Key takeaways
On keeping perspective in a downturn:
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Don't be short sighted; be thinking about the long term. If you look at the S&P when I started my career, it's up 35X. If you look at the NASDAQ since I started my career, it's up 83X. So don't get caught at the moment. This is not a time to be gloomy. Stay positive, stay calm.
—Joe Dowling, Blackstone Global Head of Blackstone Alternative Asset Management
On why now is a great time to innovate:
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We work in the world of innovation, and we think that right now is one of the best times to start a company. In capital constrained markets, you have companies that are forced to do more with less. If you look at some of the biggest tech companies that have ever been built, it was right after or during times of economic dislocations.
——Samir Kaji, Allocate Co-founder & CEO
On investing through cycles:
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Our biggest piece of advice is to stay invested, because it's almost impossible to time the market. If you go back and look from the crisis in 2008 all the way up to the end of last year, if you had missed the 50 best trading days, you would have given up 100% of the return of the market. Even giving up the best 10 days—10 days out of almost a decade and a half—you lose almost half of the return.
—Sara Naison-Tarajano, Goldman Sachs Partner, Global Head of Private Wealth Management Capital Markets, Global Head of Apex Family Office Coverage
On staying focused:
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Innovators don't wake up and check the stock market to see whether they should innovate today.
—Carter Reum, M13 Partner & Co-founder
The future of investing
Future Perfect is M13’s thought leadership series, where we convene investors and founders to reflect on the lessons and innovations that inform how we will build the future. In May, we gathered in New York City to hear from the vanguards of technology, innovation, and investing.
It’s no secret that the last year has been a rapid departure from the halcyon days of high valuations and readily available capital, particularly in 2020–2022. But while the current economic climate may feel jarring or stressful, the truth is, we’ve been here before. In the face of volatility and uncertainty, there’s much to learn from the past about successful long-term investing.
Joe Dowling (Blackstone Global Head of Blackstone Alternative Asset Management), Samir Kaji (Allocate Co-founder & CEO), and Sara Naison-Tarajano (Goldman Sachs Partner, Global Head of Private Wealth Management Capital Markets, Global Head of Apex Family Office Coverage) joined M13 Partner and Co-founder Carter Reum to talk about the future of investing and how to navigate the current economic climate.
Keeping a long-term perspective
Blackstone’s Joe Dowling is no stranger to investing through crises. “I started my career in June of 1987. As I was thinking about all the crises that I lived through, I had to write them down, there were so many.” His list includes: the S&L crisis, invasion of Kuwait and the Gulf War, the dot-com bubble, 9/11, the 2008 crisis, the taper tantrum of 2013, the European sovereign debt crisis, the China hard landing, and most recently, Covid-19.
So what has he learned?
“Don't be short sighted; be thinking about the long term. If you look at the S&P when I started my career, it's up 35X. If you look at the NASDAQ since I started my career, it's up 83X. So don't get caught at the moment. This is not a time to be gloomy. Stay positive, stay calm.”
He encourages investors to use this time to focus on business models, drill down on evaluating the quality of companies they’re investing in, go after large TAMs (total addressable market), and continue to innovate. This is a time for calm, long-term thinking, and it’s vital not to get caught up in group think.
Goldman Sachs' Sara Naison-Tarajano agrees. “We tell clients all the time through these crises: our biggest piece of advice is to stay invested, because it’s almost impossible to time the market.”
Goldman’s research into past cycles reveals that missing even a handful of trading days can hugely impact returns over time. Looking from roughly 2008 through 2022, “if you had missed the 50 best trading days, you would have given up 100% of the return of the market. Even giving up the best 10 days—10 days out of almost a decade and a half—you lose almost half of the return.”
Reacting to short-term market fluctuations can have outsized long-term consequences. Keeping a long-term perspective—and remembering what you’ve learned from surviving past cycles—is essential.
Downturns are a great time to innovate
“We work in the world of innovation, and we think that right now is one of the best times to start a company,” says Samir Kaji, CEO & Co-founder of Allocate, a digital investment platform that gives family offices and wealth advisors access to venture funds and co-investments.
