Capital Allocators – CIO Greatest Hits: Multi-Family Offices – Stan Miranda (Partners Capital)

Podcast: Capital Allocators – Inside the Institutional Investment Industry
Host: Ted Seides
Guest: Stan Miranda, Co-founder and Chairman Emeritus, Partners Capital
Recorded: 2023, rebroadcast August 25, 2025

Overview

In this episode of Capital Allocators' CIO Greatest Hits series, Ted Seides sits down with Stan Miranda, co-founder and Chairman Emeritus of Partners Capital. The conversation dives into the founding and growth of Partners Capital, the application and evolution of the endowment model, manager selection, risk management, and lessons learned from decades of institutional investing. Miranda shares practical details and candid reflections on building a world-class OCIO business, keeping a client-first focus, the importance of transparency, customizing allocations, and sourcing alpha. The episode brims with insights into best practices for manager due diligence, asset class analysis, organizational growth, and the future of multi-family offices.

Founding of Partners Capital (06:39 – 09:55)

• Origins: Partners Capital was born out of frustration with conflicts, transparency, and poor performance in private banking post-tech bubble collapse.

  • Stan and co-founder Paul Dimitrik, both private equity investors, realized diversification and independent, transparent evaluation were needed.
  • Stan: “It was a wake up call for us that we needed something so desperately and it didn’t exist and so we thought we’d create it. We called it the island of Integrity in the investment management world.” [08:00]

• Early Blueprint: Inspired by Swensen’s Pioneering Portfolio Management.

• Initial Clients: 43 private equity GPs as founding clients, $7.7M starting capital. [09:55]

Early Operations and Scaling the Business (10:05 – 15:41)

• Taking It Slow: Past experience led to a deliberate approach—three employees, focus on “next asset class.”

• Deep-Dive Analysis: Started with a blank sheet for each asset class, leveraging relationships but grounded in original, data-driven work.

  • “We just started from scratch and analyzed it very deeply on each of those.” [11:20]

• Triangulation & ‘Steal from the Best’: Consulted with thought leaders at Yale, Stanford, McKinsey, and other endowments.

• Scaling Up: Reached $100M in year two via a mix of HNW individuals and institutions; methodical growth, capping annual client intake pre-GFC.

• “Customization”: Most clients wanted all asset classes, making customization primarily about sizing and allocation nuances, not product variety.

Endowment Model: Philosophy and Implementation (16:37 – 18:25)

• Three Pillars:

  1. High Static Risk (no market timing, long-term focus)
  2. Multi-Asset Diversification (tilted to illiquids if possible)
  3. Entrepreneurial, Specialist Managers (skin in the game)
  • Stan: “The endowment model in our definition … had three pillars … high static risk, multi asset class diversification … concentrated specialist, entrepreneurial owner operated asset managers.” [17:00]

• Benchmarks: Targeted to beat the best-in-class for every asset class.

Manager Selection: Process and Lessons (18:25 – 28:26)

Three-Key Selection Factors:

1. Reps: Experience and repetition; “Malcolm Gladwell phenomenon.” [18:37]
2. Quantitative Analysis: Factor-based, regression-driven screens to identify true alpha; removes 95% of managers. [25:22]
3. Psychometrics: “Square pegs” – unbalanced, driven, high integrity, force-of-nature professionals.

• Diligence Process: Hundreds of hours, 20+ references, iterative meetings. [27:49]

Memorable Quote:
“The best investors are square pegs… they're workaholics... high integrity, very trustful people. They're forces of nature.” [27:02]

Mistakes & Evolution

• Commodities: Learned that specialization and lack of yield make it a “graveyard of failed investment decisions.” [20:05]
• Public Equity: Alpha generation challenges, factor exposures, migration from value to growth, unique risks in regions/sectors. [21:00]
• Venture Capital: Access to “top” firms is tough; learned to seek emerging managers with “reps” via spin-outs. [24:45]
• “Almost never invest in early stage manager without reps; they've almost always come from another place.” [24:56]

Evolving the Endowment Model: Risk, Tactical Allocation, Data (28:26 – 35:57)

• Risk Management: “You have to go really deep in knowing what you own”—look through to underlying holdings, 16-factor dashboards.
• Dynamic Overweights: Use derivatives/ETFs for tactical counterbalancing; positive side is granular allocation opportunities.
• Static Risk vs. Tactical: Three “layers” control risk:
  1. Absolute risk (rebalance, no timing)
  2. Tactical within asset classes (e.g., emerging markets when cheap)
  3. Micro tactical (e.g., railways, community banks) [30:44]
• Fee Discipline: Seek to pay performance fees solely on alpha; relationship-building provides extra negotiating power as asset base grows.

Quote:
“We show our clients what we call the risk dashboard, which has over 16 different metrics... Odds are when you got an overweight that was unintentional, it goes against you.” [29:39]

Internal vs. External Management & Organization (37:16 – 40:13)

• Preference for No Conflicts: External managers unless not possible; examples like “New World Equity Portfolio”—internal public equities amid COVID when no one else was doing it.
• Co-Investments: Significant allocation today in privates and selective public equities with trusted manager partnerships.
• Specialization Model: Heavy focus on dedicated research teams, each specializing by asset class.

