Client-Focused Solutions

As an external investment team and comprehensive solution, Caledon takes a long term perspective on client portfolio construction, as we seek to be evaluated and rewarded based on long term sustainable returns. We balance the number of clients we work with in order to ensure meaningful regular interaction between our investment team and clients’ internal investment manager(s), typically working directly with the Chief Investment Officer (CIO). Our strategy allows clients to have one point of contact to a wide selection of private market investment managers and direct investment opportunities.

Introduction of Private Markets Program

In order to initiate a private markets program, a clear and compelling case must be made to senior management and/or the investment committees of institutions. Caledon will work with clients to develop an education program to assist their board/investment committee and senior management in becoming better informed on the details and issues of private markets so that they can make prudent decisions in formulating appropriate investment strategies. This phase may include (i) providing a detailed description of private markets and the alternative means to access investment opportunities; (ii) addressing both the rationale for investing in private markets and the primary risks and issues involved with establishing a private markets program; and (iii) introducing and reviewing a number of concepts and topics that require consideration.

Strategy Development or Review

Caledon works collaboratively with each client to understand the short and long term needs of their private markets portfolio and to design (or enhance) a customized strategy, execute an investment allocation plan that meets their objectives, and implement portfolio monitoring and reporting processes. We evaluate risk and return factors such as an investment portfolio’s risk profile, return expectations, appropriate benchmarks, liquidity requirements, as well as training internal client staff to help construct a framework for private markets investing.

Caledon’s principals have built long standing relationships with top tier fund managers and emerging General Partners (GPs), intermediaries, and institutional investors and limited partners in both the private equity and infrastructure areas over many years and continue to maintain strong ongoing communication with these market participants. These relationships allow us to have continual access to sought-after investments including funds, secondaries and direct / co-investment opportunities, and to identify up-and-coming managers that have the potential to become top-tier funds. Caledon adopts a flexible approach to portfolio construction, prudently diversifying across fund/investment type, sub-sector, geography and vintage year, employing a combination of primary fund commitments with co-investments, secondaries and direct company/asset investments where appropriate.

For institutions seeking to review or enhance their existing programs, Caledon will work with clients to assess and adjust, where necessary, existing strategies and investment allocation plans. We can evaluate existing private markets portfolios and assess performance and exposures by sub-asset class, sector, geography, vintage year, and other relevant characteristics to identify over and under allocations against updated investment plans/targets. During this process, Caledon will be able to identify where attention is required – targeting new or future investments/commitments in desired sectors, prudently limiting investment in certain strategies and/or strategically reducing investments/commitments in over-allocated sectors or those that are underperforming.

Implementation

With a client’s customized private markets investment strategy in place and/or having been revised, Caledon identifies and evaluates opportunities that fit with the client’s objectives, which are anticipated to outperform in the existing market environment, and should be well-positioned for the long-term. Caledon follows a standard and rigorous investment process, including opportunity specific due diligence, to implement and execute on our clients’ investment strategies and investment allocation plans, as outlined in the Investment Process section.