The pool of private investment options grows more crowded by the day. Most LPs are inundated with pitches from eager GPs/sponsors yearning to forge new relationships and messages from current GPs/sponsors seeking to nurture existing relations to avoid future abandonment.

Despite the fact that the investment industry tends to be characterized by endless self-promotional fluff, there are periodic moments of profound insight that positively enrich our collective knowledge. It is always so fulfilling when enlightenment accosts you without any prior

A couple of decades ago, when I was just starting out as an analyst, I remember getting word from a GP that one of the key people at the fund was leaving. The departure did not trigger a wholesale key

While mulling over multiple ideas for my next piece, I received inspiration from an unexpected source. I was delighted to have stumbled upon a topic that falls in the gray area of GP/LP dynamics that is seldom discussed. The light

More often than not, the term “lessons learned” is used to imply some degree of intellectual honesty. In the world of finance, this phrase is a valuable shape-shifter. It can be used to show introspection when an investment manager embarks

Humans are generally more prone to believing, being affected by, and/or responding to negative than positive information. Case in point, many of us have been dissuaded from purchasing a predominantly positively rated item or service because of one (or a

In my mind, I swore I would not succumb to the clockwork traditions of the investment industry where strong opinions are pedaled with little regard for accountability. Many of these practices are nothing but self-serving marketing schemes. New year predictions

This time last year, I put out “My 2024 Anti List“, a compilation of actions I hoped GPs would refrain from taking in 2024. I figured I would continue the tradition for 2025 with the same disclaimer of not trying

As an active participant in the private investing ecosystem, I am subconsciously urged to join the ubiquitous fray of end-of-year retrospections. However, I want my entry to be low-fuss and low-stress. As we all know, the investment world is extremely

Allocator peers I have come to know well throughout my career have, at one point or another, strongly recommended or shamelessly professed their love for a particular manager. I am guilty of doing the same. Nerding out on managers with

A few weeks ago, I posted Part 1 of the “Unbearable Lightness of Being a Fund 1”. As promised, I am delivering Part 2 of what I hope is helpful guidance, or at the very least, interesting and concise reading

After over two decades of investment manager/sponsor assessments, I have concluded that “the worst time to conduct due diligence on a GP is when that GP is officially fundraising”. Although this statement has provocative overtones, embedded are large deposits of

On the surface, the common maxim “capital is capital” might seem to predominantly drive GP decisions when raising capital. However, seasoned fund managers will be the first to tell you that there are strings attached to where their raised capital

Bearing the moniker of a first-time fund can sometimes feel like you are walking around with the words “cursed” or “kick me” tattooed on your forehead. Even from my privileged viewpoint as an allocator navigating inbound capital requests all day,

Taking time to process the sheer number of private deal sponsors in the investment market can be extremely disorienting, yet many asset managers turn coy when asked about competitors. Their assumption seems to be that providing accurate information about their

Almost everybody has heard these sage words of advice from a parent, guardian, coach, pundit, teacher or mentor: “if something sounds too good to be true, it probably is”. In the world of finance, this assertion particularly forms the bedrock

There is one thing that every GP/sponsor has up their sleeves when challenged about what makes them unique, which is their people. Since no two individuals are alike, it stands to reason that no assembled teams are identical. Here, “unique” implies

Most investors will swear on their firstborn child that they seek to partner with investment managers who can create value through varying market conditions. Despite market cycles being a broadly acknowledged inconvenient truth, finding cycle-tested guides to navigate ongoing market

With 48 weeks of weekly writing under my belt, I now feel like a DJ who’s played some old crowd favorites, some new weird stuff that the kids are currently vibing to, and his own collection of underground bangers. Although

Manager (General Partner/Sponsor) Due Diligence Challenges Some of my recent writings have discussed what can destroy or disrupt relationship-building momentum between general partners (GPs) and limited partners (LPs), as well as what typically populates the “Concerns” section of LP due

I am willing to bet my life savings (consequential to me but inconsequential to some, depending on how much you are winning at life – hahaha) that all staunch private investing proponents have found themselves in a room (probably several

Although some in the investment world feel it is their birthright to manage money or assess those who manage it, many others embrace these functions as immense privileges. Applying a curious mind to determine what variation of people, processes, and

The bone-chilling coldness of being professionally iced is agitating, irritating, and baffling at the same time. Many societal segments call this phenomenon “ghosting”, which means suddenly disappearing from one party after they believed a connection, relationship, rapport, or traction had

