Capital Allocators – Inside the Institutional Investment Industry

Erik Brooks is the Co-Founder and Managing Partner of Ethos Capital, a middle-market private equity firm built to bring seasoned C-Suite operators into every aspect of the investment process. Erik's experience prior to founding Ethos in 2019 spanned privatizations in Eastern Europe, value investing at Baupost, and twenty years at Abry Partners. Our conversation covers Erik's path to private equity, lessons learned about risk, the importance of betting on people, and the evolution in his thinking that led to forming Ethos. We then cover Ethos' focus on durable business models, one-deal-a-year cadence, operating system to evaluate and improve companies, and an investment example that brings it all to life. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Josh Steiner is a polymath of the New York and D.C. power corridors across government, media, and finance, and co-author of From Mistakes to Meaning: Owning Your Past So It Doesn't Own You. Josh rose to national prominence as the youngest-ever Chief of Staff at the U.S. Treasury in the Clinton administration, where he made a high-profile mistake he unpacks in the book. He pivoted to finance as a media investment banker and co-founder of private equity firm Quadrangle Group in 2000, worked as an operator at Bloomberg in the 2010s, has served on Yale's Investment Committee for nearly a decade, and five years ago returned to private equity as co-founder of SSW Partners managing capital for a few families. Our conversation focuses on mistakes, quite a contrast from other discussions on the podcast. We kick it off with Josh's big mistake at Treasury and analyze the nature of mistakes and what happened to Josh. We then turn to his mistakes in investing across deals, managing an investment business, managing people, and serving on Investment Committees. We close with frameworks to avoid mistakes and with Josh turning the table on me to discuss an impactful mistake I made that I've never discussed before. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Sloane Payne and Dave Joerger are the COO and CCO of WCM Investment Management, a firm chronicled over the years for its remarkable culture and growth to $120 billion in assets under management. This special conversation was hosted by Scott MacDonald on our affiliate Investment Management Operations podcast. Their conversation describes WCM's culture in practice that includes hiring for character over credentials, trust as an operating principle, overtrusting before proof exists, generous compensation and shared equity, values as a daily practice, connection through relational investment, making mistakes feel survivable, scaling culture by modeling behavior, accountability alongside kindness, and succession planning without financial burden. Sloane and Dave believe the atypical human blend of these disciplines has been the primary driver of the firm's success. Although not the origin of its name, it's perhaps not surprising that WCM also stands for Why Culture Matters. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Rodney Comegys is the CIO of Vanguard Capital Management and its Head of Global Equity Indexing, where he oversees $8.5 trillion in index assets across domestic, international, and multi-asset strategies. Rodney joined Vanguard twenty seven years ago and has worked across operations, customer service, risk management, and investing. Our conversation covers the philosophy and mechanics behind running one of the world's largest index fund operators. We discuss Vanguard's ownership structure, values, product selection, and mechanics of delivering an index fund. We then turn to common issues around indexing, including concentration in U.S. equities, corporate governance, private assets, and AI. Learn more about our Strategic Investments: Thema. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Randall Stutman is founder and co-head of the Leadership Practice at CRA. and the Admired Leadership Institute. Randall is probably the top executive coach that you've never heard of before. He's spent 30 years coaching and learning about the behaviors and routines of extraordinary leaders. To give you a sense, he was worked in the White House and the Olympics, with something like 2,000 senior executives and 400 CEOs, and in our world, the most senior executives at JPMorgan, Goldman Sachs, Morgan Stanley, and Blackstone. Randall is also well known among the titans in the hedge fund community, where he's worked with many of the industry's leading funds. And he's done all of this entirely by word of mouth referral. Randall was one of the first people I asked to come on the show three years ago, and he respectfully declined – at that point in time not wanting share the uncovered behaviors that drive his work. A few months ago, he and his partners launched Admired Leadership, an online course with short videos of 100 behaviors repeated by the most talented CEOs. The course is extraordinary. It's so ridiculously good that I started sharing a link to it in my email signature as a gift to those who don't know about it. Our conversation covers Randall's path to coaching and the coaching process. We cover behaviors common among hedge fund managers, the admired leadership course, and examples across inspiring others, decision making, time management, and elevating performance. We close with Randall's thoughts on behaviors that allocators can identify in their manager research. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Bruce MacDonald is the CEO and CIO of the Virginia Commonwealth University Investment Management Company, which runs $2.5 billion for VCU's endowment and health system. Bruce joined the University in 2015 and shortly thereafter, had the opportunity to sell the portfolio and start fresh. Since being promoted to CIO in 2022, VCU has been a top decile performer with a team of just five investment professionals. Our conversation covers Bruce's unconventional path from a religion major at Wesleyan to fixed income investing at Putnam and endowment roles at Columbia and UVIMCO before arriving at VCU. We discuss the principles of VCU's approach, including building a portfolio around secular tailwinds like India, Vietnam, gold, and artificial intelligence while maintaining abundant liquidity to act countercyclically during market dislocations. We explore VCU's team-based underwriting process, lessons learned from mistakes, and personal influences that have shaped Bruce's investment philosophy. Learn more about our Strategic Investments: Ascension. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Jeremy Grantham is the Co-Founder of GMO, a $100 billion Boston-based asset management firm co-founded in 1977. Over six decades in markets, Jeremy has been one of the most respected and outspoken voices on value, market bubbles, and long-term investing. He recently published The Making of a Permabear with Edward Chancellor, an account of his career and investment lessons learned along the way. Our conversation begins with Jeremy's early lessons in frugality growing up in wartime Yorkshire and his interest in numbers and investing. We trace his career through the founding of Batterymarch and GMO, the golden period of value, painful lessons of the dot-com bubble, and the challenges since. We cover Jeremy's framework for identifying and navigating market bubbles, career risk, and the current AI investment boom, and close with his essential philanthropic work to change the trajectory of the environment alongside the investment strategy he deploys in his Foundation. Learn more about our Strategic Investments: OWL. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Will Guidara is the author of Unreasonable Hospitality and the soon to release Unreasonable Hospitality: The Field Guide. Unreasonable Hospitality has become a New York Times bestseller and a business bible for elevating customer experiences. Will was co-owner of Eleven Madison Park alongside Danny Meyer when the restaurant ascended to #1 in the world, the co-producer of Emmy Award-winning streaming series The Bear, host of the Welcome Conference, and advisor to business leaders ranging from professional sports to financial services on the delivery of hospitality as a primary business strategy. Our conversation explores the operating principles of "unreasonable hospitality" across the identification and enhancement of customer experiences. Will describes operationalizing exceptional service, finding magic in repeated touchpoints, building teams that embrace hospitality, and leading others through vulnerability. Once in a while, I share a conversation outside of managers or allocators designed to help you level-up your performance and business. From the day I met Will several years ago, I knew he could do just that from his valuable insights and colorful stories. Learn more about our Strategic Investments: Ascension. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Katelin Holloway is a Founding Partner at Seven Seven Six, a technology-focused venture firm backing great early-stage entrepreneurs that she started with Alexis Ohanian in 2020. Alexis was a past guest on the show, and that conversation is replayed in the feed. Katelin and I explore the intersection of human capital and venture capital. We cover her upbringing, work alongside Steve Jobs at Pixar, and turnaround of Reddit with Alexis. We then turn to the application of her operational experience to venture investing. We discuss 776's sourcing and underwriting of founders, interviewing approach, investment selection, and scaling the highly personal approach it takes to add value to portfolio companies. Learn more about our Strategic Investments: Old Well Labs. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)

