The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 10 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Somerville: Structured equity downside protections often evaporate prior to exit
“Structure doesn't necessarily stay when a company exits. It gets negotiated out by management or the rest of the board, and so you can think that you've protected yourself with structure, and it ends up absolutely evaporating.”
Somerville: VC Funds with 3x-4x TVPI Can Accept 50% Secondary Discounts
“Now, if a fund is at a three to a four X and you're asking them to take a 50% discount, they're still going back to their board with a two X return and the ability from an opportunity cost standpoint to then deploy it. Into what we all expect to be very good v…”
StepStone: Venture funds have marked down portfolios by 15% to 20%
“I think we looked on average funds have come down around 19% on the venture side somewhere between 15 and 20, I would say, is, is what we've typically seen.”
Somerville: LP interest secondary discounts range 30-45%, company secondaries 20-35%
“On LP interest, a lot of what we're seeing is in the 30 to 45% range. A lot of what we're seeing on the company secondaries is in, like, the 20 to 35% range.”
Somerville: Lateral partner hires can disrupt firm chemistry and create organizational risk
“I think on the fun side, just underestimating the human element with people that join on a lateral basis that have great pedigrees that you think will be additive, it's not always that way. You can have someone join and it completely messes up the chemistry of…”
Somerville: LPs will downsize fund commitments rather than abandon top managers
“I think what you'll see is smaller investment sizes in the managers that they like. In the ones they really like, they'll just stay the same instead of growing. And in the ones that are on the fringe or in their, you know, respective penalty boxes, as you may …”
Somerville: Depressed IPO and M&A markets force creative secondary liquidity
“And particularly in an environment like the one we have now, where other liquidity options are more limited. You're not seeing companies go public, you're not seeing strategic M&A as a robust of a clip, and so they need to think more creatively about getting l…”
Somerville: Picking category winners in weak sectors yields poor growth-stage returns
“You can pick a winner in a bad category, and you can still really not do well if you're entering in at a growth phase. I think we've picked some companies that have proven to be the category leader, but if it's in an area like InsureTech, or areas of PropTech,…”
Somerville: Single 2021 Quarters Outpaced All 2022 VC Liquidity
“Twenty-twenty-one had quarters that exceeded all of twenty-twenty-two from a liquidity standpoint”
Somerville: Denominator effect forces LPs into secondaries to rebalance portfolios
“The denominator effect is effectively when you have both a public and a private book, the public side has gone down more significantly. The private side has come down, but not at the degree or the speed that you've seen the public side go down. And what you're…”