I have written previously about the tension that naturally exists between LPs and GPs. Clear business expectations, psychosomatic land mines, unspoken etiquettes, and a glossary of punishments for nonadherence to implicit and explicit rules complicate this symbiotic relationship. It is

Every private assets due diligence report has “thoroughness” or the “impression of thoroughness” as an explicit or implicit goal. Why would you lock up capital for such a long time without adequate probing, prodding, analyzing, assessing, devil’s advocating, and soul

In addition to the determination of capital loss and excess volatility risks, the assessment of “reputational risk” is vital when evaluating investment opportunities. However, reputational risk is among the most difficult to quantify since no standard measurement system is available.

I can vividly recall arriving 30 years ago in suburban Millersville Pennsylvania as a young African kid, ignorant as ever, ready to begin my undergraduate studies. Many things were foreign to me. I was clueless as to what other kids

The prevalence of “groupthink” among prospective LPs is one of the most frequent complaints I hear from fund managers actively seeking capital. It is generally understood that “groupthink” in investing refers to a group of investors clustering around one viewpoint

A few weeks ago I wrote about the critical role placement agents play in conducting the intricate orchestra of GP messaging, LP requests, and fundraising herding. Although many placement agencies are gradually evolving into a holistic business model that assists

Competitive Landscapes We know you think your baby is the cutest, smartest, and most infallible ever to live. We also realize that asking you to critique your baby is difficult, as it would be like criticizing yourself. Outsiders, however, do

In the movie Heat (1995), Robert De Niro’s character says to Al Pacino’s character “Don’t let yourself get attached to anything you are not willing to walk out on in 30 seconds flat if you feel the heat around the

A natural and very understandable insecurity expressed to me by many emerging managers is how their strategies compare to other funds in my portfolio. Through individual reconnaissance and the assistance of a motley crew of advisors, emerging managers usually have

Despite holding positions that champion flexibility of thought, investment analysts on the allocator side still, admittedly (or not), are plagued with several dogmatic habits. Many of my past writings have self-servingly accentuated the plight of allocators and accusingly cried foul

A complex, sometimes abstract system of changing/evolving power dynamics lies beneath the consequential high-stakes interactions between LPs and GPs. In GP/LP exchanges, the human element, at points, can convincingly obscure business realities, but power flexing at critical stages of engagement

Analysts often use the concept of “repeatability” to support an investment thesis and demonstrate conviction in an investment opportunity. By believing that “repeatability” exists, you can feign protection (or create a sense of security) against the greatest investment threat, the

For emerging and established managers alike a “first close” comes with a profusion of sentiments. A first close is a multiheaded chameleon that harbors many characteristics and uses – it can be an existential marker, a customary show of fundraising

After the warm or cold initial LP solicitations, introductory meetings (virtual or in-person at the allocator’s premises), and ongoing communications, but before the full consummation of a commitment, the prospective LP visits the GP’s office. This is an opportunity to

When approaching prospective LPs, GPs should ponder the multi-dimensional puzzle these investors are trying to solve. In addition to a strategy’s viability and potential to generate outsized returns, many other factors need consideration when constructing a portfolio. During my career,

There is nothing enjoyable about rejection, no matter how it comes. In the case of fund GPs/sponsors, rejection is especially painful when they have displayed transparency, authenticity, and the potential for strong future returns. A mere rejection, however, does not

As I have incessantly ranted about in past writings, an investment analyst’s inbox has the characteristics of a dark and eerie swamp. Wading through the chest-high sludge of unread messages, reference requests, quarterly GP correspondences, annual meeting invites, current manager

The “GP and prospective LP” dynamic is a complex one. The moving pieces are dizzying at best and indecipherable at worst. The asymmetricity at play resembles a game with everchanging rules – an appropriate reaction to this is “nonplussed” –

I vividly recall sitting in multiple finalist presentations where the prospective clients’ gotcha question was “Can you please tell us how you source investment ideas?”. I could always tell this was a loaded question because everyone has an opinion on

The frenetic pace of information synthesizing and the sheer number of arbitrary tasks that make up a research analyst’s work life sometimes cause things to slip through the cracks. I have placed considerable emphasis in past articles on the importance

From an allocator’s perspective, regardless of how inclusive (for legitimate or CYA reasons) due diligence appears on the surface, it remains a very lonely endeavor. A research analyst’s solitude is further intensified when assessing a private assets investment opportunity. In

