I spoke on a panel at a wealth manager conference last week and the moderator asked me what the greatest opportunity for investors will be as we look ahead to 2024.
My answer was venture capital.
It might be the only time investing in venture capital came up at the conference. It’s been well documented that the over-exuberance of 2018 through 2021 flooded the ecosystem and drove outrageous evaluations. You’re seeing the fallout continue to drive headlines that imply venture is declining as an asset class. More markdowns are still to come, but that’s money that’s already been put to work.
Entry valuations are becoming much more attractive versus the past several years. Funds that were deploying aggressively in the low-rate environment, especially into later-stage ventures, will continue to see markdowns in their portfolios. However, capital being deployed now and in the near future is being put to work in a rationalized market with right-sized valuations, which we believe will drive outsized returns for investors in current fund vintages.
Many of the strongest performers in the asset class have been emerging fund managers with a differentiated strategy and sector specialization. They are experienced in their industry, with standout investing experience at a more established manager or operational experience working in the space. These are often not large name-brand funds, and they are not the kind of funds available on legacy investment platforms like CAIS and iCapital.
We believe a portfolio that includes both large established funds and these smaller managers with a unique edge carries the highest probability of achieving top-quartile returns.
-Logan Henderson, Founder and CEO
Investment Opportunities
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Platform Update
We’re excited to announce the new Fund Activity view is now available in Gridline.
Members now have the ability to dive deeper into their Gridline investments and see the companies that their dollars are invested in. They can also toggle to see the portfolio companies for all Gridline products, many of which are still marked as open for investing.
Each company has a quick link to the company’s website, an industry or sector description, and which fund has invested in the company and at what stage.
This feature is just one more way we’re bringing an unparalleled level of performance detail & transparency to private market investing.
– Peter Bilali, VP Product