2020 Highlights 

GCM Grosvenor  2020 Small and Emerging Managers Conference

For the past 14 years, the Small and Emerging Managers (SEM) Conference has solidified its reputation as an essential event for small, emerging, and diverse managers and interested investors and consultants. This year, the conference rose to a new challenge of bringing together hundreds of industry participants in a virtual setting while maintaining the engaging environment that has been the event’s hallmark.

GCM Grosvenor met the challenge by using interactive technologies to seamlessly merge large group presentations with roundtable discussions and one-on-one interactions. As a result – and as evidence of the industry’s vibrance – the SEM Conference welcomed its most-ever registrants and successfully stayed true to its mission of advancing the alternatives investment industry.

Over 90 speakers, panelists, and moderators delivered rich content and facilitated discussions across 17 sessions. Content spanned growth strategies for managers, peer-to-peer exchanges for LPs, and other topics relevant to the SEM industry. This year, new “Master Class” sessions offered technology strategies for managers and put a spotlight the importance of diversity, equity, and inclusion programs at organizations regardless of their size. Because of the hard work and participation of so many, the SEM Conference successfully upheld its tradition as an essential industry event despite the highly untraditional backdrop.

BY THE NUMBERS

The SEM Conference drew a record number of registrants and first-time attendees and welcomed both “next generation” managers and large institutional investors alike.

A mix of industry leaders exchanged ideas and insights throughout the conference.

A wide range of allocators gained valuable access to GPs, provided insights about their approaches, and learned from their peers.

INVESTING IN THE CURRENT ENVIRONMENT

It was no surprise that issues affecting society in 2020 were top of mind alongside investment-focused topics at the SEM Conference. In particular, two underlying themes emerged – the ongoing effects of the COVID-19 pandemic on managers’ and LPs’ businesses, and the importance of diversity and strong culture to drive organizational success.

The Impact of Working Remotely

This year, LPs and Consultants believe they have benefited in many ways from the relative ease of connecting with managers remotely, such as through video calls. One consultant pointed out the efficiency of remote meetings by asking, “Why weren’t we doing this before?” He added candidly that he prefers portfolio managers to spend less time on the road marketing their funds, and more time managing them – a view likely shared by many portfolio managers themselves.

But LPs have also faced hurdles as they seek to identify and invest with small and emerging managers. The number of office visits and onsite due diligence sessions have been reduced, and the in-person meeting – a valuable part of evaluating a new manager – is rare. Thus, there was much discussion about how to LPs can best maintain visibility into a manager’s investments, operations, and other key elements of its business.

Every year, hundreds of GPs attend the SEM Conference to learn about growth strategies from LPs, consultants, and peers. This year was no exception, but most discussions around strategy and tactics included the phrase “…in the current environment.”

For a small or early-stage manager, the pandemic’s effects on its business have been significant. GPs discussed how the challenges of remote work and observed that the limitations of virtual interactions have in many cases offset the benefits. One GP noted “The barriers of reaching people and connecting with people are lower,” while another quipped “It can be done, but it ain’t no fun,” in reference to virtual diligence of his firm and its investments.

Featured Speaker: How One CEO Is Navigating the Pandemic

Debra Cafaro, Chairman and Chief Executive Officer, Ventas Inc.

Special guest Debra Cafaro spoke at the fifth annual Women’s Networking Session and highlighted how she is using lessons learned to manage through the current crisis. Her firm, Ventas, sits at the intersection of healthcare and real estate, with over 1,200 assets including senior housing, medical offices, hospitals, and research facilities, and thus has been uniquely affected. Some notable remarks:

  • CEOs are hired to navigate business cycles that last 5-10 years, and crises tend to punctuate those cycles. It is challenging to adapt and be flexible enough to pursue growth while dealing with a crisis. “The key to managing is to identify and disconnect the problems that may lead to a negative spiral,” said Ms. Cafaro.
  • COVID-19 has been uniquely challenging. Previous crises provided a sort of toolkit – there are often common elements – but this one is different, especially because of the clinical aspects. “I have not had to deal with the weight of mortality before,” she said.
  • Ventas prioritized and put the full weight of its firm behind keeping its stakeholders safe, including front line workers, employees, residents, and patients in buildings. “You have to get through it…you must have staying power to get through crisis. When you get to the other side, you can start to build back.”

The Importance of Diversity, Equity, and a Strong Culture

This year, as conversations about social justice and equality extended into board rooms, conference rooms, and break rooms of organizations everywhere, businesses focused on the importance of a diverse, equitable, and engaged culture as a key to success.

Discussion of these issues often took center stage throughout the SEM Conference. Participants openly shared their experiences and their organizations’ actions. One presenter observed that “it’s not a moment, but a movement toward greater inclusion in our organization.” To further the conversations, the conference welcomed Bryan Stevenson, founder of the Equal Justice Initiative, as Keynote Speaker, and Diversity and Inclusion Strategist Dr. Derrick Gay helped lead a session dedicated to the topic.

Keynote Speaker: Four Steps to Overcoming Inequality

Bryan Stevenson, Founder and Executive Director of the Equal Justice Initiative

Bryan Stevenson, who for decades has helped the poor, the incarcerated, and the condemned as a public interest lawyer, shined a light on how the adversities we are facing have disproportionately impacted underserved communities. In doing so, he shared four specific actions we can take to help solve this and other types of inequality in our communities and businesses.

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Get closer to where inequality exists. The value of proximity is that it allows for better judgement. “You can’t be indifferent,” he says.Change the narratives. Some of the issues we are debating are underpinned in inequality. “As we think about building healthy businesses and commerce, we have to commit to truth and justice.”

Be hopeful. Innovation comes from someone with the hope they can do something better. “This is a moment in history where we have to stay hopeful about what we do.”
Be willing to take risks and step out of your comfort zone. He says, “I am persuaded that if we’re going to create healthy communities…healthy environments…we have to be willing to do things that are uncomfortable.”