by Logan Henderson, Founder and CEO
It’s a well-documented fact that individuals are increasingly investing in private markets, and this is likely to accelerate when considering the future performance of a public stock portfolio.
The fear is that individual investors will invest more heavily in SPVs run by managers with no skin in the game (not deploying any of their own money into the deal). SPVs can bundle together any type of investment opportunity, including those that may be high risk or have little oversight and governance. This can lead to investors taking on more risk than they may be aware of or comfortable with.
Investing alongside managers who have experienced multiple economic cycles and have the discipline to follow a sound long-term strategy is key to capturing returns in today’s environment. These managers that have discipline on price, ownership, and selection, enable investors to build portfolios of private market companies with strong advisory teams who understand their businesses, have a perspective on the broader market outlook, and the experience to weather volatility.
Originally published May 19, 2022
