“John brings to investing a distinctive combination of analytical rigor, creative problem-solving, and a keen focus on people. These traits have supported his success across a wide range of responsibilities. He is equally adept at uncovering intriguing new investments around the globe, helping our partners design new fund structures, or providing mentorship and guidance to our own team members. And John does it all with patience, good humor, and a strong belief that a university like Penn can make a positive difference in the world.”
—Peter Ammon, CIO, Penn Office of Investments
“I’ve always been passionate about investing,” said John F. Roberts, CFA. After graduating from Colby in 2009 with degrees in math and economics, he started his career at Barclays, where he had interned the prior summer. He joined a quantitative analytics team in the investment banking division, and worked on such topics as modeling the diversification benefits of mergers and acquisitions (M&A); simulating future liquidity needs; and building holistic hedging strategies across rates, foreign exchange, and commodities. Then it was on to Goldman Sachs, where he went into a similar, as he put it, “client-facing quant” role.
After reading a book by David Swensen, the legendary chief of Yale’s endowment, Roberts realized that this was the area he wanted to dedicate his life to. He joined the Penn Office of Investments in 2015, as it was building out under new CIO Peter Ammon, who had worked at Yale under Swensen. At the University of Pennsylvania, Roberts focuses on private equity, leading up the office’s sourcing efforts in Europe. “I like to take the long view,” he said.
CIO: How would you deal with rising inflation and interest rates?
Roberts: A portion of Penn’s endowment is invested in real assets, which should perform well during a period of unexpected high inflation. Within the private equity portfolio, where I focus, our goal is to partner with exceptional managers that can generate strong through-cycle returns. This long-term focus allows us to prioritize partner quality over short-term tactical considerations, such as inflation risk.
CIO: What is the best way to bring more diversity to the financial industry?
Roberts: That is a great question without a simple answer. Increasing diversity within the financial industry will require a multi-pronged approach by both GPs [general partners] and LPs [limited partners]. GPs need to increase their efforts to recruit junior investors and to make sure they receive the needed mentorship and opportunities to excel within their organizations. Investing is an apprenticeship business, so it is critical that the industry pushes itself to make these opportunities available. LPs in turn need to push themselves to make sure that they are taking similar efforts to promote diversity.
CIO: Is cryptocurrency a flash in the pan, or an asset of lasting value?
Roberts: The crypto ecosystem appears to be here to stay given multiple signs of product-market fit beyond a non-sovereign store of value, such as decentralized finance (DeFi) and nonfungible tokens (NFTs). As new use cases like NFTs emerge, they increase crypto adoption by bringing new cohorts of individuals into the crypto ecosystem.
CIO: How will the pandemic have changed the economic/financial world?
Roberts: One area that may change due to the pandemic is how organizations think about work from home and travel. While there is no substitute for in-person time as a team and with partners, it is hard to dismiss the efficiency gains of videoconferencing and other remote work tools that we are now accustomed to using.
CIO: What place does blockchain play in tomorrow’s financial scene?
Roberts: One role blockchain technology will continue to play is pushing innovation within our existing financial infrastructure. Settlement speed is a good example of where blockchain technology is currently ahead. The FedNow program that the Federal Reserve intends to launch in 2023 to provide partner banks with the ability to provide instant payments, however, could help close that gap.
CIO: How will ESG change investing going forward?
Roberts: As large corporates embrace ESG [environmental, social, and governance approaches], it is becoming increasingly important for investment firms to incorporate ESG into how they evaluate, operate, and position business for exit. Even if a firm does not intend to directly sell into this buyer universe, it is likely targeting buyers who will want to preserve that optionality for themselves.
CIO: Where do you see the most exciting areas to specialize further over the coming years?
Roberts: For an area to be worth specializing in, it should be difficult for generalist investors to analyze and access, have a broad and rich opportunity set, and have strong tailwinds that are likely to persist. There are several verticals and geographies that fit these criteria today, such as life science investing.
