Kayden: Post-dot-com and GFC downturns produced the best venture vintages
Joelle Kayden · Venture Capital Panel – Beezer Clarkson, Chris Douvos, and Joelle Kayden (Capital Allocators, EP.299) · Feb 27, 2023 · at 8:07
Joelle Kayden (Founder and Managing Director of Accolade Partners) explains historical institutional allocator psychology and returns after major tech market downturns.
0:00 / 0:14exact quote · 14.7s
720p mp4 · rendered on demand · StarZero watermark
“The last time we had a significant correction in venture post the collapse of the internet bubble and people stopped investing in venture, those ended up being the best vintages, particularly, you know, some of the investments that were made during the global financial crisis”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Joelle Kayden
Kayden: VC managers will face significant LP turnover after the boom
“You're going to see a lot of turnover in the LP base for managers broadly, as people see who really performed well, and what was a very promiscuous environment, and those people who stayed at the party too long”
Kayden: Later-stage venture is most vulnerable to market correction
“We don't tend to like larger funds, and we don't like later stage investing, largely because we think that is an area that is sort of more correlated to the public markets, you know, and an arbitrage opportunity, and so at a period of Massive, great inflation.…”
Kayden: Venture capitalists are painfully naive about their LP base
“I think venture capitalists are painfully naive about who is their investor base and putting themselves in the shoes of the LP and what some of the issues that the LP has when they go to their investment committee making recommendation”
Kayden: Venture debt is a disastrous idea for startups during downturns
“I philosophically think that debt on any venture company is a disastrous idea, particularly in times like this, because the banks are not going to be patient.”
Kayden: A leading endowment put 75% of VC allocation into three managers
“I was talking to a leading endowment yesterday that said that 75% of their venture allocation was to three managers. That's a problem. Well, it's to three managers, each of whom has eight underlying products, and I can tell you, Mathematically, that not all of…”
Kayden: Tiger Global and Coatue win via fast checks without board seats
“One, we've seen the emergence of firms that write checks really quickly and are extremely aggressive, whether it's Tiger Global, D-One, CO-Two, name your favorite firm. That's just a very different strategy. They don't take board seats, but they're extremely k…”