Alt Goes Mainstream: The Latest on Alternative Investments, WealthTech, & Private Markets

Welcome back to the Alt Goes Mainstream podcast. Today’s episode dives into the rapidly expanding world of secondaries with a senior leader at one of the pioneering firms in the secondaries space. We sat down at Franklin Templeton’s New York office with Taylor Robinson, a Partner on the Secondary team at Lexington Partners, which has over $77B in total capitalization and is part of Franklin Templeton’s family of private markets funds and strategies. Taylor, who joined the firm in 2008, is primarily focused on the origination, evaluation, and execution of secondary opportunities, including partnership and GP-led transactions. He’s also a member of Lexington’s ESG Steering Committee. Taylor and I had a fascinating conversation about the current state of the secondaries market. We covered many of the hot button topics and trends that are shaping the secondaries market, including: Why secondaries have become an integral part of many LPs portfolios.How secondaries have become a portfolio management tool for LPs.The rise of GP-led secondaries.Why not all CVs are created equal.Why secondaries can be a good on-ramp to private markets for wealth channel investors.What the future holds for secondaries.Thanks Taylor for coming on the show to share your expertise and wisdom about private markets and secondaries. Show Notes00:00 A Different Way of Thinking About Private Equity 00:43 Welcome to the Alt Goes Mainstream Podcast 01:20 Introduction to Taylor Robinson 02:35 Taylor Robinson's Background and Career 04:25 The Evolution of the Secondaries Market 05:20 Impact of the Financial Crisis on Secondaries 06:34 Growth and Liquidity in Private Markets 07:13 Current State of the Secondaries Market 07:29 Traditional vs. GP-Led Secondary Deals 09:18 Challenges and Opportunities for Institutional LPs 11:22 Active Portfolio Management Strategies 13:06 Driving Returns and Gaining Edge 14:46 Evaluating and Partnering with GPs 16:30 Nuances of the Secondary Market 17:22 Market Dynamics and Investment Strategies 18:04 The Role of Data and Technology 19:35 Regulation and Standardization in Private Markets 20:08 Evolving Focus of Secondaries Firms 20:51 Investment Horizons and Return Expectations 22:17 Primary vs. Secondary Fund Investing 27:07 Specialization and Diversification in Private Equity 28:41 Managing Favorite Assets 28:49 Diversified Portfolio Nuances 29:37 Generating Alpha in Secondaries 30:22 Asset Selection and Value Drivers 31:09 Consistent Investor Experience 33:53 Comparing Secondaries and Primaries 35:51 Evaluating Secondaries Over Time 37:18 Evergreen Funds and New Structures 38:11 Benefits of Locked-Up Capital 40:34 Challenges in Evergreen Space 41:39 Wealth Channel and Scale 43:04 Skillset for Secondaries Investors 45:16 Intellectual Curiosity and Success 47:45 Industry Trends and GP Consolidation 49:16 Understanding Market Dynamics 50:18 Training and Retention at Lexington 50:41 Future of Secondary Markets 52:54 Misconceptions About Secondaries 54:31 Shifting Mindsets on Discounts 54:54 Consistent Returns Through Cycles 55:42 Secondaries as a Real Asset Class 56:16 Excitement for Future Growth 56:22 Conclusion and Farewell Editing and post-production work for this episode was provided by The Podcast Consultant.