Winkelried Says a Shocked TPG Starts Probe Amid College Scam
Winkelried Says a Shocked TPG Starts Probe Amid College Scam
(Bloomberg) -- Jon Winkelried, co-chief executive officer of TPG, said the firm was shocked over the charge against Bill McGlashan and has undertaken an internal investigation to see if his activities bled into parts of the business.
“A couple of weeks ago when this news first broke it was, as you might imagine, pretty shocking,” Winkelried said Wednesday at the Bloomberg Equality Summit 2019. “This is something that we had no knowledge of or had no idea this was all happening, and so anytime something like this happens, it takes your breath away for a minute.”
Private equity giant TPG said it fired McGlashan earlier this month after he was charged as part of the wide-ranging college admissions scandal. McGlashan led TPG’s business focused on social good and founded its growth investing platform. The firm has given investors a chance to withdraw their commitments from the second social impact pool following the indictments, Bloomberg has reported.
Winkelried said investors had a lot of questions and have also been “very supportive.” He said they understood the context that McGlashan was acting on a personal basis.
“What we’ve committed to our investors is that we’ve undertaken an investigation internally to make sure none of the things that Bill was engaged in were in any way, shape or form bleeding into the business,” he said. “We owe that to our investors.”
McGlashan was charged with other parents for their role in schemes that involved paying coaches and college administrators to get children into top colleges. The government said clients paid $25 million in bribes from 2011 to 2018. McGlashan discussed paying at least $250,000 to get his son into the University of Southern California, according to the criminal complaint.
McGlashan, in a note to board members, said he resigned and that he’s “deeply sorry this very difficult situation may interfere with the work to which I have devoted my life.” He added that “there are aspects of the story that have yet to emerge that I wish I could share.”
The TPG fund, known as The Rise Fund II LP, is still aiming to close this year with $3 billion. Existing investors in the second fund, which held a first close in February, are Washington State Investment Board, New Jersey Division of Investment and San Francisco Employees’ Retirement System, according to data compiled by Bloomberg.
Encouraging Diversity
Winkelried mentioned actions the firm has taken to increase inclusiveness and diversity.
He said the 2019 incoming associate class is 50 percent women or minorities and the representation in the next class is getting close to half.
“Where you have a harder time moving the needle is the old white bro guys that have been there a long time,” he said, adding that moving a “diverse population through the organization is more of a challenge.”
TPG also changed its family-leave policy, making it “gender-blind” with 18 weeks for the primary-care giver and four weeks for the secondary.
The private equity firm has put together a list of 600 women who could serve on boards for companies in which TPG has ownership or influence, Winkelried said. He added they have already changed the board composition at 30 of its portfolio companies.
TPG, which is headquartered in Fort Worth and San Francisco, has more than $103 billion under management.
--With assistance from Jason Kelly and Alexandra Stratton.
To contact the reporters on this story: Janet Lorin in New York at jlorin@bloomberg.net;Heather Perlberg in Washington at hperlberg@bloomberg.net
To contact the editors responsible for this story: Margaret Collins at mcollins45@bloomberg.net, Vincent Bielski, Steve Dickson
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