Insights
Our “Insights” seek to identify actionable investment themes and carefully articulate the logic behind why such themes are important and how they should evolve over time.
Makena 2023 Sustainability Report
Makena believes that identifying and advancing material factors related to environmental stewardship, social impact, and corporate governance can improve shareholder returns. Our sustainable investment framework starts with and is rooted in our fiduciary responsibility to deliver the highest risk-adjusted, long-term returns for our investors.
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Makena 2022 YE Marketables Letter
This letter addresses how we’ve responded to one of the most challenging investment environments of the last couple decades. We reflect and provide detail on our portfolio changes and dive into our Hedge Fund portfolio, which we are particularly excited given the current environment. We appreciate the relative recency and duration of this challenging period and are mindful of the temptation to overreact. While we will continue to adjust the portfolio as necessary, we remain excited about our manager roster and underlying portfolio as it stands today.
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Makena 2022 Sustainability Report
Makena believes that identifying and advancing material factors related to environmental stewardship, social impact, and corporate governance can improve shareholder returns. Our sustainable investment framework starts with and is rooted in our fiduciary responsibility to deliver the highest risk-adjusted, long-term returns for our investors.
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2021 Annual Letter
This letter reflects on this new regime and addresses how we are responding to these heightened risks and “changed facts,” while still adhering to our core principle of being a long-term investor. The bottom line: we still have no edge in predicting these macro and geopolitical events, but we’re concerned that the dispersion of market outcomes has increased and that the compensation for risk is lower than it was a couple of years ago. Therefore, we have dialed back our risk levels and are being more cautious about rebalancing, unlike our approach to managing the portfolio in the spring of 2020. We still like the balance in our portfolio, which will help us navigate both inflationary and low-growth disinflationary environments.
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Larry Kochard on Capital Allocators Podcast
Makena Capital Management’s Larry Kochard joined Ted Seides and the Capital Allocators podcast for an engaging conversation on his path from endowment professor to Chief Investment Officer. Larry also offered insight on Makena Capital Management’s long-term investment approach and how investing in alternative assets – along with sourcing, due diligence, and manager selection – is a core competitive advantage of the firm. Listen to the full podcast here.
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Brian Rodde Speaks with Chief Investment Officer on VC Investment Landscape
In an interview with Chief Investment Officer Magazine, our Co-Managing Partner Brian Rodde shared his insights on the venture capital investment landscape and takes the long-term view on the industry’s potential.
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Jonathan Van Gorp Speaks with Pensions & Investments on the Industrial Real Estate Sector
Makena Capital Management’s Jonathan Van Gorp recently spoke with Pensions & Investments on the industrial real estate sector and how new competitive dynamics are impacting asset owners and real estate managers.
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Coinvesting in Private Equity
With competition for compelling co-investment opportunities on the rise, Managing Director, Lara Banks outlines in the latest Makena Insight why our firm has been able to rise to the top of the pack.
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Larry Kochard Speaks with Chief Investment Officer on Alternative Asset Investing
Following an extraordinary year for the endowment model, Makena’s Larry Kochard pointed to the model’s long-term vision, ability to take on liquidity risk by allocating to alternatives and superior manager selection as keys to its success.
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Approaching Emerging Managers in Private Equity
Building relationships with emerging managers has been a fundamental tenet of our approach since inception. In this Makena Insight, Managing Director, Kia Ghorashi details the five key considerations that underpin our conviction for investing in and alongside emerging managers.
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How Large E&Fs Allocate to Privates
In this Makena Insight, Makena Managing Partner, Luke Proskine illustrates how the endowment model offers the unique ability to invest on a perpetual horizon, lean into inefficient asset classes and develop long-term relationships with top existing and emerging managers.
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Cryptocurrency & Blockchain
Cryptocurrencies continue to dominate the headlines, but less covered is the historic interest from institutional investors in the nascent asset class. In this Makena Insights video, Lara Banks takes the long-term view and outlines investment opportunities across blockchain technology, DeFi and crypto.
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Recent Outsized Returns in IPOs
Amid a banner year plus for IPOs, hedge funds are finding that the greatest returns can be found in the last rounds of fundraising as a private company, and aggressively investing in that strategy, according to Makena’s Jackson Garton.
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How the Pandemic has Changed Investing in PE
In this Makena Insight, Makena Managing Director Lara Banks discusses the key takeaway the pandemic offered to the firm’s buyouts team – continue to stick to your strengths.
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Navigating Inflation & Reflation Trade
Long-Term Risk Valuation: Ahead of the Jackson Hole Symposium, Makena CIO Larry Kochard discussed the optimal asset mix to help institutional portfolios navigate the twin guardrails of long-term inflation risk and valuation risk without reducing return potential.
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Makena 2021 Sustainability Report
Makena believes that identifying and advancing material factors related to environmental stewardship, social impact, and corporate governance can improve shareholder returns. Our sustainable investment framework starts with and is rooted in our fiduciary responsibility to deliver the highest risk-adjusted, long-term returns for our investors.
