The Structural Gap Traditional Wealth Management Left Open

Del Buono’s critique of traditional wealth management is quite deep. Conventional firms charge a flat assets-under-management fee, which rewards scale and simplicity. The rational response for those firms is to build straightforward stock-and-bond portfolios rather than invest in the specialized teams needed to access alternative asset classes. Del Buono characterizes the product as “mostly retail product but with a veneer of very high-end service.”

When those firms do reach for alternatives, they typically use a fund-of-funds wrapper, which layers a second set of fees on top of an already expensive structure. The client absorbs both.

The obvious alternative is a single-family office. Del Buono advises against it. Running a credible multi-asset-class portfolio requires a team of specialized, highly compensated professional investors. A balance sheet in the billions is generally required to justify that compensation structure. Beyond the cost problem, single-family offices struggle with talent retention and frequently collapse entirely when the founding patriarch or matriarch dies.

His advice on concentrated stock is neither to hold indefinitely nor to liquidate immediately. Perennial constructs options programs that allow clients to monetize the natural volatility of a concentrated position over time, capturing income from that volatility while maintaining long-term exposure. The goal is gradual diversification without surrendering upside prematurely.

On the secondary market for private company shares, Del Buono is blunt. Multi-layered SPVs (Special Purpose Vehicles) sold to retail and near-retail investors as access to companies like Anduril often carry steep fees, provide limited investor control, and in some cases are outright fraudulent. He recommends extreme caution with any secondary SPV structure that is not direct.

Venture Capital: Manager Selection Matters More Than Exposure

Among all major asset classes, Del Buono identifies venture capital as having the widest dispersion of returns. In most asset classes, the gap between a median manager and a top-quartile manager is meaningful but not dramatic. In venture, the difference between investing with top-tier managers and everyone else is the difference between exceptional returns and permanent capital loss. Getting exposure to VC as an asset class without access to the right managers is, in his framing, a trap rather than an opportunity.

This argument is well documented in the academic literature. Research from Cambridge Associates and Kauffman Fellows has consistently shown that the top decile of venture funds captures a disproportionate share of total industry returns, and that those returns are driven by a small number of outlier outcomes.

The Most Common Founder Mistake After A Liquidity Event

When asked what newly wealthy founders most frequently get wrong, Del Buono’s answer is specific: they take the majority of their first liquidity event and immediately invest it into early-stage startups run by their friends and network. The reasoning is understandable. Having just succeeded themselves, founders have difficulty internalizing how frequently startups fail. The result, in his words, “almost always ends in tears.”

For founders who want venture exposure, Del Buono recommends a systematic approach over discretionary angel investing: defined allocation sizes, consistent entry criteria, and portfolio construction logic rather than relationship-driven check-writing.

The Hiring Philosophy A16Z Applied To Its Own Office

Del Buono closed the interview with a reflection on what he learned from Andreessen and Horowitz about talent. The firm’s approach is not to hire candidates with few weaknesses, but to hire for exceptional, specific skills. Identifying and leaning into distinctive strengths rather than trying to correct deficiencies is the orientation Del Buono credits with building the team a16z has assembled.

That philosophy extends to how Perennial constructs its own investment team and how it advises founders to think about building organizations after liquidity, when capital is no longer the binding constraint.