Assertion Supported
Ripley: VC vintages since 2018 have generated more pedestrian returns
“Since 2018, venture vintages have been more pedestrian in nature. Returns have not been what they were in the preceding years.”
Insight
Ripley: LP-GP alignment peaks during a sponsor's Fund I era
“You're never more aligned with a sponsor than you are in that fund one era when they want to have that stamp.”
Insight
Ripley: Early hedge fund backers secure founder discounts and liquidity control
“Some of the benefits that we see, one is you're generally gonna get better economics, so there's gonna be some form of founder class shares that you can participate in, whether that's a fee or a carry discount or both, both of those are available. Generally, y…”
Insight
Ripley: Manager growth and IR intermediation make scaling capital allocations harder
“We find that as these managers grow, they hire an hour person, suddenly you're being intermediated. You're not getting the same perspective. You're not able to read the temperament of the manager, understand what they're thinking about. It becomes more difficu…”
Insight
Ripley: Good endowment investing starts with an emerging manager program
“Any good endowment style investing starts with a good emerging manager program, including on the public side.”
Insight
Ripley: Hedge fund investing is an apprenticeship business learned at top firms
“In almost all the cases, though, it's an apprenticeship business where you've trained at a good firm. You've been shown what good looks like from a research perspective, and most importantly, from a portfolio management perspective.”
Insight
Ripley: Multi-manager pod shops do not suit emerging managers
“Some of the pods don't really lend themselves to emerging managers. They're really scale games where technology and systems and access are more important.”
Insight
Ripley: Retail meme trading makes short-side alpha much harder to generate
“We're living through another era now where meme stocks are going to the moon, and so the more short of the stock, the more it's being put up on Reddit and Robin Hood and places like that. That game has gotten a lot harder over time, and so we're looking for fo…”
Disclosure
Ripley: GEM Allocates to Concentrated Long-Only Managers Holding 5 to 25 Stocks
“And most of the long only managers that we invest with are going to have a fairly concentrated portfolio of fundamentally driven investment decisions. Call it maybe as low as five or six and up to maybe 20 or 25 kind of thing.”
Insight
Ripley: Sector Selection in Real Estate Outweighed Individual REIT Picking
“If you looked at public markets to make this a simple comparison, the decision to invest in data centers over retail real estate was dramatically more impactful than the decision of which REIT you bought within that structure.”
Disclosure
Ripley: GEM Has Recently Reduced New Software Buyout Allocations
“And even within buyout, we were adding software for a long time. We've been doing a little less than that recently.”
Assertion Not checkable as stated
Ripley: Most Original OCIO Firms Pivoted Models or Sold Out
“If you look at the original class of OCIOs that was created, most have either pivoted their model to something else, sold themselves, or both.”
Insight
Ripley: Willingness to walk away from deals strongly correlates with sponsor success
“Demonstrating a willingness to walk away from deals, we find it correlates very strongly with long-term success of a sponsor.”
Disclosure
Ripley: Most independent sponsors GEM backs pair with past operators
“Most of the independent sponsors we back are paired up with an operator they worked with previously.”
Assertion Supported
Ripley: 15% of VC funds generate roughly 80% of industry returns
“It's a power law business. Eighty-ish percent of the gains come from 15% of the funds.”
Disclosure
Ripley: GEM allocates roughly 60% to buyouts and 40% to venture
“In most portfolios for our clients, we're 60% buyout, 40% venture, roughly speaking.”
Assertion Not checkable as stated
Ripley: GEM receives three to four spinouts per week
“We're at a point where we're seeing three or four spin outs a week that people, Hey, I'm leaving good for a max. I'd love to talk to you, et cetera.”
Disclosure
Ripley: GEM evaluates AI tools to detect upcoming manager spinouts
“Caroline Dallas, who leads our sourcing, has been looking at different AI tools so she can surveil and understand signals of when someone might spin out so we can prepare ourselves even sooner.”
