It was a pleasure to welcome our friend and collaborator, Marcus Whitney back to the Hedgeye studios on Wednesday. The discussion was, as Keith McCullough would say, timely and topical. We are all wondering when private investments will get repriced and the full effects of the drawdown of 2022 are known. Since venture is a big space, the impacts are not going to be uniform. Marcus takes us through that and more. It is a conversation you should not miss.
Link to replay is here.
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0:00 - 1:42 Introduction 1.43 - 6:38 Allocation of capital in free money era; mega funds, LP agreements for private investing; Tiger Global, D1 and upending "market" for term sheets; valuations and creating an index. 6:38 - 11:19 Changes in incentives 2020-2022; avoiding returning money to LPs, competitive pressures and mistakes made; health care avoiding much of the carnage. 11:19 - 15:11 Implications of a shift in the ratio between private and public investments; how much you gave into FOMO; what happens when the capital dries up. 15:11 - 18:33 Why seed investing must be more disciplined; mega funds marking up their own book, "this is bad." 18:34 - 21:54 Power of the LPs especially endowments, pensions; broadening market for LPs. 21:54 - 25:08 Timing of markdowns significant lag on information. Catalyst is rear view analysis from Cambridge Associates, Pitchbook and Crunchbase. When it is reported it will already have happened; the markdown is happening now; watch October reports 25:08 - 29:08 Diversification the single most underappreciated reality of venture. 29:08 - 34:13 The enormous opportunities for innovation and investment in health care |
Let me know if you have any questions.
Emily Evans
Managing Director – Health Policy
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