E16: Beezer Clarkson on her new $1.4B Emerging Manager Fund with CalSTRS

Elizabeth "Beezer" Clarkson, Partner at Sapphire Partners, discusses how their new partnership with CalSTRS will allow them to expand their ability to support the next generation of VC managers – all while continuing to focus on investing in the established.

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(0:00) Introduction to Beezer Clarkson and discussion on fund graduation rates (0:25) Beezer Clarkson on the CalSTRS emerging managers program and its $1.4 billion initiative (1:59) Emerging vs. Established managers: Definitions and dynamics (4:01) The performance and significance of emerging managers in the industry (6:05) Challenges for new LPs and best practices in LP portfolio construction (10:17) Red flags and sustainable alpha in emerging managers' transition to established status (16:27) Sponsor: Tactyc (17:06) Evaluating emerging managers: Criteria and the solo GP phenomenon (24:03) Trends in spinouts, consolidation, and LP-fund manager relationships (28:05) CalSTRS strategy and the value adds LPs bring to fund managers (32:46) Systematic biases and current debates among LPs (36:04) The importance of exits and openness to alternative investment models (40:00) Key factors in LP evaluation of emerging managers and the role of listening (43:43) Transparency in the LP ecosystem and the evolving role of LPs (46:44) Zero sum thinking and streamlined agreements for emerging managers (51:57) Sapphire's approach to current industry challenges and lessons from past downturns (54:42) Episode conclusion and special RFP to the community