TLDR:
- Velliv, a Danish pension fund with DKK 13bn invested in private equity, is scaling back on venture capital investments.
- The Head of Alternatives, Christoph Junge, states that satisfying returns on venture capital investments are rare.
In a recent statement, Christoph Junge, Head of Alternatives at Velliv, explained the pension fund’s cautious approach towards venture capital investments. Despite having DKK 13bn (EUR 1.74bn) invested in private equity, Velliv has decided to reduce its exposure to venture funds due to the challenges in achieving satisfying returns in this asset class.
The move to phase out venture funds from the portfolio aligns with Velliv’s strategy to prioritize investments that offer more stable and predictable returns. While the pension fund does maintain a few investments in venture capital, it is clear that Velliv is shifting its focus towards other types of investments within the alternatives space.
This decision reflects the broader trend among some Danish pension funds, such as Industriens Pension and P+, which are also reducing their allocations to venture funds in favor of buyout funds. By prioritizing investments with more predictable returns, Velliv aims to optimize its portfolio and minimize risks associated with volatile asset classes like venture capital.
As the Head of Alternatives at Velliv, Christoph Junge’s insights shed light on the challenges and considerations that pension funds face when making investment decisions in the alternatives space. By adapting their investment strategies to changing market conditions, Velliv demonstrates a commitment to prudent risk management and sustainable long-term growth.