From a technology standpoint, innovation is happening at an extraordinary pace. Advancements in mobile, cloud, and now AI have brought us to a point where the speed of technological progress is faster than ever.
At the same time, the shift toward a tightening environment is spurring new focus in emerging companies. “In times like this, I think of all these great companies we know today—Airbnb, Uber—that came out of 2008,” says M13 Partner & Co-founder Carter Reum. “What do big companies do? They retreat to their core and leave behind blind spots. It’s much, much easier to innovate now, in a recessionary environment.”
Samir agrees: “In capital constrained markets, you have companies that are forced to do more with less. And so if you look back at ‘08, ‘09, at some of the biggest tech companies that have ever been built, they were built right after or during times of economic dislocations. From day one, you have to build a fundamental business.”
In a rosier environment, there were many companies whose advantage was how much they raised, as opposed to their unit economics. Today, innovators and investors need to ask: Who has a durable business model? Who will clients actually want to stick with?
“When money's coming out of the system, it's a different world,” says Joe. “You have to go back to basics. You've got to focus on the quality of the company; you have to focus on the unit economics. And you have to forget about some of the things that you learned in a QE world where everything goes up and get ready for the grind. It will be a grind—but it'll be worth it.”
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The future of the family office
Alternative assets—private equity, private real estate and infrastructure, hedge funds, and private credit—are playing a major role in today’s investing strategies.
Goldman’s recent family office investment report found that family offices continue to hold outsized allocations to alternatives, with alternatives making up 44% of holdings for global family offices surveyed (70% of which had $1B+ in assets). This looks different from a typical high-net-worth client: “I think because we’re talking about such large pools of capital, they're highly comfortable with that illiquidity. And they've seen the outperformance of those illiquid assets over time,” says Sara. “They can be nimble and act on dislocations.”
Venture capital is an asset class that can offer truly early access to long-term value. “The case for venture is that you’re really investing in the future,” Samir explains. “If you look at these large deca-corn tech companies that have gone public, the first $20B in enterprise value was all in the private markets. To get access to the future, you have to invest in the asset category that backs these innovative companies early.”
“Today, we're really looking at potentially more muted public equity return for the next 6 to 18 months,” adds Sara, “But then on top of that, being able to really get double digit returns in the private credit market.”
Don’t panic (and don’t check the stock market every 5 minutes)
Making sound long-term investments requires a level head, asking the right questions, and not making reactive decisions.
“Family offices are all about preserving capital,” says Sara. “The biggest risks that you can take in terms of preserving your own capital is permanent loss—and you experience permanent loss when you panic sell.”
How do you block out the noise of market fluctuations to focus on the future?
“I think there are a lot of behavioral tricks that you can use. One is not checking the stock market every five minutes,” says Joe.
In a tightening economic climate, focus on long-term thinking and ask different questions about your portfolio. What’s the yield on my portfolio? How much of my portfolio is going to go up only if equities go up? Or only if multiple go up? Where should I focus on other asset classes?
Sara agrees: “Don’t look at the accounts. Don’t follow the stock market. I actually think this is why we see a lot of family offices with higher allocations to illiquids—they don’t mark-to-market every single day, and so it’s psychologically easier to manage through cycles than it is when you have an outsized public portfolio.”
“We actually view illiquidity as more of a feature than a bug,” Samir adds. “Because it prevents people from panic selling.”
Thank you to our speakers
Joe Dowling is a Senior Managing Director and the Global Head of Blackstone Alternative Asset Management (BAAM), where he oversees and leads all of BAAM’s investment activities.
Prior to joining Blackstone in 2021, Mr. Dowling led Brown University’s endowment, including as Chief Executive Officer from July 2018 to July 2020 and Chief Investment Officer from June 2013 to July 2018. Mr. Dowling also served as interim Chief Financial Officer of the University from May 2019 until January 2020, leading all finance and treasury functions as well as cash and debt management.
Before joining Brown University, he was the Founder and Chief Executive Officer of Narragansett Asset Management, where he managed funds for institutions, pension funds, and endowments. Mr. Dowling has also worked for First Boston and Tudor Investments. Mr. Dowling has a BA from Harvard College and an MBA from Harvard Business School.
