Happy Friday, allocators!
Last month, The Allocator broke the news of Roger Vincent’s exit from Cornell University, where he overhauled the endowment’s private equity program into a portfolio that returned more than 20% annualized over his 12-year tenure. This week, he gives us the scoop on his next project: bringing endowment-style PE results to investors without an endowment investment office.
“I wanted to create the same experience that Cornell had in terms of manager access and selection, but do it for other investors,” Vincent said. “It shouldn’t just be the purview of the largest, most sophisticated endowments to access private equity in a meaningful way.”
Vincent’s solution: Summation Capital, a new twist on the fund-of-funds model that only charges performance fees on returns over the public market benchmarks.
“An idea I took from the endowment world is that we want to be held responsible for producing great performance,” he said. “What makes Summation unique is we’re willing to put our money where our mouth is.”
It’s also a mark of Vincent’s continued confidence in private equity, despite recent slowdowns in dealmaking and exits and an ever-mounting pile of dry powder.
“We believe on average private equity will outperform, but whether it does or not, good access, good manager selection, and good diversification” — across markets, industries, geographic locations, and vintage years — “can ensure outperformance regardless,” he said.
One could argue that “good access” is only a source of alpha because it’s a finite resource — that manager selection is a competition, and not everyone can win. But that’s not how Vincent sees it.
“I do not view it as a fixed pie,” he said. “We can all do well together. There are an unimaginable number of ways to get high-quality private equity returns, and we did incredibly well at Cornell with many managers that were easy to access. And we were happy to share, because that’s one of the ways to build a good partnership with your GPs.”
Through Summation, Vincent and his team are providing portfolio construction, diversification, and “what we hope will be top-tier manager selection,” he said, investing in primary venture capital, growth equity, and buyout funds — and co-investing alongside them. The core team is in place — including Dan Fordyce, who previously worked with Vincent as an analyst at Cornell and is responsible for manager underwriting, and Quinn Sarda, who joined from Charles River Ventures and oversees investor relations — and will continue to expand over time. Vincent said Summation has so far raised capital from “a number of very sophisticated” family offices and has begun investing. “We think the strategy is scalable, but we are already large enough to be a meaningful LP to the GPs we want to partner with now,” he said.
“Private equity remains by far the best asset class, and endowments have led the way in terms of emphasizing it within their portfolios,” Vincent added. “Being at Cornell was terrific — it has a great private equity program in place and a great team. This is my opportunity to be useful beyond that.”
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