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It’s entirely possible that pensions had some dollars wrapped up in WeWork but I don’t have inside knowledge or anything, they just have a decent backplane of i
by awinder 7y ago
It’s entirely possible that pensions had some dollars wrapped up in WeWork but I don’t have inside knowledge or anything, they just have a decent backplane of institutional investors. But you can’t take this view that every failed investment “hurt” people. Some investments outperform expectations, some you nail, and some are big dumpster fires. A lot of this seems tied up in the myth that everyone knows what they’re doing: they don’t, grand majority of people are winging it to various degrees most of the time.
- isoskeles 7y agoCan/do pension funds invest in private companies? Seriously asking. Edit: I don't understand why this would get downvoted, and I am endlessly amazed by how weird or sensitive people are on HN. Just to downvote without even answering a simple fucking question in earnest.
- SpicyLemonZest 7y agoI think "seriously asking" actually ends up making your comment seem ruder rather than nicer. The phrase has taken the same loop as "literally", unfortunately. To answer the question, they do. Many pension funds manage billions of dollars, so they're at the scale where complex investments like that start to make sense. Even when they don't directly do it, very large private companies like WeWork often start getting included in mutual funds.
- isoskeles 7y agoFair enough, might have been better to leave out those words completely. I also thought about writing an entire sentence on it, such as, "I am asking this in earnest, not trying to make some point in a debate with a rhetorical question." But then I thought it would be too much.
- SpicyLemonZest 7y agoIt's definitely a hard balance to strike.
- awinder 7y agoxD I don’t know either but I did my best to make you whole on needless downvoting. But yes, pension funds do invest in private companies in a few ways. Some of it is relatively recent. They absolutely will invest during the “road show” of pre-ipo companies, but I’ve also seen numbers like up to 20% of vc funds coming from public pension funds [1]. It’s actually kinda a great idea imo, they’re definitely not betting the farm on these companies, and it’s a great way to get further diversification on an asset class that probably moves differently from other asset classes. They’ve also branched into things like real estate trusts, another kind of diversification that moves off-cycle from other asset classes. [1] https://www.quora.com/Whats-the-relationship-between-pension-funds-and-venture-capital https://www.quora.com/Whats-the-relationship-between-pension...
- isoskeles 7y agoThanks! Solid answer/source too, I appreciate it.
- seanhunter 7y agoYes they do sometimes.
- disqard 7y agoThis is an important (and unsettling) realization. I find this to be true of many "superstar"-type folks.