Samir Kaji is the CEO and co-founder of Allocate. Prior to Allocate, Samir spent nearly 22 years in venture banking between SVB and First Republic Bank and closely worked with and advised over 700 venture capital and private equity firms. During this time, he completed over $12B in structured debt transactions and invested personally in over 60 funds and companies, including early-stage investments into Carta (seed), Side (seed), PolicyGenius (Series A), and FanDuel (Series B) as well as growth investments into Reddit, Alto Pharmacy, and Carbon Health.
Samir is also an active writer on venture capital, and is the host of a top venture podcast called Venture Unlocked.
Samir completed a finance undergraduate degree at San Jose State University, holds an MBA from Santa Clara University, and completed the prestigious Kauffman Fellows venture program. He currently lives in Menlo Park with his wife Ashlee and their two cavapoo puppies Penny and Belle.
Sara Naison-Tarajano is Partner & Global Head of Private Wealth Management (PWM) Capital Markets at Goldman Sachs. The team is responsible for the transactional business in PWM across asset classes to high net worth individuals and family offices. She is also Global Head of Goldman Sachs Apex, the dedicated family office coverage team that partners with private wealth advisors to deliver a broad suite of investment opportunities and services to family office clients of Asset & Wealth Management.
Sara is also one of the partners leading the One Goldman Sachs Family Office Initiative in the Americas and is a member of the Partnership Committee and the Firmwide Suitability Committee. She is also the former co-head of the Consumer and Wealth Management Women’s Network. Previously, Sara was head of the Markets Coverage Group for the Americas. She joined Goldman Sachs as an analyst in the Investment Banking Division in 1999 and was named managing director in 2012 and partner in 2020.
Sara serves on the Board of Directors of the Innocence Project. She is a member of the Wall Street Division Steering Committee of the UJA-Federation. Sara earned a BA, cum laude with distinction, in American Studies from Yale College in 1999.
Thank you to our sponsors
Key takeaways
On keeping perspective in a downturn:
Don't be short sighted; be thinking about the long term. If you look at the S&P when I started my career, it's up 35X. If you look at the NASDAQ since I started my career, it's up 83X. So don't get caught at the moment. This is not a time to be gloomy. Stay positive, stay calm.
—Joe Dowling, Blackstone Global Head of Blackstone Alternative Asset Management
On why now is a great time to innovate:
We work in the world of innovation, and we think that right now is one of the best times to start a company. In capital constrained markets, you have companies that are forced to do more with less. If you look at some of the biggest tech companies that have ever been built, it was right after or during times of economic dislocations.
——Samir Kaji, Allocate Co-founder & CEO
On investing through cycles:
Our biggest piece of advice is to stay invested, because it's almost impossible to time the market. If you go back and look from the crisis in 2008 all the way up to the end of last year, if you had missed the 50 best trading days, you would have given up 100% of the return of the market. Even giving up the best 10 days—10 days out of almost a decade and a half—you lose almost half of the return.
—Sara Naison-Tarajano, Goldman Sachs Partner, Global Head of Private Wealth Management Capital Markets, Global Head of Apex Family Office Coverage
On staying focused:
Innovators don't wake up and check the stock market to see whether they should innovate today.
—Carter Reum, M13 Partner & Co-founder
The future of investing
Future Perfect is M13’s thought leadership series, where we convene investors and founders to reflect on the lessons and innovations that inform how we will build the future. In May, we gathered in New York City to hear from the vanguards of technology, innovation, and investing.
It’s no secret that the last year has been a rapid departure from the halcyon days of high valuations and readily available capital, particularly in 2020–2022. But while the current economic climate may feel jarring or stressful, the truth is, we’ve been here before. In the face of volatility and uncertainty, there’s much to learn from the past about successful long-term investing.
