HarbourVest's John Toomey - over 40 years of "earning investors' trust"

Welcome back to the Alt Goes Mainstream podcast.

Today’s episode dives into the nuances of private markets with one of the industry’s leaders.

We sat down with HarbourVest CEO John Toomey, where he leads a firm that has over $160B in AUM and has over 43 years of experience across primary funds, secondary transactions, direct co-investments, and building customized programs for LPs.

John has been at HarbourVest for almost 30 years, joining the firm in 1997 as an Analyst in the Direct team. He spent 10 years as one of the leaders of the Secondary business before serving on Global Investment Committees for nearly a decade. He also served as the original CFO for the HarbourVest Global Private Equity vehicle, which went public in 2007 on Euronext Amsterdam.

John is also a member of the Firm’s Conflicts Committee, Sustainable Investing Council, and DEI Council. He received a BA (cum laude) in Chemistry and Physics from Harvard University and an MBA from Harvard Business School.

John and I had a fascinating and thought-provoking conversation about the evolution of private markets as an industry. We covered:

• The biggest differences between private markets in the 1990s and private markets today.
• How private markets has evolved over the past 30 years.
• What LPs are looking for today in their manager relationships.
• Do LPs want more choice or less?
• Why LPs, both institutions and wealth investors, might outsource private markets capabilities.
• How the institutionalization of private wealth platforms is shaping how alternative asset managers partner with the wealth channel.
• Where scale matters for alternative asset managers.
• Where allocators should be “narrow and limited” with their GP relationships and where allocators should be diversified.
• What is required for managers that launch and manage evergreen vehicles.
• The why and the how behind launching a private wealth solutions business.

Thanks John for coming on the show to share your wisdom, expertise, and passion for private markets.

Show Notes

00:00 Welcome to Alt Goes Mainstream

01:16 Sponsor Message Ultimus

02:11 Meet John Toomey

04:44 HarbourVest Then vs Now

05:32 LP Demands Transparency

07:21 Why Outsource Private Markets

09:02 Programmatic Portfolio Building

10:35 Earning Trust at Scale

12:17 Building Blocks for Clients

14:50 GP Needs and Access Points

16:49 Co-Investment Value Proposition

23:16 Big vs Niche Managers

27:04 Evergreen Funds and Wealth

30:55 Wealth Platform Consolidation

31:35 Who Can Build Evergreens

33:03 Evergreen Portfolio Ingredients

35:12 How Wealth Wants Access

36:27 Centralized CIO Model Shift

37:26 Manager Selection Matters

38:59 Diversification Versus Alpha

40:39 Funding Private Allocations

43:07 Secondaries As Onramp

44:47 Institutional Program Evolution

48:57 Institutions Using Evergreens

50:54 Liquidity And LP Mix

53:05 What Creates Manager Edge

56:05 Data Insights And Echoes

58:12 Closing Thoughts

A Word from Our Sponsor, Ultimus

This episode of Alt Goes Mainstream is brought to you by Ultimus, the full-service fund administrator and transfer agent powering asset managers in private and public markets. As alts go mainstream, you need real expertise to handle complex fund structures, connect with key distribution partners, and handle sophisticated compliance, reporting, and transparency demands.

That’s Ultimus: high-tech, high-touch solutions for over 450 clients and 2,500 funds with $775B in assets under administration. Backed by an expert team of over 1,200 employees, they place client service at the core of their business, helping you navigate complexity during your fund structuring or launch and then supporting you through every stage of growth. Whether you’re already in the market or thinking about entering private wealth, you can trust their team’s deep expertise in retail alternatives to help you reach your goals.

Learn more at ultimusfundsolutions.com or email [email protected].

We thank Ultimus for their support of alts going mainstream.

Disclosures

HarbourVest Partners, LLC is a registered investment adviser under the Investment Advisers Act of 1940. This material is solely for informational purposes and should not be viewed as a current or past recommendation or an offer to sell or the solicitation to buy securities or adopt any investment strategy.  The opinions expressed herein represent the current, good faith views of the author(s) at the time of publication, are not definitive investment advice, and should not be relied upon as such. This material has been developed internally and/or obtained from sources believed to be reliable; however, HarbourVest does not guarantee the accuracy, adequacy or completeness of such information. There is no assurance that any events or projections will occur, and outcomes may be significantly different than the opinions shown here.  This information, including any projections concerning financial market performance, is based on current market conditions, which will fluctuate and may be superseded by subsequent market events or for other reasons. The information contained herein must be kept strictly confidential and may not be reproduced or redistributed in any format without the express written approval of HarbourVest.

Nothing herein should be construed as a solicitation, offer, recommendation, representation of suitability, legal advice, tax advice, or endorsement of any security or investment and should not be relied upon by you in evaluating the merits of investing in HarbourVest funds or in any other investment decision. 

Editing and post-production work for this episode was provided by The Podcast Consultant.