The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

20VC: Why Now is the Best Time to Invest in Emerging Managers, Biggest Mistake Emerging Managers Make When Fundraising & Investing Lessons from Investing $1.5BN Per Year and Being Early Investors in Thrive, a16z and Founders Fund with Peter Lacaillade

27 snips

Dec 18, 2023

Peter Lacaillade, Managing Director at SCS Financial Services, shares his insights on the evolving landscape of venture capital. He believes now is an ideal moment to invest in emerging managers for superior returns. Lacaillade discusses common traits of successful VCs and the importance of building strong relationships with LPs. He also unveils his barbell portfolio strategy, balancing investments between established franchises and new players. Throughout, he reflects on lessons learned from past mistakes and the critical dynamics of fund management.

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ANECDOTE

Peter's Entry into Venture

Peter Lacaillade entered venture capital as an LP at SCS Financial in 2011.
He had prior experience in investment banking and private equity at HarbourVest Partners.

INSIGHT

Market Timing

2011 was an opportune time to enter the LP world due to the GFC aftermath.
Many general partners were receptive to meetings and allocations.

ADVICE

Off-List References

Seek out off-list references when evaluating fund managers.
On-list references often lack critical insights.

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Peter Lacaillade is a Managing Director @ SCS Financial Services where he leads its private investment program where he oversees the firm’s activities in private equity, opportunistic credit and private real assets. Peter has been an early backer of Thrive, Founders Fund, a16z, Greenoaks and 20VC. Before SCS, Peter was an Associate at HarbourVest Partners in its Secondary Group where he analyzed venture capital, growth equity and buyout investments.

In Today's Episode with Peter Lacaillade We Discuss:

1. Becoming One of the Great LPs in Venture:

How did Peter make his way into the world of fund investing as an LP?
What does Peter know now that he wishes he had known when he started as an LP?
Why does Peter believe now is the best time to be investing in newer, emerging managers?

2. How to Pick the Best Venture Managers:

What are the commonalities in the best VCs Peter has invested in?
How important is track record for Peter when evaluating managers?
What mistakes has Peter made when it comes to manager selection? What did he learn?
How do the best managers build relationships with their LPs?

3. Building a Portfolio That Can 5x:

In a venture fund portfolio, what is the distribution between those that outperform, perform as planned and then underperform?
How does Peter invest in both large franchises and emerging managers with a barbell approach? How much in established franchises and how much in emerging managers?
Are managers actively marking down their portfolios in the last 18 months? Who has been the best at this and who has been the worst? How much should portfolios be marked down?
How does Peter evaluate the compression of deployment timelines we saw in the last 18 months?

4. A Breakdown of the LP Landscape:

Family Offices: What are the biggest dangers of having family offices as LPs? Why do multi-family offices tend to be better?
Endowments: Are they really as stable as people think they are? What separates a good vs great endowment? Who stands out?
Fund of Funds: Why does Peter think fund of funds deserve more credit? How should managers think about working with FoFs most effectively?
What is the right level of concentration managers should have between these different LP profiles?
What are the biggest mistakes emerging managers make when approaching LPs?