There has never been a greater need for long-term investments to tackle the world鈥檚 most difficult problems, such as climate change and decaying infrastructure. And it is increasingly unlikely that the public sector will be willing or able to fill this gap. If these critical needs are to be met, the major pools of long-term, patient capital鈥攊ncluding pensions, sovereign wealth funds, university endowments, and wealthy individuals and families鈥攚ill have to play a large role. In this accessible and authoritative account of long-term capital investment, two leading experts on the subject, Harvard Business School professors Victoria Ivashina and Josh Lerner, highlight the significant hurdles facing long-term investors and propose concrete ways to overcome these difficulties.
Presenting the best evidence in an engaging way by using memorable stories and examples, Patient Capital describes how large investors increasingly want and need long-run investments that have the potential to deliver greater returns than those in the public markets. Yet success in such investments has been the exception. Performance has suffered from both the limitations of investors and the internal structure of their fund managers, often resulting in the wrong incentives and a lack of long-term planning.
Yet the challenges facing long-term investors can be surmounted and the rewards are potentially large, both for investors and society as a whole. Patient Capital shows how to make long-term investment work better for everyone.
Victoria Ivashina is the Lovett-Learned Professor of Finance at Harvard Business School. Josh Lerner is the Jacob H. Schiff Professor of Investment Banking at Harvard Business School and the author of, among other books, Boulevard of Broken Dreams: Why Public Efforts to Boost Entrepreneurship and Venture Capital Have Failed鈥攁nd What to Do about It (Princeton).
"Few scholarly, well-researched books have been written on long-term private investing. Victoria Ivashina and Josh Lerner have undertaken a real public service in writing what will undoubtedly become the definitive book on the subject. My only regret in reading this book is that I did not write it."鈥擠avid Rubenstein, Co-Founder and Co-Executive Chairman, The Carlyle Group
"You may not think your life depends on long-term investors, but it does鈥攖he health of your company's pension plan, your state or country's social security fund, indeed the very comfort of your retirement, depends on the success of long-term investing. In this very readable book, Ivashina and Lerner, two of the foremost experts on the subject, tell you what is going wrong, and how to set it right. It is a must-read for every anxious investor and every concerned taxpayer."鈥擱aghuram Rajan, University of Chicago
" 'The trees that are slowest to grow bear the best fruit,' Moli猫re says. And that is why this lucid and refreshing account of how to overcome the barriers to long-term investment deserves the attention of pension funds, insurers, sovereign wealth funds, and endowments. After all, the potential fruits are not just quality returns, but significant benefits to society."鈥擠ominique Senequier, President, Ardian
"The antidote for short-term horizons in public markets is long-term investment in private markets. In Patient Capital, Ivashina and Lerner survey the private equity world, employing an engaging combination of captivating anecdotes and solid academic research. A must-read for all who care about the future of capitalism."鈥擠avid F. Swensen, Chief Investment Officer, Yale University
鈥淭his book provides a thorough and thoughtful analysis of the role that patient, long-term capital plays in the economy. Ivashina and Lerner do a wonderful job of combining clear and intuitive explanations with entertaining anecdotes that keep the reader鈥檚 attention and make it easier to understand the underlying ideas. At every point their in-depth knowledge shines through and makes for a very enjoyable read.鈥濃�擜ntoinette Schoar, MIT Sloan School of Management
鈥�Patient Capital is a compelling and thought-provoking book about an important but poorly understood aspect of finance鈥攖he role of long鈥恡erm investors in our capital markets. It will appeal to finance scholars; those who work for pension funds, endowments, insurance companies, sovereign wealth funds, and the venture capital and private equity industries; and entrepreneurs who rely on them for financing.鈥濃�擩effrey R. Brown, Dean of the University of Illinois鈥檚 Gies College of Business and Investment Committee Chair for TIAA
