E22: Alex Edelson of Slipstream on The 4 Sources of Alpha for Emerging Managers

Alex Edelson of Slipstream Investors, sits down with David Weisburd and Erik Torenberg to discuss the four sources of alpha for emerging managers (Sourcing, Picking, Winning, and Value-Add).

We’re proudly sponsored by Bidav Insurance Group, visit lux-str.com if you’re ready to level up your insurance plans.

(0:00) Introduction and characteristics of a good LP (0:50) Introduction of Alex Edelson (1:14) Overview of Slipstream's fund strategy and key factors in diligencing managers (6:03) Detailed diligence process and red flags for emerging managers (9:37) Challenges for emerging managers and institutionalizing courage (12:11) Sponsor: Bidav Insurance Group (13:07) Advising family offices and strategy behind Slipstream's concentrated portfolio (17:44) LP and GP relationship dynamics and special economics (21:38) Generalist versus specialist funds and the importance of sourcing (27:44) Building relationships for deal flow and winning deals in competitive rounds (33:03) The balance of fundraising and investing skills (35:00) Capital constraints, fund size, and alpha generation (38:21) Lessons from early stage fund successes and key learnings (43:16) Value addition by VCs, portfolio construction, and follow-on strategies (47:27) The difference between a good LP and a great LP (49:16) Strategic use of reserves and preserving ownership (56:40) Penalties for GPs and final thoughts on Slipstream's goals (58:07) Personal reflections and appreciation