I have always pondered the difficulties placement agents must face while pursuing excellence in their jobs. There are, however, so many placement agents in existence, enough evidence of capital raised via placement agents, and tangible evidence of financial reward as

Dear Venture Capital, It has been a while now since we first met, and I must say it’s been a whirlwind of a ride. Even though you admirably suppress your true volatile nature with time lags and optimistic sentiment, you

It is universally known that email inboxes are very scary places. As you enter your inbox, the specter of unread, follow-up, and still-to-be-responded-to messages create an ever-present menacing feeling that we all battle daily. The inbox of a capital allocator’s

In private assets investing, although capital tends to be locked up for a relatively long time, and LPs have little ability to alter investment outcomes, “information” remains king, queen, and executioner. I always encourage GPs to embrace their leadership role

In investing, taking the path least traveled is almost always ideal. However, for exceptional returns (top quartile) relative to peers,  not only do you have to be alone (or among very few others), but you also have to be right

Every serious investment research analyst knows about the “leap”. The leap is what gives you the confidence to embrace the unknown. The willingness to leap is what fortifies your resolve to go against or be with the crowd. Regardless of

Even more than the illiquidity (long lock-up periods), relative lack of transparency (initial black box in most cases), and complexity (difficult to easily assess options), private assets fund “fees” draw the most criticism. Management fees typically average between 1.5% and

The ultimate goal for most private equity investors is for their private holdings to eventually become self-sustaining. This means that private investors ultimately want distributions from prior investments to one day cover or surpass ongoing capital calls. When this happens,

I will always be the first to proclaim that in the drudgery of private assets research and investing, anything that disrupts the mundane is a good thing. The year-in and year-out slog of endless pitch meetings, financial model dissections, never-ending

I cannot pretend to fully understand the anguish GPs go through when fundraising. I can only imagine the logistical nightmare that comes with herding potential LPs of varying categories, geographies, concessions, and concerns/questions. Roundtripping a fundraising cycle must be a

At its core, investing is the utilization of research, perception, psychology, hard facts, data extrapolation, scenario projection, human behavior, trust, intuition, and goodwill to attempt to sneak a glimpse of the future. The truth is that this dynamic concoction of

One of my goals as a research analyst is to attempt to use critical thinking to uphold or dispel the mystique behind certain widely accepted aspects of private assets investing. Many of these notions sound good when spoken or written

“What is your target fund size?” – this is one of the first questions asked by LPs (Limited Partners) to GPs (General Partners) when contact is initiated. This question is foremost in the minds of LPs because the answer houses

Portfolio construction in private assets investing is a domain saturated with opinions. Several schools of thought and philosophies exist around what elements to consider, how to execute, and what to avoid. Trying to develop a sound approach can be an

Keeping with the sometimes-annoying tradition of a plethora of “lists” at the close of the year, I want to put forth my own, but with a little twist. I want to talk about ”six” things I wish to see less

It is always cathartic to take inventory of oneself. Introspection provides a personal assessment of areas that you naturally know have to be improved. Although self-examination does not necessarily have to lead to self-criticism or a feeling of inadequacy, the

Although it seems like private assets investing is at the height of its popularity with ubiquitous mentions across social, economic, financial, and cultural media, many institutions, entities, and individuals still hesitate to take the plunge. The most common reasons for

The top of a limited partner’s (“LPs”) funnel is a concept that most general partners (“GPs”) find hard to appreciate. The sheer number of investment opportunities from various sources including fund managers themselves, placement agents, re-ups, market mapping, etc. can

Throughout the years, I have had countless conversations with fellow analysts about how our job as professional skeptics permeates all areas of our lives. Whether watching a television commercial, discussing the premise of a show or movie, going shopping, or

As part of the fellowship of analysts, allocators, and investors seeking consistent, uncorrelated, and outsized returns, these lines from the band Oasis’ 1995 smash hit song “Wonderwall” play over and over in my mind – “All the roads we have

I have always had a soft spot for funds of funds (“FoFs”). Maybe it is because my private assets career started as FoFs were making real inroads in the industry. It could also be because I consider FoFs a cherished

In my almost 20 years of private assets investing, the thing that has caused me the most disconcertion in the industry is the conspicuous, but intellectually masked, lack of individuality when choosing where to invest. The dearth of independent thought