Scott Chan

we were able to gain economics in those funds as well. In this case, we had a revenue sharing arrangement. So if you think about every part of the return distribution, you know, because it was direct lending, we're penciling out, well, we're getting on low teens on our investment.

we were able to gain economics in those funds as well. In this case, we had a revenue sharing arrangement. So if you think about every part of the return distribution, you know, because it was direct lending, we're penciling out, well, we're getting on low teens on our investment.

we were able to gain economics in those funds as well. In this case, we had a revenue sharing arrangement. So if you think about every part of the return distribution, you know, because it was direct lending, we're penciling out, well, we're getting on low teens on our investment.

And as that fund grew, because we're sharing the revenue, as long as the returns were positive, we're going to generate, you know, 3% to 8% additional IRRs given the economics that we're sharing by anchoring the funds with them.

And as that fund grew, because we're sharing the revenue, as long as the returns were positive, we're going to generate, you know, 3% to 8% additional IRRs given the economics that we're sharing by anchoring the funds with them.

And as that fund grew, because we're sharing the revenue, as long as the returns were positive, we're going to generate, you know, 3% to 8% additional IRRs given the economics that we're sharing by anchoring the funds with them.

And so if you think about it from that perspective, yeah, we had the operational risk of how do we structure this, the legal costs of making sure we had the right vehicles and structures. But at the end, we have the potential of adding 3% to 8% IRRs on top of the IRRs that we expect. And that could be a considerable amount of value for CalSTRS.

And so if you think about it from that perspective, yeah, we had the operational risk of how do we structure this, the legal costs of making sure we had the right vehicles and structures. But at the end, we have the potential of adding 3% to 8% IRRs on top of the IRRs that we expect. And that could be a considerable amount of value for CalSTRS.

And so if you think about it from that perspective, yeah, we had the operational risk of how do we structure this, the legal costs of making sure we had the right vehicles and structures. But at the end, we have the potential of adding 3% to 8% IRRs on top of the IRRs that we expect. And that could be a considerable amount of value for CalSTRS.

That is the case. And again, it's one of the keys, and you'll see this in our numbers, that we're not taking additional market risk and generating, I think, uncorrelated alpha on top of that. And again, I recognize that it brings some additional operational risks. We've spent a lot of time mitigating that with our expert staff and and increasing resources.

That is the case. And again, it's one of the keys, and you'll see this in our numbers, that we're not taking additional market risk and generating, I think, uncorrelated alpha on top of that. And again, I recognize that it brings some additional operational risks. We've spent a lot of time mitigating that with our expert staff and and increasing resources.

That is the case. And again, it's one of the keys, and you'll see this in our numbers, that we're not taking additional market risk and generating, I think, uncorrelated alpha on top of that. And again, I recognize that it brings some additional operational risks. We've spent a lot of time mitigating that with our expert staff and and increasing resources.

In the time we were accelerating the cloud model, think back in 2017, we had a run rate of 106 cloud model transactions. In 2023, we had a run rate of 425 cloud model transactions. So we've really accelerated that. What has that done to return on risk? Well, If you think about the cost savings, we estimate greater than $2 billion in cost savings over the last six years.

In the time we were accelerating the cloud model, think back in 2017, we had a run rate of 106 cloud model transactions. In 2023, we had a run rate of 425 cloud model transactions. So we've really accelerated that. What has that done to return on risk? Well, If you think about the cost savings, we estimate greater than $2 billion in cost savings over the last six years.

In the time we were accelerating the cloud model, think back in 2017, we had a run rate of 106 cloud model transactions. In 2023, we had a run rate of 425 cloud model transactions. So we've really accelerated that. What has that done to return on risk? Well, If you think about the cost savings, we estimate greater than $2 billion in cost savings over the last six years.

And I love that because I think every successful corporation or business, they should have that mentality of like, how can I deliver a streamlined, more cost-effective business like a Costco? Delivering value to the clients. We're delivering those costs right to the teachers, bottom line. On the flip side, you don't want to be penny wise and pound foolish.

And I love that because I think every successful corporation or business, they should have that mentality of like, how can I deliver a streamlined, more cost-effective business like a Costco? Delivering value to the clients. We're delivering those costs right to the teachers, bottom line. On the flip side, you don't want to be penny wise and pound foolish.

And I love that because I think every successful corporation or business, they should have that mentality of like, how can I deliver a streamlined, more cost-effective business like a Costco? Delivering value to the clients. We're delivering those costs right to the teachers, bottom line. On the flip side, you don't want to be penny wise and pound foolish.

Every time we are doing the collaborative model, we have to think about it from the perspective of would we just be better off as an LP and a fund for folks with a competitive advantage? Would we have a sourcing advantage with them? Can we add additional value to it? And if you look back, we've had one of the strongest periods of alpha generation.

Every time we are doing the collaborative model, we have to think about it from the perspective of would we just be better off as an LP and a fund for folks with a competitive advantage? Would we have a sourcing advantage with them? Can we add additional value to it? And if you look back, we've had one of the strongest periods of alpha generation.