12 months. But I think the final piece is really around technology as it relates to value creation across assets, whether they're tech-related or not. Technology is going to be a dominant theme in driving the exit narrative of a lot of assets as they come to market over the coming years. People and leadership will be a key differentiator in giving PE firms the flexibility to capture value across sectors and asset classes. It will all come down to finding the right talent for helping these firms adapt to and navigate the changing landscape. To wrap up our discussion, I also want to hear from you all on the opportunities you foresee in 2022 and the talent needed to succeed. What opportunities do you see for the APAC private equity industry going forward in 2022? One of the themes that reflected in the survey was the firms taking on the multi-strategy approach. We have seen pension funds adding venture capital investment arm. We have seen buyout firms adding public equity and credit funds and going to the early stage investments. So all of those created opportunity for a unique set of talents to demonstrate their capability and then basically realize returns in a challenging environment. In China, there's the trends of the local for local. We raise funds locally and invest locally. Given the restrictions today, I think a lot of the local funds could have an edge over the cross-border global funds here in China. As funds continue to raise exceedingly larger sums of capital, this emergence of sector-focused funds would really have an impact on the industry. And as firms go deeper into sectors like healthcare, agriculture, food, financial services, education, the type of people that they would look to attract would not just be investors. I think investors really are important because they bring the fundamental financial deal structuring and diligence expertise. But as they go deeper into sectors like healthcare and ag and food, the science and the innovation and the technology aspects of it would be equally important as they look to deploy capital. So it's really about having the deep sector expertise that you need in order to deploy capital but also return capital. And I think the future for private equity is not just hiring investment professionals, but it's really hiring people who bring broader skill sets from an industry and an understanding of the industry dynamics perspective. Tradi. I think improving the regulatory framework in the Middle East and some of the other markets will certainly encourage more international capital to be injected in major parts of the Middle East given the interest of major sovereign wealth funds and government authorities, particularly in Southeast Asia and China, and that exchange of capital happens between the Middle East and Asia. So that's another major opportunity. This will certainly require further expertise for organizations here to see people who understand these markets but also understands new segments and sectors that this region has not really seen a lot of activity and in the past particularly in either technology or technology oriented sub segments. The other opportunity lies in the emergence of the venture capital money. This is where we see a lot of activity and capital injected into the vast variety of regions recover and that sort of conversions of venture capital money into private equity situations will certainly require a lot of attention and a fresh approach to a way review talent to these situations.