“During 2008 there were literally dozens of managers and partnerships out there looking to set up new private equity funds in Colombia,” says Daniel Wasserman, investment principal at Aureos Colombia Advisers in Bogotá. “And they were all trying to raise money from the same half-dozen Colombian pension funds. I think only two or three succeeded, certainly not many more than that.”

Aureos, of course, is one of the success stories, having made the US$35.8m first closing of its local Colombian fund last October. Bogotá and Lima, Peru-based Altra Investments is another. Between May and November 2008, it raised US$75m for its FCP 1 fund from Colombian institutional investors. But others found there was just not enough to go round as a stream of liquidity squeezed to a trickle in the second half of 2008. While Colombian businessmen express relief that the country has so far escaped the worst premonitions of recession, it’s clear that bankers and fund managers have got much more cautious with their money.

“Their attention has become very much more focused on making sure they are managing their day to day situation rather than looking for new opportunities,” says Wasserman. “And even before the liquidity crunch really became apparent, many of the pension funds were becoming overwhelmed by the sheer number of visits and placement memoranda they were receiving.”...

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