Assertion Supported
Lacaillade: Founders Fund, a16z, Greenoaks, and Thrive proactively marked down valuations
“In my core relationships Founders Fund's the most extreme, because Peter Thiel's very contrarian and he wants to reset the mindset of his team. Which I think is great. But Andreessen Horowitz, Green Oaks Thrive, they've all proactively marked down their compan…”
Opinion
Lacaillade: Top PE funds never list on investment bank platforms
“But if you think of like, if you're a Goldman Sachs or Morgan Stanley or whatever, like the funds they put on their platform are large cap funds that are having trouble distributing They need, like, we invest in ADVENT in the large cap bio. We invest in ADVENT…”
Insight
Lacaillade: Single family offices require at least $5B net worth to justify
“Like, I mean, I think it's definitely not a billion dollars. Like, I think it's, you have to be maybe worth ten billion. At least five.”
Insight
Lacaillade: Banning co-investment carry incentivizes fund size over alpha
“By saying you can never charge carry on a co-investment means that they're just going to solve for a bigger fund and become asset managers and not deliver the alpha that we all want as investors.”
Insight
Lacaillade: Track record ranks fourth or fifth when evaluating fund managers
“Track record is important. Like it tells you, do these people know how to invest? Like, are they smart? But for me, and I say this often, it's like, maybe it's number four or five on my list of things that are important, like the quality of the team. And we ca…”
Prediction Not checkable as stated
Lacaillade: SCS halves commitment sizes for VC funds deploying within 6-12 months
“So I would size my commitments accordingly. So it's like, if you tell me you're going to put out your fund in six to 12 months, I'm just going to size you at a half bite.”
Prediction Not checkable as stated
Lacaillade: Access to top VC managers will remain open over the next few years
“It's a really good time to start a program. If you want to get into badass, like, Really good managers right now, you can do it. And that probably, and that will probably be the case in the next few years.”
Prediction Not checkable as stated
Lacaillade: Lower middle market buyouts will generate venture-like returns
“I'm spending like, the vast majority of my time on lower middle market buyouts. And I'm so excited about like the opportunities that I'm seeing. And actually, I'm going to generate like venture-like returns. In small cap, EBITDA positive businesses, right?”
Prediction Not checkable as stated
Lacaillade: Seed fund baskets deliver 5x net vs 2.5-3.5x for franchise funds
“The basket I think can do five X of those seed funds versus what do I think? Like a franchise firm can do two and a half, three X net, maybe three and a half.”
Assertion Supported
Lacaillade: Big secondary investors avoid venture capital, creating a market gap
“Most of the secondary people are not really comfortable in venture... I think all the big secondary players skew towards heavily towards buyout portfolios. So there's a gap in the market.”
Disclosure
SCS Financial Took 25-30% Venture Write-Downs But Maintains 29% Net IRR
“I feel like we've written down our portfolio In the venture, when I say we, our managers, I don't know, it's like, 25%, 30%? After having years of hundred percent IRRs. So it's still good. It still looks good. I think it's a 29% Net IRR after all that, and the…”
Prediction Not checkable as stated
Lacaillade: Venture portfolios have absorbed 70-80% of valuation write-down pain
“And I don't think we've taken all our pain. I think there's more to come, but I think we've taken like 70, 80% of it.”
Disclosure
Lacaillade: SCS exited manager at 104 cents due to ethical issue
“I also sold a manager that we got out of because of some ethical situation at one Oh four.”
Insight
Lacaillade: Lower middle market buyouts offer a repeatable 3x-5x return model
“So you buy a founder led business, you professionalize it, you buy it at like six to eight times EBITDA. You put on like maybe three turns of debt, maybe three to four, depends on the business, but you professionalize it, you grow it, say it had five million E…”
Opinion
Lacaillade: Using placement agents is a terrible sign for venture funds
“I'm not saying I would, Completely rule out a venture fund that had an agent, but it's a terrible sign.”
Insight
Lacaillade: Optimal private equity portfolios require 60 to 70 active GP relationships
“I think it's the diversification piece in, in private equity, the way to build an optimal portfolio, which I think is, I have 60, 70 active relationships in private equity. I think there's a lot of people out there that say it should be like 20 to 30.”
Insight
Lacaillade: In a 10-fund LP portfolio, 3-5 exceed expectations and 1-3 underperform
“If I do 10 funds, what I've found is three to five exceed expectations, three to five meet expectations, one to three underperform.”
Assertion Partly supported
Lacaillade: Charter rules block large state pensions from sub-$1B funds
“They have a rule in their charter that they can't be more than 10% of a fund. And they can't write less than a hundred million dollar check. Therefore, they can't invest in funds that are smaller than a billion dollars.”
Insight
Lacaillade: 95% of LP peers rely solely on manager-provided reference lists
“I think 95% of my peers just like do the reference list.”
Disclosure
Lacaillade: My past prediction that 85-90% of SPACs would fail was too generous
“At the time, I said SPACs were gonna, I made the comment, like, I was like, 85, 90% of these SPACs are gonna be a disaster. And it turns out I was wrong. I was too generous.”
Prediction Not checkable as stated
Lacaillade: SCS's 2020-2021 co-investments will yield 2-3x instead of 4-6x
“If I look back and I did a bunch of co-investments, like in what I believe to be like great, in some cases, great companies. Right. But they're going to have to grow into their multiples. So rather than making four to six acts, we'll make two or three acts.”
Assertion Supported
Lacaillade: Multiple billion-dollar-plus venture funds have achieved 5x-plus returns
“Founders Fund, like, there, if you, I mean, I'm saying some of the data, like, there's, I, there's a number of examples of big funds being five X plus, right?”
Disclosure
Lacaillade: SCS Financial's IC rejected under 5 deals in 12 years
“The investment committee I mean, I can count on one hand the amount of funds or co-investments that have been declined in my 12 years, and I remember them well.”
Disclosure
Lacaillade: SCS sold tail-end fund stakes at 94 cents in late 2021
“We sold, we were able to execute a secondary sale of, like, a bunch of, like, tail end stuff with managers we weren't continuing to back at, like, 94 cents in the fall of 21.”
