Deals and People June 21, 2001

CalPERS' Alternatives Chief Leaves for East Coast Venture Capital Firm

June 20, 2001 (HedgeWorld.com) - Barry J. Gonder, senior investment officer in charge of the California Public Employees' Retirement System's alternatives program, is joining Grove Street Advisors LLC, which is the pension fund's strategic partner in its $20 billion alternative investment management program.

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He will be relocating to the Wellesley, Mass.-based firm, where he will become a general partner, a new position.

Grove Street Advisors manages California Emerging Ventures, CalPERS’ venture capital vehicle. The venture capital partnership began in 1998, when venture capital represented less than 5% of CalPERS’ total commitments to private equity.

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The program is a way for CalPERS to become an investor of choice for venture capital partnerships, which are recommended by Grove Street. As of March, the pension fund had about $1.2 billion with Grove Street.

Mr. Gonder leaves CalPERS on July 2, after five years at the $155 billion retirement system. Rick Hayes, senior principal investment officer will replace Mr. Gonder in the interim, said Brad Pacheco, spokesman. He added that in five years, Mr. Gonder was able to build a good team at CalPERS.

“GSA has presented the market place with a powerful new model for both investing with top-tier established funds as well as building high quality new investment teams,” Mr. Gonder said in a Grove Street release. “They are essentially redefining the role and style of the traditional gatekeeper. I believe I can leverage my experience at CalPERS to further define and build out this model.”

This is the second time a CalPERS investment officer has joined one of the fund’s alternative investment managers.

“It’s always a challenge to retain top talent,” Mr. Pacheco said. But he added that a committee of the board reviews compensation of investment officers.

Bob Boldt, who left the fund in May 2000, popped up at a CalPERS’ investment manager’s office this last January. He joined San Francisco-based Pivotal Asset Management, a $750 million money manager that oversees a crossover hedge fund that invests both in public and private companies.

In August 1999, the CalPERS board committed $300 million to the technology-focused Pivotal Partners fund. In May 2000, Mr. Boldt told trustees that he was interested in a job in the private sector and discussed with the press the possibility of joining a hedge fund.

By Susan L. Barreto, Senior Reporter, SBarreto@HedgeWorld.com