Capital Allocators

On Investment Management Operations, Scott MacDonald speaks with Rob McGrail from DUMAC. With thanks to Octus.

Navigating hedge fund headwinds at Parsifal Capital Management, LP. My conversation with David Zorub. With thanks to WCM Investment Management.

My friends at Alliance for Decision Education have organized Forecasting the Future 2025, a free, public tournament that is open to any US-based middle or high schooler (ages 13-19). The tournament starts on March 31, 2025.

Check out the video of my conversation with Brett Barth and Evan Roth from BBR Partners. With thanks to WCM Investment Management, 10 East, and Thoma Bravo

Top quotes from my conversation with Brett Barth & Evan Roth from BBR Partners. 1. “Our mission is to provide wealthy families with peace of mind that their financial needs will be met.” -Evan 2. “People who hire us later say ‘you were the only ones who just listened.’” -Evan 3. "We were really good at learning from our mistakes. I used to say we made every mistake but we never made them twice. Our coach looked at me and said, 'Why make them the first time?'" -Brett 4. “As much as we are long-term investors, if you tell me you don’t care about mark-to-market volatility, you’re wrong.” -Brett 5. "The first thing I want to know about a money manager is, what do they think about in the shower in the morning? If it’s about their portfolio and their area of expertise, that’s someone I want to do business with." -Brett 6. "The most interesting alpha today comes from a lack of capital – either because something is unfavored, because of regulatory changes, or because it's still pre-institutional." -Brett 7. “Alpha in stock picking is as hard as it’s ever been. I'm not a big believer that that's going to mean revert in a meaningful way.” -Brett 8. “Without question, private equity returns will be lower over the next 25 years than they've been over the past 25 years.” -Brett With thanks to WCM Investment Management, 10 East, and Thoma Bravo.

Stewarding family wealth at BBR Partners. My conversation with Brett Barth and Evan Roth. With thanks to WCM Investment Management, 10 East, and Thoma Bravo.

Top quotes from my conversation with Michael Choe from Charlesbank Capital Partners. 1. “You can reduce one's life to a series of decisions you make every day.” ? 2. “We think about our firm as a manufacturing process where the atomic unit of production is a decision.” ? 3. “We moved a snapshot of the underlying value of an asset to a two-year fan of outcomes that describes a probability distribution.” ? 4. “We use two-year models because unless we are winning out of the gates, we are losing.” ? 5. “Our two-year fan of outcomes allows us to be much more specific in unifying our value creation plan with a modeling exercise.” ? 6. “Rather than looking at things that have a high base case, we look for companies with a very asymmetric distribution of outcomes towards the upside and very muted downside.” ? 7. “Our greatest asset is people. The upside of being a great human capital manager relative to the downside of having attrition of star performers leads to a whole set of investments that we've made to be more disciplined human capital managers.” ? 8. “It's much harder to create an investment firm where excellence is a result of a systematic process.” With thanks to WCM Investment Management, 10 East, and Thoma Bravo.

Atomization of private equity decisions at Charlesbank Capital Partners. My conversation with Michael Choe. With thanks to WCM Investment Management, 10 East, and Thoma Bravo.

Top quotes from my conversation with Ian Charles from Arctos. 1. "The management of a GP is a complex business. And as the firms grow and mature, that complexity increases in non-linear ways." 2. "Among 6,500 private market firms, just 15, or 0.2%, control 20% of the AUM. Moving down to level 7, 700 firms control 90% of the industry AUM." 3. "If you organize the industry based on 10 levels, you can understand why things are happening in the competitive landscape and what changes managers need to make to achieve their objectives." 4. “The market is changing, the client is changing, and the competitive landscape is changing in ways that require managers to level up their firm's capabilities, even if they just want to stay where they are.” 5. "The now narratives for Q1 are the elections impact on M&A and animal spirits, consolidation and M&A in sponsor land, challenges in the fundraising environment, and value-added capabilities." 6. "If private equity is not cheap relative to public equity, it is hard for the IPO environment or M&A to get excited." 7. "There are important ingredients to getting distribution yield back to normal - an accommodating macro environment, narrowing price and intrinsic value, the spread between the entry price, implied return on asset, the cost of leverage, and incentives and alignment.” 8. "Our job is to serve the entrepreneur on their journey. We do that powered by data and tools to break down the market, firms, and the competitive landscape." 9. “We want to disrupt and innovate the markets that we serve by solving complex problems with creative solutions. We do that in sports and in private markets, and we have a right to win.” With thanks to WCM Investment Management, 10 East, and Thoma Bravo.

Private equity's new rules. My conversation with Ian Charles from Arctos. With thanks to WCM Investment Management, 10 East, and Thoma Bravo.