Asset Class Deep-Dives (40:13 – 49:23)

Private Equity

• Focus: Lower middle market buyouts, sector specialists (esp. software).
• Key Return Drivers: Historically, 50% from multiple expansion (public market uplift), 50% from earnings growth/debt.
• Sweet Spot: Fund II & III; prefer to build relationships early and invest in proven spinoffs. [42:51]

Hedge Funds

• Split:
  • Hedged equities (>0.2 beta) – treated like equity
  • Absolute return (low beta): 20+ managers, diversified for stable alpha stream, then levered for target return.
• Avoid: Platform allocators like Millennium/Citadel due to high fees—prefer to invest in their spinouts for better EROC (“Excess Return on Cost”). [45:19]

Alternative Alternatives

• Early moves into insurance, litigation, royalties, clinical trials, sports financing.
• Capacity/Alpha Limited: Good returns, but can’t scale above 5-6% in client portfolios.

Real Estate & Real Assets

• Real estate: Avoid “double promote”; focus on regional specialists/national portfolios; US > Europe/Asia for alpha.
• Real assets: Early commodities exposure taught lessons; now focused on energy transition, not traditional resources.

Innovation & New Asset Classes (49:23 – 51:18)

• AI: Too early to allocate; watching its impact on research and asset allocation.
• Crypto: Only venture capital side in blockchain; direct crypto viewed as speculative (“pricing bears no resemblance to utility”). [50:00]

Scale and Relationships (51:18 – 51:59)

• Growth to $50B AUM has enhanced strategic relationships: “We’re just always the top of their table, and so we get every question answered. We get more transparency.” [51:27]

Succession – Institutional and Firm Level (51:59 – 54:41)

• Manager Succession: Resilient organizations embed processes so no single person’s departure is catastrophic.
• Partners Capital: Built as a broad partnership; succession handled by transferring responsibility gradually, avoiding “big fanfare” transitions.

The Road Ahead (53:54 – 54:56)

• Expect continued measured expansion into direct investing—carefully, to preserve “no conflicts” ethos and deliver more alpha/lower fees where advantage exists.
  • Stan: “There are a lot … I think we’re going to cross that boundary at some time very delicately. … But I think there’s some opportunities our clients should benefit from where they could see much lower fees and a lot more alpha if we integrate forward into asset management.” [53:54]

Rapid-Fire Closing Questions (54:56 – 60:00)

• Hobbies: Endurance sports—triathlon, hockey, racket sports; “I collect sports ... the only one I don’t do is golf.” [55:02]
• Investment pet peeve: “People who mistake alpha for beta.” [55:45]
• Personal pet peeve: Entitlement (“hard work earns you the right”).
• Mistake never to repeat: Catastrophe insurance—“we’re long global warming.” [56:27]
• Biggest influences: Tom Eliason (cardiologist, calm), Archie Norman (CEO, “brutally honest,” face the unvarnished truth). [56:47]
• Parental lesson: Have a skill people will pay for—choose practicality.
• Life lesson: Keep family close; resist the urge to let children scatter across the globe. “You’ll never regret it.” [59:21]

Standout Quotes

• “The most important thing is not just how many mistakes you’ve made, but did you stop, analyze it, codify it and teach it? Did you educate your team about why that was a bad idea?” – Stan Miranda [19:20]
• “Turns out information ratio is probably the most important metric in liquid securities… start with the highest information ratio manager, allocate as much as you think you can.” – Stan Miranda [36:16]
• “If we can’t find it externally, we’re allowed to do it internally.” – Stan Miranda on direct/internal management [37:54]
• “Succession in all companies … is about giving the job to the individual before they take it on. And then it just happens more naturally.” – Stan Miranda [52:59]

Notable Timestamps

• Founding story: 06:39–09:55
• Scaling the OCIO: 12:50–15:41
• Pillars of the endowment model: 16:47–18:25
• Manager selection process: 18:25–27:45
• Risk management evolution: 28:26–30:35
• Portfolio construction with IR: 36:16–37:16
• Team & org structure: 39:00–40:13
• Private equity insights: 40:24–42:41
• Hedge fund allocation: 43:35–46:08
• Alternatives: 46:18–47:19
• Crypto, AI, new frontiers: 49:23–51:18
• Succession planning: 51:59–54:41
• Rapid-fire close: 54:56–60:00

Tone & Delivery

Miranda is frank, practical, and intellectually rigorous, blending humility with conviction from decades in the field. Ted Seides’ questions draw out depth and candor, making the episode as much a master class in institutional investing as a personal reflection on building a legacy.

Summary

This episode is an essential listen for asset allocators, family office professionals, and anyone grappling with how to scale investment acumen while maintaining integrity and delivering results. With a blend of operational, philosophical, and tactical insights, Stan Miranda offers a rare window into the processes, mindset, and values behind one of the world’s leading multi-family office OCIO platforms.