It was hard to miss the news over the last two weeks that Kim Kardashian is launching her own private equity firm, SKKY Partners, and is reportedly seeking to raise $1 billion. It is certainly not a novel concept for celebrities and cultural figures to try their hand at investing as they believe they can identify new companies and trends while generating publicity for their investments via social media and brand endorsements.
While there are many approaches to celebrity investing, one interesting component of Kardashian’s new venture is her partner, Jay Sammons, who previously ran the Carlyle Group’s global consumer, media and retail division. Partnering with a notable “traditional” institutional investor has proven to be an effective strategy for celebrity investing.
Marcy Venture Partners was launched when Jay-Z teamed up with Walden VC general partner Larry Marcus. Elevation Partners was formed with the combination of Bono, Roger McNamee from Silver Lake Partners, and Bret Pearlman from Blackstone. Steve Young launched HGGC with Greg Benson from Bain Capital and Rich Lawson from Huntsman Gay Capital. The list goes on, but these notable funds all have one common thread – leveraging top-tier institutional investors.
Rarely does the average investor have the ability to launch their own investment fund or work with such prominent allocators. We started Gridline to enable all investors to bring elite managers into their own portfolios, leveraging the investment discipline, operational excellence, and portfolio expertise of top-tier funds to generate outperformance for the rest of us.
Worth a Read
Guide to IRAs and Retirement Investing With Alternatives
Recent changes allow alternative investments to be held in an IRA, opening up a new world of investment opportunities for retirement savers. Read more.
The Impact of Rate Hikes on Private Markets
While they are subject to the same interest rate dynamics as public markets, there are a few ways in which private markets may be less impacted. Read more.
A Final Thought
As you may have heard, just over a year after raising at a $10 billion valuation, Figma is getting bought for twice that price by Adobe.
Michael Jackson (the venture capitalist) broke out the share price that investors initially paid to get into Figma:
- Index Ventures – $0.088
- Greylock – $0.199
- Kleiner Perkins – $0.332
- Sequoia – $1.098
- a16z – $4.619
Adobe is buying Figma for ~$40.20 per share.
Index Ventures, Greylock Partners and Kleiner Perkins all own percentage stakes in the double-digits and will each return over $1 billion. Even investors in the recent 2021 round will double their money.
While 2022 may be saturated with market volatility headlines, this deal is a good reminder that industries will continue to pursue innovation, creating tremendous potential for investors that allocate a portion of their portfolio to a diverse set of top-tier VC fund managers who invest early in a company’s value creating innovation cycles.
Let us know what you think – please don’t hesitate to reach out.
-The Team at Gridline