OKLAHOMA CITY – The $1.1 billion Oklahoma Police Pension & Retirement System has for the first time carved out $15 million to $17 million of its assets for venture capital investing and plans to hire two or three alternative investment managers early this year.
The pension issued a request for proposals for fund managers in November, and responses were due as VCJ went to press. The system used its adviser, Asset Consulting Group, to help with the search, said Robert Wallace, Oklahoma’s executive director.
The pension adopted an alternative assets class some five years ago and set a 5% target about three years ago, Mr. Wallace said. Oklahoma has invested in managed futures, distressed debts and timber. Venture capital was added based on research by Asset Consulting concluding that private equity would diversify the pension’s portfolio, Mr. Wallace said. “It was a piece of the overall picture that was missing,” he explained. “This is part of an ongoing process to find the right [investment]mix. We are really trying to fill the private equity piece at this time.”
The pension first issued an RFP about four years ago seeking private equity investment professionals but was unsuccessful in its search, Mr. Wallace said.
Oklahoma plans to invest small amounts of capital in venture partnerships. “We don’t want to put all eggs in one basket.” Commitments likely will not exceed $5 million, and there are no sector or geographic restrictions, Mr. Wallace said. Each new manager would have approximately $5 million to $7 million to invest.
Capital for venture investments will come from reductions in domestic equities investments.