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 32 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
Martin: Smaller endowments must be price takers rather than negotiating fund terms
“We are not price negotiators. I spent a lot of time at Yale Working on LPAs and negotiating terms, we were going to be a price taker. So it was sort of a take it or leave it decision when we found managers we liked rather than, I mean, and yes, we like to say …”
Martin: Bankers enter investment management with deeper capital markets knowledge
“What you bring with you is a much deeper knowledge of the capital markets than many people in investment management. I think there's a greater understanding of how does equity formation work over the life of a company?”
Martin: Bias against bombastic managers probably favors the endowment
“There's lots of opportunities, so it's, I think it's okay, and I don't have any facts to prove this, but I think the bias is probably in our favor on that one.”
Martin: Building an endowment VC portfolio requires preexisting network access
“That is one thing I wouldn't do if I hadn't come from Yale and brought venture capital relationships with me or come from Silicon Valley where I'd had the network. It would be really hard to build it otherwise.”
Martin: Settling for Lower-Conviction Managers in China Resulted in Failure
“In China, for example, we're seeing some really interesting managers, but if you go back eight years ago, I think they were fewer and farther between, and we settled a couple times to get the exposure and to get some learning under our belt, and, you know, in …”
Martin: Allocators are three funds deep before knowing if emerging VC succeeds
“Because venture has such a long feedback loop, that you're going to be on the third fund before you really even know, and that gets back to, like, how are you going to size if you do decide to do some emerging manager? How do you size it so that you're not, wh…”
Martin: The Oil and Gas Industry is Structurally Ugly for Investors
“And yet, if you look at the industry as a whole, it's pretty structurally ugly, right? Because it's a commodity business. There's all sorts of ways to destroy capital. Capital allocation decisions are hugely important. There's so much volatility around the com…”
Martin: Wesleyan eliminated its dedicated oil and gas allocation target
“Well, I think one thing we've done is gotten rid of the target for oil and gas, which doesn't mean we can't do it. We can, and we have some managers we really like that we think hit the hurdle, but they have to compete against the rest of portfolio, and they h…”
Martin Refuses Meetings for Factor Risk and Smart Beta Products
“One of the ways we do that is we don't go to any conferences. Another way we do that is we don't meet with any firms that are trying to sell us, you know, factor risk or smart beta or any of those things”
Martin: Unable to Develop Conviction in Machine-Based Investment Strategies
“I don't know how to get conviction in something that's machine based.”
Martin: Reading Daily News Distorts Reality Too Much for Long-Term Investors
“I'm not a big believer that I really need to read the news every day. It's kind of distorting. It distorts reality too much.”
Martin: Bankers Must Abandon Transactional Mindsets for Investment Management
“The first thing you have to leave behind is your transactional mindset, because when you're in investment banking, it's all about the next deal, your fee generating, and that's how you get paid. So doing the next deal is sort of what you live for. When you get…”
Martin: Texas Oil Drillers Rival Silicon Valley Founders in Entrepreneurial Spirit
“I often joke that I worked on the two parts of the portfolio with the most entrepreneurial people in the world. If you think Silicon Valley entrepreneurs are entrepreneurial, go meet the people in Texas that are drilling for oil.”
Martin: Repeated non-lead deals reveal a venture firm's fading access
“Interpreting if a manager is in your conference room and you're saying, tell me about these five deals and, you know, to ask, were you the lead? Were you the lead? Were you the lead? No, no, no. And you start to realize, okay, this manager has fallen from a pl…”
Martin: Institutional Allocators Do Not Need to Participate in Every Good Deal
“Tim Sullivan used to say this thing, which has really stuck with me, and I repeat it often, which is, you don't have to do every good deal. Just every deal that you do has to be good. And so you have to be not afraid to miss something good. So you're really pl…”
Martin: Allocators Should Avoid Investing With Managers They Wouldn't Dine With
“If you don't want to go to dinner with them, I often tell my group this now, if you don't want to go to dinner with them, let's not invest with them. Because you're not really investing for the good times, you're investing for the really terrible times when yo…”
Martin: Managers must be articulate enough to reveal their thinking
“I don't really have to like the person, but I have to respect them enough, and I have to be able to have a conversation with them, and they have to be interesting enough and articulate enough to help me get inside their mind.”
Wesleyan Endowment Was Non-Compliant with Decades-Old Policies When Martin Arrived
“There was one person there with some institutional memory. There were a lot of Excel spreadsheets with our historical performance, none of which I was certain didn't have fat finger errors in them. And there was a portfolio with 26 managers in it. And there wa…”
Martin: Allocators Must Triple-Check Diligence When Top Endowment Peers Pass
“If you find somebody you like and no other great investors are investing alongside you, I think you have to ask yourself, like, am I that much smarter than all these people at Yale who have been doing this for 20 years or at Princeton or at Stanford? Like, why…”
Martin: Generalist allocator teams better evaluate cross-asset comparative risk-return
“I think what's great about the generalist model is everybody thinks about the comparative risk return of any investment, and that's super helpful. So somebody looking at real estate will be able to say this real estate manager is really interesting, but it's m…”
Martin: Specialist allocator models work better for larger pools backing spin-outs
“If you have a lot of money to put to work, and you want to invest with entrepreneurial firms. You need more of them. And so you really need to know what's going on. Who's spinning out all the time. You need to be there day one. The specialist model works bette…”
Martin: Small Endowments Have Capital for Niche Investments But Lack Staff
“Great paradox of the small endowment is that we have the capital base to do really interesting things, but we don't have the people in terms of resources on your team.”
Martin: Wesleyan deliberately excludes mining and non-US real estate investments
“So right off the bat, we said, look, we're not going to do any mining. We're not going to do any real estate outside of the US. We're not going to go to these parts of the world. It doesn't matter if that's in the index. We're just not doing it.”
Martin: Wesleyan prefers high-confidence 12% returns over uncertain 16-17% returns
“But I would rather have a high confidence, 12% return than a really not high confidence, 16% return or 17% return.”
Martin: Inability to Clearly Explain Strategy or Do Mental Math Exposes Managers
“People aren't clear about what they're doing. They can't really articulate it for you. If it's a complex area, they can't put it in terms that you understand. Too much jargon. Math. Can't do math in their heads. Things like that.”
Martin: Focus on Gross Returns is Problematic Because Institutions Spend Net Returns
“Yeah, you know what really bothers me in the investment world is when people talk about gross returns versus net returns. That's a pet peeve. We can't spend gross returns.”
Martin: San Francisco Network Provided Crucial Diligence for Yale Venture Underwriting
“Because I was in emerging growth technology, there was a whole network of people that I knew from my nine years in San Francisco that were venture capitalists, growth equity investors, CEOs, and that provided a really nice database for me when underwriting new…”
Martin: Wesleyan's $200M debt prevented endowment from matching Yale's illiquidity
“We had about two hundred million dollars of debt outstanding at the university when I came on a five hundred million dollar endowment pool. So we knew we could not generate liquidity by going back out to the capital market. So we had to generate all our liquid…”
Martin: Wesleyan raised its illiquidity ceiling from 35% to 42%
“So when I started, it was about 35% we set as a ceiling, and now it's up to 42%. But we've had to do that gradually over time, and at a billion, we've got more room to do that.”
Martin: Wesleyan Will Always Hold a Larger Public Equity Portfolio Than Yale
“We have a much larger public equity portfolio than Yale does, and we probably always will.”