Minisode: The Endowment Model, LP Culture Fit & Surviving Venture Cycles

0:00Nick Chirls: It is wonderful to have the point of view that you want to look out 50 years. It is a wildly different thing to have the structure and the assets and the clients and the GP relationships to make that structurally possible. I feel that there's a lot of comfort in that because my North Star is always an LP needs to first and foremost be there in service of their GP and their clients. And so this kind of platform allows us to do that because you can't survive cycles if you don't.

0:39Beezer Clarkson: Thank you.

1:06Welcome back to the Origins Minisode. This is the podcast that dives deep into the business of venture capital, where we learn how the people behind the capital, both GPs and LPs, make decisions. I'm Nick Turles, GP at Asylum Venture.

1:20Nick Chirls: And I'm Beezer Clarkson. And in a bit of a first for the show, I am now joining as a member of the LGT Capital Partners team. As we discussed in the last episode, the Sapphire Partners investing team has joined this new platform, and we had Thomas Christensen, who is now one of my new colleagues, but an old friend, on our guest. So this mini-sode is a chance for Nick and I to unpack what we took away from that conversation and why it matters for the broader LP and GP ecosystem. ecosystem there's probably a lot of topics to cover i think maybe the more one interesting one which is maybe a little bit meta was just uh like seeing two new partners do it um they like almost reminded me of like uh a pitch meeting where we're meeting two co-founders like talking about how they got to know each other and why they started a company together so that was kind of fun to um to witness i'm curious like how much you guys did when talking through this and you guys talked a lot about like alignment and company cultures um like did you guys do the co-founder dating stuff that people do you know strength and weakness questionnaire thing that yeah yeah we did not like did you guys do any of that stuff as a team no i hope that means So then I guess maybe the question for you is like, how do you understand how the alignment of cultures actually works?

2:55Was it a feeling? Was it just knowing each other for a long time? Like curious what exactly?

3:00Nick Chirls: Yeah, no, it was a very unique experience and maybe not one that people should use because I do think there's a lot of value in the 50, I'm not sure it's 50 questions, but I've heard a number of GPs talk about writing down like, what are your code of ethics? What are your morals? What are your values? How do you feel about money, which is a very important question to ask allocators, your long-term career perspectives. I think because Thomas and I had known and worked together across LPAC tables and co-invested in similar funds for a long time. And when, even if we weren't in the same funds, routinely got together to discuss the ecosystem, we'd sort of done a lot of those questions.

3:41And we had just a number of shared data points of working together.

3:47Nick Chirls: So you didn't have to ask the question. You sort of knew the answer. And then when we were going through the discussions of how would this work and bringing our teams together to meet each other. And I went out and met with a number of senior officials at LGT Capital Partners. That process also was very educational. And I think, I don't know, Nick, if you've gone through different sort of joining forces with teams. I'm trying to think of the best words. The process itself is very educational because it's not simple, right? And when you go through things that aren't simple as far as discussions and different team members, and you have to ask a lot of questions about how things work and dollars are involved, you do see how people make decisions because they're acting with their feet.

4:32Nick Chirls: and in all of that it reinforced the messaging of these are people that have a similar culture and values and you didn't have to fill down a piece of paper you literally lived it every day in conversations i can tell you thomas is the most even-keeled person i know he would have a 20-hour day and he would call me at some ridiculous hour in the wee hours of the morning at 2 a.m because i don't know what something would come up that we'd want to discuss and he was always they're like oh there's a wrinkle let's discuss it are you okay which again from the people you can build a business with and and the team that he's built reflects that and the firm that he chose to be at reflects that so this is my answer to the no we didn't do the questions i think we just lived the questions interesting and i imagine you guys spend an extraordinary amount of time together working through all this stuff um takes a village yeah yeah um maybe another topic just to cover is uh because partly because it's timely is you know thomas did talk about the inevitable blip does that have an impact for how you maybe think about your world and like maybe does that change within the lgt environment well if we step far back venture always goes through cycles And you tell me, because you're the one who pointed out the four-year bull bear cycle in crypto, maybe venture is just now pulling in faster.

5:57Nick Chirls: You know, you've mentioned this, the speed of technology is much faster. So maybe the venture cycles are faster. So yes, will the world come down a bit? It just feels inevitable. No idea as to when, but, you know, I've been doing venture now since 2000. So yeah, goes up, goes down. it will come back down and it'll go back up and it'll come back down um what i do like about the lgt capital mark capital partners platform and thomas talked about this quite a bit is the long-term perspective and it's not just people say long-term perspective it is wonderful to have the point of view that you want to look out 50 years it is a wildly different thing to have the structure and the assets and the and the clients and the gp relationships to make that structurally possible.

6:43Nick Chirls: And I think there's, so for me, that gives me, it's exciting isn't the right word, but I feel that there's a lot of comfort in that because my North Star is always an LP needs to first and foremost be there in service of their GP and their clients. And so this kind of platform allows us to do that because you can't survive cycles if you don't, right? The same way I'm assuming it's similar for you, looking at your, like the GP sits with the LP and the founders. So we all have people on both sides and you just have to make sure you're, you can stand by them for that long. So I want to just bring up the endowment concept because it is such a core tenant in the US, right?

7:28Nick Chirls: Everywhere you go, people always talk about, oh, I want an endowment as an LP and the endowment model really popularized, right? David Swenson and his success investing the Yale endowment really popularized venture as an asset that endowments wanted. And Nick, I'm sorry, Thomas, you know, is referencing this royal family that started the endowment so long before then. And then as evolved the model and how they've done it. And as a venture geek, I just find this fascinating that you can take these different core concepts and apply them in different ways and what we learn from that as investors and how in this market, we all need to adapt a little bit.

8:10Nick Chirls: The core values haven't really changed, but how you adapt around the edges does. And intellectually, maybe I'm just the only person here, but I think that's fascinating and something that I'm personally really excited to spend more time on at LGT Capital Partners and dig into. Thanks for listening to The Origins Minisode, the show where we discuss the venture ecosystem through the lens of myself, a GP, and Beezer, an LP. Keep an eye out for more by following Nick and I, as well as OpenLP, because it's come with, on X and LinkedIn. I'm Beezer Clarkson. And I'm Nick Turles, and we'll be back soon.

8:43Thanks for listening.