January 12, 2023
Key Takeaways
1. Venture capital is an important driver of returns for leading endowments. Accessing venture capital managers that are likely to outperform takes time, networks, and expertise which create significant barriers to entry for individuals and small investors.
2. Investing on behalf of mission-driven organizations has resonated with the venture capital community. The top managers often have a stable group of existing investors, and are only willing to add new investors if they support values-aligned missions. At GEM, our clients are a key differentiating aspect in this regard and something we are proud the investment community recognizes.
3. Selection is critical. Top quartile venture capital firms have added at least 14% above the S&P 500®, but the median fund has beaten the S&P by merely 2%.
In this mid-year follow-up to our 2026 Outlook, we revisit the four themes shaping this year's markets—AI's debt-financed buildout, accelerating private market access, biotech's continued momentum, and a slowly healing real estate market—and take stock of what's playing out as anticipated and what isn’t.
Three years after our last Investment Policy review, the regime has shifted: higher rates, sticky inflation, and a positive stock-bond correlation. In this conversation, GEM’s CIO Matt Bank revisits not just capital market assumptions but the framework itself, from methodology to implementation and risk management.
The firm announced the final close of GEM Seed & Micro Venture Fund, LP. The Fund closed with $82 million in commitments—exceeding its hard cap and fundraising target—and marks GEM's first vehicle focused specifically on seed- and micro-stage venture capital.
Let’s start a conversation about how we can help.
