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Animal Spirits Podcast

Talk Your Book: Alt Goes Mainstream with Michael Sidgmore

Aug 24, 2024
Michael Sidgmore, Partner and Co-Founder of Broadhaven Ventures, dives into the evolving world of alternative investments, highlighting their shift from institutional to individual accessibility. He discusses the rise of evergreen structure funds, allowing for better liquidity and compounding. The conversation touches on the impact of large firms like Blackstone and the competitive landscape between traditional banks and private credit. Sidgmore stresses the crucial need for financial advisors to educate clients on these investment opportunities and the complexities of private markets.
51:16

Episode guests

Podcast summary created with Snipd AI

Quick takeaways

  • Alternative investments are becoming more accessible to retail investors, shifting from institutional exclusivity to widespread opportunities for wealth managers.
  • The performance landscape of private equity shows significant discrepancies, necessitating careful evaluation by investors due to the narrower returns among larger firms.

Deep dives

The Evolution of Alternative Investments

Alternative investments have transitioned from being primarily available to institutional investors, such as pensions and endowments, to becoming more accessible to individual wealth managers and retail investors. This shift is part of a broader trend where the total assets in the wealth channel, which is approximately $145 trillion, have seen minimal allocations to private markets, typically around 2-4 percent. In contrast, large institutions have significantly higher allocations, often seeing 20-30 percent dedicated to alternatives like private equity and real estate. The expanding infrastructure from platforms such as iCapital is driving this evolution, enabling wealth managers to offer similar opportunities to their clients as those historically available only to institutional investors.

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