‘Our funds are 20 years old’: limited partners confront VCs’ liquidity crisis
View original at finance.yahoo.com‘Our funds are 20 years old’: limited partners confront VCs’ liquidity crisis Cash stashed for safe keeping in between mattresses. | Image Credits:jmbatt / Getty Images These days, it’s not easy to be a limited partner who invests in venture capital firms…
What we drew from this source
The claims Via News extracted from this document. We point to the source; we don't replace it.
Stripe exposure in Makena's portfolio serves as a hedge against Visa, since Stripe could potentially use crypto rails to disrupt Visa's business
80% confidenceNetworks and domain expertise have a shelf life. Unless you're hustling to refresh those networks, to expand those networks, you're going to be left behind
80% confidenceI've been saying for 15 years that venture is not an asset class
80% confidenceMakena Capital now models an 18-year fund life, with the majority of capital returning in years 16 through 18
80% confidenceEvery LP and every GP should be actively engaging with the secondary market
80% confidenceNew managers should network to as many family offices as possible, as they are typically more cutting edge in terms of taking a bet on a new manager
80% confidenceThe best venture managers significantly outperform all the other managers, unlike public equities where managers cluster within one standard deviation
80% confidenceCompanies that preserved capital during downturn saw growth rates suffer while AI caught on and market moved past it, now face serious headwinds and may die if they don't adapt
80% confidenceIt's quite challenging to make plans around venture capital because of the dispersion of returns
80% confidenceMakena Capital has kept new managers steady at one to four per year with just two this year, but dollars deployed in Founders Fund is larger than emerging manager side
80% confidenceNobody has a proprietary network anymore. If you're a legible founder, even Sequoia is going to be tracking you
80% confidenceIn the first half of this year, Founders Fund raised 1.7 times the amount of all emerging managers
80% confidenceYou could have a north of 3x fund if you sold everything at the Series B
80% confidenceConventional wisdom may have suggested 13-year-old funds, but in our portfolio we have funds that are 15, 18, even 20 years old that still hold marquee assets
80% confidenceWhen Lexington comes in and puts a real look on valuations, they may be facing 80% markdowns on what they perceive their winners or semi-winners were going to be
80% confidenceConsumer will have a new wave. Platform funds have kind of put that to the side, so it feels like we're ripe for a new paradigm
80% confidence10 years ago, if you were doing a secondary, the unspoken thing was that 'We made a mistake'. Today, secondaries are most definitely part of the toolkit
80% confidenceA third of our distributions last year came from secondaries, and it wasn't from discounts, it was from selling at premiums to the last round valuation
80% confidenceIt's going to be really hard to convince a university endowment or foundation to invest in your little $50 million fund unless you're super pedigreed – maybe you're a co-founder of OpenAI
80% confidenceEstablished managers in total raised eight times the amount of all emerging managers
80% confidenceMany peer institutions became overexposed to venture capital and started pulling back their perpetual pools of capital
80% confidenceThe asset class is just a lot more illiquid than most might imagine based on the history of the industry
80% confidenceThe tourist fund managers who flooded the market in 2021 have largely been flushed out
80% confidence