January 12, 2023
Key Takeaways
1. Venture capital is an important driver of returns for leading endowments. Accessing venture capital managers that are likely to outperform takes time, networks, and expertise which create significant barriers to entry for individuals and small investors.
2. Investing on behalf of mission-driven organizations has resonated with the venture capital community. The top managers often have a stable group of existing investors, and are only willing to add new investors if they support values-aligned missions. At GEM, our clients are a key differentiating aspect in this regard and something we are proud the investment community recognizes.
3. Selection is critical. Top quartile venture capital firms have added at least 14% above the S&P 500®, but the median fund has beaten the S&P by merely 2%.
As Matt Bank discussed with Institutional Investor, institutions should avoid the comparison game as endowment return season gets underway and focus instead on simply running their own race.
Many OCIOs remain divided on the issue of scale: some believe it is necessary for growth, others believe it can inhibit the search for alpha. Matt Bank shared his views with Pensions & Investments.
As part of Pensions & Investments’ OCIO Special Report, Matt Bank discussed how a crowded OCIO universe has presented challenges for institutions seeking to vet the right outsourced provider.
Let’s start a conversation about how we can help.