Joe Dowling (Blackstone Global Head of Blackstone Alternative Asset Management), Samir Kaji (Allocate Co-founder & CEO), and Sara Naison-Tarajano (Goldman Sachs Partner, Global Head of Private Wealth Management Capital Markets, Global Head of Apex Family Office Coverage) joined M13 Partner and Co-founder Carter Reum to talk about the future of investing and how to navigate the current economic climate.
Keeping a long-term perspective
Blackstone’s Joe Dowling is no stranger to investing through crises. “I started my career in June of 1987. As I was thinking about all the crises that I lived through, I had to write them down, there were so many.” His list includes: the S&L crisis, invasion of Kuwait and the Gulf War, the dot-com bubble, 9/11, the 2008 crisis, the taper tantrum of 2013, the European sovereign debt crisis, the China hard landing, and most recently, Covid-19.
So what has he learned?
“Don't be short sighted; be thinking about the long term. If you look at the S&P when I started my career, it's up 35X. If you look at the NASDAQ since I started my career, it's up 83X. So don't get caught at the moment. This is not a time to be gloomy. Stay positive, stay calm.”
He encourages investors to use this time to focus on business models, drill down on evaluating the quality of companies they’re investing in, go after large TAMs (total addressable market), and continue to innovate. This is a time for calm, long-term thinking, and it’s vital not to get caught up in group think.
Goldman Sachs' Sara Naison-Tarajano agrees. “We tell clients all the time through these crises: our biggest piece of advice is to stay invested, because it’s almost impossible to time the market.”
Goldman’s research into past cycles reveals that missing even a handful of trading days can hugely impact returns over time. Looking from roughly 2008 through 2022, “if you had missed the 50 best trading days, you would have given up 100% of the return of the market. Even giving up the best 10 days—10 days out of almost a decade and a half—you lose almost half of the return.”
Reacting to short-term market fluctuations can have outsized long-term consequences. Keeping a long-term perspective—and remembering what you’ve learned from surviving past cycles—is essential.
Downturns are a great time to innovate
“We work in the world of innovation, and we think that right now is one of the best times to start a company,” says Samir Kaji, CEO & Co-founder of Allocate, a digital investment platform that gives family offices and wealth advisors access to venture funds and co-investments.
From a technology standpoint, innovation is happening at an extraordinary pace. Advancements in mobile, cloud, and now AI have brought us to a point where the speed of technological progress is faster than ever.
At the same time, the shift toward a tightening environment is spurring new focus in emerging companies. “In times like this, I think of all these great companies we know today—Airbnb, Uber—that came out of 2008,” says M13 Partner & Co-founder Carter Reum. “What do big companies do? They retreat to their core and leave behind blind spots. It’s much, much easier to innovate now, in a recessionary environment.”
Samir agrees: “In capital constrained markets, you have companies that are forced to do more with less. And so if you look back at ‘08, ‘09, at some of the biggest tech companies that have ever been built, they were built right after or during times of economic dislocations. From day one, you have to build a fundamental business.”
In a rosier environment, there were many companies whose advantage was how much they raised, as opposed to their unit economics. Today, innovators and investors need to ask: Who has a durable business model? Who will clients actually want to stick with?
“When money's coming out of the system, it's a different world,” says Joe. “You have to go back to basics. You've got to focus on the quality of the company; you have to focus on the unit economics. And you have to forget about some of the things that you learned in a QE world where everything goes up and get ready for the grind. It will be a grind—but it'll be worth it.”
The future of the family office
Alternative assets—private equity, private real estate and infrastructure, hedge funds, and private credit—are playing a major role in today’s investing strategies.
Goldman’s recent family office investment report found that family offices continue to hold outsized allocations to alternatives, with alternatives making up 44% of holdings for global family offices surveyed (70% of which had $1B+ in assets). This looks different from a typical high-net-worth client: “I think because we’re talking about such large pools of capital, they're highly comfortable with that illiquidity. And they've seen the outperformance of those illiquid assets over time,” says Sara. “They can be nimble and act on dislocations.”
Venture capital is an asset class that can offer truly early access to long-term value. “The case for venture is that you’re really investing in the future,” Samir explains. “If you look at these large deca-corn tech companies that have gone public, the first $20B in enterprise value was all in the private markets. To get access to the future, you have to invest in the asset category that backs these innovative companies early.”
