b'ILPA PRIVATE MARKETS EDGE Q1 202110 11TAKE ACTION - LP TALENTMember SpotlightsHear from two ILPA members on what they are doing differently on talent and get inspired to take action. Community Ties and Non- How TRS Leveraged an Expanding Traditional Approach to TeamCo-Investment Program to Grow its Building at ColgateInvestment Team ColgateUniversity,aU.S.endowmentbasedinThechallengesassociatedwithequippingnon- TeacherRetirementSystemof Texas,aU.S.publicBy the end of 2021, the TRS private equity team Hamilton, New York has been an ILPA member fortraditionalcandidateswiththenecessarybaselinepension based in Austin, Texas, manages over 175will have almost doubled in sizefrom 14 investment 3 years. As an investment program, the endowmentknowledgeandskillswereclear,andColgatebillionUSD.TRShasbeenmovingassertivelytoprofessionals to 25with authorization to increase the managesapproximately1billionUSDwithrespondedwithanintensiveandhands-ontrainingincrease net returns for its teachers through a strategyheadcount further in the coming years. While still a approximately25%allocatedtoprivatemarkets,program. Focusing on Colgates individual approachofaugmentingitsin-houseinvestmentcapabilitieswork in progress, TRS is pleased with the team it has including buyout, special situations, venture and realtoendowmentmanagement,theteamwasabletoandtherebyreducingexternalmanagerfees.Inbeen able to attract and retain, the growth in the co-assets. concentrate on the basics and slowly build knowledge2017,TRSbeganlookingtoevolveitsportfolioinvestment portfolio and the performance generated.In 2020, Colgate participated in ILPAs Talent Initiativewithin specific topic areas. strategy, and in concert, its organizational structure research and shared a unique approach to staffingWith a solid team now in place, there is a focus ontoachievereturnssufficienttomeetincreasing their investment team, particularly with respect to thecontinuing to develop bench strength. Given a smallbeneficiary obligations. The TRS team, in conjunction academic backgrounds of its analysts. team,asingledeparturewouldhaveasignificantwith an outside consultant, determined that bringing impact and cross training provides additional depthmoreinvestmentcapabilitiesin-housewouldhelp Upon the hiring of Colgates first CIO in 2008, theandcontinueddevelopment.Colgatenotesthatreduce fees to external managers, without sacrificing decision was made that staff members would continueyears later, we all continue to learn as the portfolioperformance, and allow the organization to deliver on tobebasedoncampusatacticembracedbyaand markets continue to evolve. its objectives. number of peers as wellbut there was a recognition thatbringingtalenttocentralNewYorkwouldbeWithin the private equity portfolio at TRS, the focus a challenge. This forced the team to be thoughtfulon increased internal capabilities translated to a goal about attracting high potential candidates, with theof investing a larger proportion of the portfolio intoTALENT INSIGHT:schoolandsurroundingareaidentifiedasmajorco-investments to capitalize on the fee-advantagedStaffing Modelsfactors in attracting candidates. nature of those investments. The team set an initial Colgates initial approach was to hire a recent ColgateTALENT INSIGHT: milestoneofgrowingtheshareofco-investments graduate interested in pursuing an investment relatedfrom ~20% of the portfolio to a minimum of 35%.The investment team is any organizations career for a three-year term, providing an opportunityHiring greatest resource.Carefully consider how togainexposuretotheindustrywhileearningaShifting to more co-investment necessitatedto deploy existing resources and plan for CFAcertification.WhileoneanalystsuccessfullyWhen hiring take advantage of thethe addition of new team memberswhat it will take to attract and retain the completed the program, finding another candidatetalent pool available and consider non- taskedwithdiligencingthehighervolumeofright team over the long term.proved difficult. At this point, a pivot was made to atraditional backgrounds. Understand whyopportunities, as well as selecting investments which long-term staffing solution. a role is interesting to a candidate andcould also be additive to the anticipated fee savings. Aninternalhirewithpriorexperienceinmutualmake connections to the fundamentalAny increases in internal costs associated with the new funds was moved into an investment manager role,work of investment professionals.team members and infrastructure were forecast to be marking the first step in a new direction.Two analystsLeave room for transferable skillsmarginal relative to the external fee savings realized. were also added to the team, each with ties to theto surprise you. The board of trustees focus on net returns enabled localcommunitybutrepresentingnon-traditionalTRS to secure the green light for additional hires.backgrounds in Education and Psychology.'