Gavin Baker is the Managing Partner and Chief Investment Officer of Atreides Management, which oversees $7 billion across public, private, and crossover strategies focused on technology and the consumer. Gavin's deep knowledge of semiconductors and AI may be second to none, but our conversation barely touches the space. We begin with Gavin's upbringing, intellectual curiosity, and path to investing, before turning to the beliefs that shape his approach. We explore his view that investing is a search for truth best pursued through debate, intellectual honesty, and a willingness to be wrong, and why people, culture, execution, and risk management matter more than investment process in driving long-term performance. We then turn to the application of those beliefs at Atreides, where Gavin emphasizes the importance of deep fundamental understanding, hypothesis-driven research, and culture that rewards constructive disagreement. We discuss how crossover investing can create informational and behavioral advantages - particularly in AI - and how portfolio construction in both hedge funds and venture capital can narrow the gap between insight and performance. As a disclaimer, I am both an LP and an advisor to Atreides, so I'm a little biased in my suspicion that you will really enjoy this conversation with Gavin Baker. Learn more about our Strategic Investments: Thema. Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠) All opinions expressed by Ted and podcast guests are solely their own opinions and do not reflect the opinion of Capital Allocators or their firms. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. It should not be construed as investment advice or a solicitation, recommendation, endorsement, or offering of any kind. Clients of Capital Allocators or podcast guests may maintain positions and securities discussed on this podcast. The statements and opinions contained herein may change at any time, based on market or other conditions.

Ed Grefenstette is the CIO of The Dietrich Foundation, which supports charitable organizations in Western Pennsylvania through a truly unique investment strategy that seeks to first, last, and always grow the assets. Bill Dietrich, a successful industrialist, published historian, international investor, and innovative philanthropist, formed the foundation after selling his business for $170 million in 1997. Since then, the pool has grown 11.5x to $1.5 billion after distributing $400 million to supported charities, including contributions that make it among the largest donors every year to Carnegie Mellon University and the University of Pittsburgh. Over the last twenty years, the Dietrich Foundation's performance sits at the very top of all endowments and foundations. Our conversation covers Ed's journey to investing and mentorship by Bill Dietrich, which led to him taking the helm at the Foundation in 2007. We discuss the Foundation's bold approach to illiquid investments, with 90% of assets invested in venture capital and private equity, its governance structure, and its thematic focus on innovation and emerging markets. Along the way, Ed shares insights into managing liquidity, constructing the portfolio, selecting managers, and navigating geopolitical risk to maintain conviction in an uncomfortably different strategy. Ed's approach and results will open your aperture to what's possible in an institutional portfolio with the right goals, structure, and governance in place. Learn More Follow Ted on Twitter at @tseides or LinkedIn Subscribe to the mailing list Access Transcript with Premium Membership Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In a world dominated by short-termism, does it seem odd that private equity holding periods are getting longer? Private equity professionals don't have different genes than other investors. They face a structural problem: too many portfolio companies cannot find a buyer. Private equity-owned businesses continue to grow in number and size, but demand from IPOs and strategics has not – and likely will not – keep up. This means that more companies will have to remain within the private equity ecosystem. The end of the private equity bottleneck is not in sight. Instead, the industry may be heading toward structural change. In this WTT – Can Private Markets Normalize, I pose the question of whether private equity will ever be able recycle capital fast enough to support successive fundraises without strain. The answer, I'm afraid, is no. Read Ted's blog here. Editing and post-production work for this episode was provided by The Podcast Consultant (⁠https://thepodcastconsultant.com⁠)