Read More
Larry Kochard Speaks with MarketWatch on Powell Re-Nomination
Makena’s Chief Investment Officer Larry Kochard shared his insights in MarketWatch on the trends driving markets ahead of Thanksgiving, and following President Biden’s re-nomination of Jerome Powell as Fed Chief and nomination of Lael Brainard to serve as Fed vice chairwoman.
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Larry Kochard Speaks with Pensions & Investments on Benchmarking Effectively
In a recent Pensions & Investments article, Makena Chief Investment Officer, Larry Kochard shares his thoughts on how when it comes to asset owners' private equity portfolios, there is "no silver bullet" to benchmarking private equity investments.
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Larry Kochard speaks with Barron’s on Endowment Returns
Makena’s Larry Kochard spoke with Barron’s about the factors contributing to this fiscal year’s high returns for university endowments. He shared, “The endowment model has taken a lot of pushback in the past decade, but this reinforces that you are going to see bigger returns if you are long-term-oriented.”
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Luke Proskine Speaks with Fundfire on Endowment Returns
In a conversation with @Fundfire, Makena’s @Luke Proskine offered insight on the key drivers of high returns for the OCIO and endowment industries over the last fiscal year, noting that “the endowments and foundations that do not see themselves getting the windfall of returns of their peers might re-think their investment programs.”
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Navigating the OCIO Spectrum
The last decade has seen tremendous growth in Outsourced CIO (“OCIO”) assets, from just $100 billion globally in 2007 to over $2 trillion today. However, the term “OCIO” is broad, at best. We have identified four key areas of differentiation among the OCIO industry. Within each area, there is a wide spectrum of offerings. This Makena Insight acts as a guide to navigating each area of differentiation. Understanding the breadth of offerings and how to assess them will help focus an institution’s OCIO search.
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Brian Rodde Speaks with Fundfire on Co-Investing
Co-investing is certainly on a hot streak – and is on pace to reach $187 billion in capital deployed this year – well above the five-year average. Makena’s Brian Rodde spoke to Fundfire on the drivers for the surge and the right way to quickly diligence and invest behind these opportunities.
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Brian Rodde in Fundfire Alts
In the latest edition of Fundfire Alts, Makena’s Brian Rodde offers insight on the benefits of allocating to long-dated private equity funds - “You can reduce the performance leakage in fees, carry and taxes by holding the same asset in the same structure and being able to leave your money invested for longer.”
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Larry Kochard on Emerging Markets
Spurred on by geopolitical changes including Brexit and rising tensions between the U.S. and China, asset managers and others argue that there’s a strong case now for investors to move away from simple index funds and adopt a more active securities-selection approach to emerging markets. Larry Kochard, Makena’s CIO, discusses how we capitalize on market inefficiencies in countries like Brazil, China, India, and Russia using active management.
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Luke Proskine Addresses OCIO Matchmaking
In a Pensions & Investments newspaper commentary, Luke Proskine, Co-Managing Partner at Makena Capital Management, LLC, addresses the four key questions that drive OCIO matchmaking and how Makena navigates the landscape.
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Brian Rodde in Buyouts
Many institutional investors paused private fund commitments during the uncertainty of the Great Financial Crisis – and learned the hard way not to miss the next opportunity to invest into a market recovery. This time around, private fundraising is busier than ever. Brian Rodde comments on the highly active 2021 fundraising landscape in this article from Buyouts.
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Larry Kochard in Investor’s Business Daily
As the possibility of an oncoming inflation surge looms, investors across the landscape are set on finding ways to beat rising prices if they do arrive. In this article from Investor’s Business Daily, CIO Larry Kochard offers a glance at Makena’s equity-focused approach, centered on high quality growth businesses.
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Calendar Year 2020 Marketables Investor Letter
In order to provide more regular and timely insights around our approach to the Public Equity, Hedge Funds, and Fixed Income asset classes, Makena is introducing a new semi-annual Marketables Investor Letter. This first edition outlines the implications of 2020’s market actions and reviews Makena’s approach to active management in Public Equity.
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Cryptocurrency & Blockchain
Cryptocurrency and blockchain technology have the potential to upend the financial system, the internet, and the very notion of a corporation. But does the hype around this rapidly expanding technology translate to practical investment themes? The latest Makena Insight outlines the multiple functions of blockchain technology as they relate to a well-balanced venture capital portfolio.
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Women in Private Equity – Privcap report
In Privcap’s interviews with senior professionals in the Private Equity industry, they share a conversation with Lara Banks, Managing Director of Makena Capital, about building a career in an industry that has a small but growing population of women in leadership positions.
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Makena 2020 ESG Report
By integrating ESG factors into our investment activities, we believe we can materially enhance financial and operating outcomes. Makena’s 2020 ESG Report examines our philosophy and process around ESG integration, and reviews the evolution of our approach over time.
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Rebalancing and The Equity Risk Premium
Market drawdowns throw portfolios out of balance and force investors to make difficult decisions around rebalancing. With COVID-19 as a backdrop, Makena’s latest insight examines the equity risk premium (“ERP”) through historical downturns as a guide for investors rebalancing into risk assets.