“Today, we're really looking at potentially more muted public equity return for the next 6 to 18 months,” adds Sara, “But then on top of that, being able to really get double digit returns in the private credit market.”
Don’t panic (and don’t check the stock market every 5 minutes)
Making sound long-term investments requires a level head, asking the right questions, and not making reactive decisions.
“Family offices are all about preserving capital,” says Sara. “The biggest risks that you can take in terms of preserving your own capital is permanent loss—and you experience permanent loss when you panic sell.”
How do you block out the noise of market fluctuations to focus on the future?
“I think there are a lot of behavioral tricks that you can use. One is not checking the stock market every five minutes,” says Joe.
In a tightening economic climate, focus on long-term thinking and ask different questions about your portfolio. What’s the yield on my portfolio? How much of my portfolio is going to go up only if equities go up? Or only if multiple go up? Where should I focus on other asset classes?
Sara agrees: “Don’t look at the accounts. Don’t follow the stock market. I actually think this is why we see a lot of family offices with higher allocations to illiquids—they don’t mark-to-market every single day, and so it’s psychologically easier to manage through cycles than it is when you have an outsized public portfolio.”
“We actually view illiquidity as more of a feature than a bug,” Samir adds. “Because it prevents people from panic selling.”
Thank you to our speakers
Joe Dowling is a Senior Managing Director and the Global Head of Blackstone Alternative Asset Management (BAAM), where he oversees and leads all of BAAM’s investment activities.
Prior to joining Blackstone in 2021, Mr. Dowling led Brown University’s endowment, including as Chief Executive Officer from July 2018 to July 2020 and Chief Investment Officer from June 2013 to July 2018. Mr. Dowling also served as interim Chief Financial Officer of the University from May 2019 until January 2020, leading all finance and treasury functions as well as cash and debt management.
Before joining Brown University, he was the Founder and Chief Executive Officer of Narragansett Asset Management, where he managed funds for institutions, pension funds, and endowments. Mr. Dowling has also worked for First Boston and Tudor Investments. Mr. Dowling has a BA from Harvard College and an MBA from Harvard Business School.
Samir Kaji is the CEO and co-founder of Allocate. Prior to Allocate, Samir spent nearly 22 years in venture banking between SVB and First Republic Bank and closely worked with and advised over 700 venture capital and private equity firms. During this time, he completed over $12B in structured debt transactions and invested personally in over 60 funds and companies, including early-stage investments into Carta (seed), Side (seed), PolicyGenius (Series A), and FanDuel (Series B) as well as growth investments into Reddit, Alto Pharmacy, and Carbon Health.
Samir is also an active writer on venture capital, and is the host of a top venture podcast called Venture Unlocked.
Samir completed a finance undergraduate degree at San Jose State University, holds an MBA from Santa Clara University, and completed the prestigious Kauffman Fellows venture program. He currently lives in Menlo Park with his wife Ashlee and their two cavapoo puppies Penny and Belle.
Sara Naison-Tarajano is Partner & Global Head of Private Wealth Management (PWM) Capital Markets at Goldman Sachs. The team is responsible for the transactional business in PWM across asset classes to high net worth individuals and family offices. She is also Global Head of Goldman Sachs Apex, the dedicated family office coverage team that partners with private wealth advisors to deliver a broad suite of investment opportunities and services to family office clients of Asset & Wealth Management.
Sara is also one of the partners leading the One Goldman Sachs Family Office Initiative in the Americas and is a member of the Partnership Committee and the Firmwide Suitability Committee. She is also the former co-head of the Consumer and Wealth Management Women’s Network. Previously, Sara was head of the Markets Coverage Group for the Americas. She joined Goldman Sachs as an analyst in the Investment Banking Division in 1999 and was named managing director in 2012 and partner in 2020.
Sara serves on the Board of Directors of the Innocence Project. She is a member of the Wall Street Division Steering Committee of the UJA-Federation. Sara earned a BA, cum laude with distinction, in American Studies from Yale College in 1999.
Thank you to our sponsors
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