Capital Allocators Annual Letter 2023
What if we gathered all our podcast guests in the same room? What if we removed the typical constraints of industry gatherings: no panels, no pitching, no speed dating? What if we just let them talk to each other, share ideas, and build relationships?
That’s what we did this year at the first Capital Allocators CIO Summit!
Our guests gave an epic response:
“It was the best conference I’ve been to, and I’ve been to way too many. You better invite me back next year.” – Ian Charles, Co-Managing Partner and Founder, Arctos Partners
“The event was remarkable and totally unique.” – Stefan Strein, CIO, Cleveland Clinic
This year was the most exciting yet for Capital Allocators. We launched Summits, created more content than ever, and started a new investment advisory boutique.
I’d like to take you on a behind-the-scenes tour of our gatherings, podcasts, and investing activities.
We hosted two Summits and two University cohorts that brought the community together to connect and learn.
Capital Allocators Summits – I Think We’ve Got Something
Our inaugural CIO Summit in April was an overwhelming success. We invited CIOs across allocator and manager organizations to meet in small groups and discuss topics of interest. Every guest gained insights, strengthened old ties, and made new ones.
We hosted a second Summit in September, and that one was also great. In 2024 we’ll host three Summits: spring for CIOs, summer for public market leaders, and fall for private market leaders.
We extend Summit invitations to people we know and follow a strict “no assholes” policy. But there are many outstanding managers and allocators we haven’t met. So if you’re interested in joining us at future Summits, please apply.
Hank, Morgan, and I couldn’t pull this off by ourselves, so we partnered with our friends Rahul Moodgal from Parvus; Jen Prosek, Katie O’Reilly, Jackie Dorman and the team at Prosek Partners; Ron Biscardi, Kaitlin Malin, Anne Iyer, and the team at iConnections; and Matt Spielman and the team at Inflection Point Partners. We’re incredibly grateful for their help in creating the Capital Allocators Summits.
Capital Allocators University – Something for Everyone
We hosted two gatherings for allocators not yet in leadership seats to learn new frameworks, network with each other, and ask questions of leading CIOs at Capital Allocators University.
We’ll host two more of these in-person, one-day events next year. Allocators with 5-15 years of experience can join our next cohort on February 22nd in New York City. Please register here.
We want to do more to help the industry connect and learn in between our gatherings. In 2024 we’re partnering with an organization experienced in community building to experiment with a new idea. More to come!
Content Keeps Rocking
We produce three podcasts, Capital Allocators, Private Equity Deals, and Investment Management Operations, and I write an investing blog. 2023 was the busiest year yet for all four.
Capital Allocators is the hub of our flywheel. It launched in April 2017 and this year reached 94,000 followers, averaged 100,000 weekly downloads, and crossed the 18 million download mark.
DealCloud named Private Equity Deals the top podcast for dealmakers this year. We released Seasons 2 and 3 on familiar companies and middle-market deals, respectively. Next September I’ll publish my third book, aptly named Private Equity Deals. It’s a set of case studies across strategies, firms, and industries selected from the podcast.
Investment Management Operations focuses on the behind-the-scenes professionals who set the stage for investment excellence. Hank came up with the idea, and when experienced COO Scott MacDonald reached out earlier this year, they decided to run with it. Scott hosts our newest show, which has gained loyal listeners across the industry.
My blog, What Ted’s Thinking, explores investment ideas. What topped the leaderboard for engagement this year? Posts on the Yale Model, NAV Loans, Active Management of Public Equities, Fraud, and Uncertainty.
The Podcast Business
A friend told me there are two types of entrepreneurs: those who find a business idea and those whose business idea finds them. I fell into the latter camp.
When I first started talking with friends and publishing the conversations, I didn’t think it was a viable business. It reminded me of an old Saturday Night Live skit about a bank whose sole mission was to give exact change. When asked how it made money, an employee says, “The answer is simple: volume.” Charging nothing for a product and making it up in volume felt like a shaky business model.
I was wrong. It turns out that advertisers, sponsored guests, and listeners are keen to engage with our valuable audience. Our first backer was Melanie Pickett from Northern Trust. She called a few years ago and asked if we accepted advertisers. I said, “Why yes, we do.” Since then, advertisers have leveraged our brand and shared their products on the show. Ten companies advertised this year, led by Northern Trust, Janus Henderson Investors, and 10 East.
Our second revenue source is Sponsored Insights. Some investment managers pay to appear on the show and share their perspectives and opportunities. We screen requests for quality – only one in ten applications made the cut for the sixteen Sponsored Insights on Capital Allocators in 2023. Sponsors consistently have given exceptional feedback. One manager told us that the podcast had the highest ROI of any marketing spend they had made in the firm’s history. That’s the kind of win-win we strive for. We’ve already filled half the capacity for Sponsored Insights in 2024.
Our third and broadest revenue source is the listener community. Listeners support the business through Individual and Corporate Premium memberships. Premium members receive our library of over four hundred transcripts and a series of other benefits. Corporate Premium members subscribe to company plans that provide everyone in their firm access. The list of these investment organizations is available at Corporate Members.
We will enhance the Premium transcript offering next year with both a keyword search and an AI-powered Chatbot, affectionally called ChatGPTed.
I manage my personal portfolio and advise several managers and allocators. Premium members receive a quarterly transparency report listing my investments and advisory relationships.
Capital Allocators Advisory –Rahul and Ted’s Excellent Adventure, Part Two
Rahul and I formed Capital Allocators Advisory this year to team up and provide strategic advice to managers. We invest in their funds and support them wherever needed. Our first relationship is with Gavin Baker from Atreides Management. Gavin is passionate, insightful, and driven to succeed the right way. He founded Atreides five years ago to invest in public and private technology and consumer companies. Today the team manages $3.5 billion.
Our mission is to Learn, Share, and Implement the Process of Premier Investors by Compounding Knowledge and Relationships with Institutional Investors.
I described our goals for 2023 in last year’s letter:
- Make the podcast better than ever and share valuable content with the institutional community.
- Create Summits and CAU experiences that leave attendees thirsting for more.
- Engage deeply in the community with ideas and investments.
I’m happy to report that we did all three. Let’s take a moment to celebrate!
We’ve established the following objectives for Capital Allocators in 2024:
- Create unparalleled experiences gathering investors and managers.
- Learn and share creatively through podcasts and writing.
- Build valuable tools for Premium members to research our library of content.
We’re searching for a college senior or recent graduate to join our team. If you know someone interested in investing and financial media that could be a fit for our two-year program, please share this job description.
I’m grateful for our community of listeners, supporters, and partners as we evolve and grow Capital Allocators.
Thank you for joining our pursuit of compounding knowledge and relationships.
 Weekly downloads across platforms and followers on Apple and Spotify.
 Spot 1: https://www.youtube.com/watch?v=CXDxNCzUspM. Spot 2: https://www.youtube.com/watch?v=KodqIPMbyUg. The skit is from 1988, long before the advent of electronic payments.
 The reference to the fine feature film Bill and Ted’s Excellent Adventure (1989) may be dated at this point, but it’s still a gem.