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Lara Banks – Named to WSJ’s Women to Watch
Congratulations to Lara Banks, Managing Director and Co-Head of Private Equity at Makena Capital for being named as a Woman to Watch in The Wall Street Journal Pro’s Private Equity Analyst November issue. The publication highlights Lara’s role sourcing and executing Makena’s investments in and alongside high-quality private equity and venture capital managers and her leadership of the firm’s ESG commitments.
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Mid-Year 2020 Letter
Makena’s Mid-Year Investor Letter provides a recap of the first six months of 2020, including market context and how Makena relied on its core investment beliefs to navigate the volatility. The letter also compares and contrasts “quality” and “value” as investors try to discern the true worth of a company beyond its tangible assets.
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Women in Private Capital
In Privcap Media’s recent podcast episode, Women in Private Capital: Mentorship and Career Support Matters, Lara Banks, a Managing Director at Makena Capital, talks about building a career in an industry that has a small but growing population of women in leadership positions.
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Makena Capital Looks for Inefficiencies in a Challenging Market
In the latest episode of The Privcap podcast, Makena’s own Luke Proskine and Lara Banks discussed how the endowment model and several of the firm’s long-term themes – from emerging managers, to early-stage venture capital, small-cap buyout and active management – are well positioned to capitalize on inefficiencies in today’s markets.
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Emerging Markets Update
In Makena’s latest insight on Emerging Markets, we dive into our differentiated strategy for EM equity investing, which utilizes a targeted, bottom-up approach to bypass the suboptimal exposure of the passive emerging markets options.
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2019 Annual Letter
In our 2019 Annual Letter, we discuss the most recent calendar year and 2020 to date, including how we have reacted to take advantage of investment opportunities.
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Coronavirus Response: Update
The coronavirus pandemic is expanding at a seemingly increasing velocity. We continue to monitor the situation and its implications closely. This is an update to our post from last week. We will continue with regular updates as the situation develops.
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Coronavirus Response: Remaining Disciplined
The coronavirus is a serious global event which we continue to monitor closely. Its impact on global markets is fluid, but we remain confident in our portfolio and its long-term orientation. Protecting our greatest asset – our people – is a top priority.
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Makena Capital ESG Report 2019
We believe the formal incorporation of ESG considerations into our investment activities sharpens our ability to identify potential risks and opportunities leading to attractive long-term risk-adjusted returns. As such, we feel it is imperative to partner with best-in-class managers whose objectives and culture are aligned with our own.
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The Little Engines Who Can: Why Small-Cap Buyout Can Drive Investor Returns
In our continual search to find the most attractive investments on behalf of our investors, we have naturally developed biases through our experience at Makena and through our experience as investors in prior roles. In the buyout asset class, we believe small-cap funds provide the strongest opportunity to generate alpha. Due to several factors, which we discuss in the letter, Makena is ideally positioned to source and partner with top investment talent in small-cap buyout.
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Emerging Manager Alpha
The investment community is acutely aware of which managers consistently perform in the top quartile, and achieving an allocation to their oversubscribed funds is difficult. Instead of asking “how do we access these top-quartile managers?” Makena chooses to ask the question “how do we find tomorrow’s top-quartile managers?” A discussion about why Makena targets these “emerging managers” and the success signals we have developed to identify them.
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The Endowment Model Revisited
The investment committees of endowments and foundations have long relied on portfolios of marketable stocks and bonds to deliver operating payouts while preserving purchasing power. That model has been increasingly threatened by lower forecasted returns across both stocks and bonds, forcing a difficult decision on investment committees: decrease payouts, or embrace illiquidity in the hunt for returns. In this letter, we examine the success of endowments and foundations who have increased their allocation to private asset classes.
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Staying the Course: Perspectives on Sticking to the Plan During Market Upheaval
The events of 2018 generated concern in investment performance and newspaper headlines alike; the worst year in equity markets since the GFC was intensified by constant reminders of geopolitical unease. In our latest Strategy Insights letter, we turn to two legends of passive investing to remind us that maintaining discipline in the face of hardship pays handsomely in the long term.
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Makena’s Six Core Investing Principles
Diligently adhering to these six principles ensures that we stick to our competitive edge: constructing high-quality portfolios that balance short-term risk and long-term risk by taking a bottom-up approach to asset allocation and seeking to partner with extraordinary investment managers.
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Makena Capital ESG Report 2018
We believe the formal incorporation of ESG considerations into our investment activities sharpens our ability to identify potential risks and opportunities leading to attractive long-term risk-adjusted returns. As such, we feel it is imperative to partner with best-in-class managers whose objectives and culture are aligned with our own.
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Europe: A Lost Decade Ahead?
The credit crunch under way now for five years in Europe may have already created permanent and irreversible damage to those economies. We ask the question: Is Europe on its way to a lost decade?
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The Road Ahead for China
The Chinese growth “miracle” is enabled by a series of policies that purposefully distort input markets in order to facilitate industrial development. In order to transition to a consumer-led economy, China needs to dismantle the distortions it put into place that led to the Chinese growth boom. That is a tall order.
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