Episode summary
How the Former CalPERS CIO Built a High-Performance Investment Culture
How I Invest With David Weisburd
· · 42 min · Hosts: David Weisburd · Guests: Nicole T Musicco
Summary
Nicole T Musicco describes moving from Ontario Teachers’ Pension Plan to CalPERS as a chance to bring a Canadian-style governance model and total portfolio mindset to the largest pension fund in the United States. Her core argument is that the real work was not changing labels on asset classes, but changing culture: breaking down silos, improving accountability, and making the organization think like owners rather than allocators.
She says the shift started with a long listening tour during COVID, when she used the quieter environment to see where processes were creating “sand in the gears.” From there, CalPERS brought asset-class leaders into the same rooms for investment, risk, and even administrative decisions, while also pushing for clearer delegated authority, more transparency with the board, and compensation tied more closely to performance.
Musicco also argues that large pools of capital can create structural alpha through better partnerships and lower fees. She says CalPERS leaned harder into high-conviction private equity relationships, co-investing, and selective credit opportunities, while also backing initiatives such as energy transition and diverse managers. That same framework shaped Square 9 Capital, where she says the firm focuses on complex, valuation-opaque credit situations that need private-equity-style underwriting.
Key takeaways
- Nicole T Musicco says CalPERS’ real transformation began with culture and governance, not a formal rebrand to TPA.
- She argues that bringing asset-class leaders together improved accountability and reduced the “sand in the gears” created by silos.
- Musicco says board trust came from transparency, shared objectives, and educating the board before asking for more delegated authority.
- She believes programmatic co-investing and tighter GP selection can create structural alpha through lower fees and better partner economics.
- At Square 9 Capital, Musicco is focused on complex private credit situations outside regular-way sponsor-backed lending.
Notable quotes
“I really have always just been very missiondriven. I'm I'm very inspired by the notion of being able to invest and then knowing that it's bettering or giving, you know, folks a retirement with dignity”
“I really started with a big listening tour. I know that phrase gets used a lot, but I genuinely just walked the halls for the first, you know, 90 days”
“we decided that we really should have all the asset classes in the room for, you know, in an investment committee type approach as opposed to having the private equity investment committee”
How the episode opens
Nicole, I know this term gets used a lot, but you truly have one of the most prolific investment careers in the industry and you went from Ontario teachers pension plan to becoming the chief investment officer of Kalpers. What made you want to take that jump?
I had a slot in between as well as a GP. So, I I think you know the best way to articulate is I really have always just been very missiondriven. I'm I'm very inspired by the notion of being able to invest and then knowing that it's bettering or giving, you know, folks a retirement with dignity, if you will.
And I I think that's just because I spent almost 17 years at Ontario Teachers. And so when this opportunity came along to join really the largest pension in the US, but also one that's been quite storied and extremely complex, I really got excited just about the idea of being able to bring that toolkit of experience that I had sitting in what I think is still one of the most uh innovative certainly for its time. Um, and I can touch on that a little bit later, what made it so innovative, but coming from the learning I had from the very earliest days of my career from at Ontario Teachers and being able to bring some of that Canadian style of governance and total portfolio approach, if you will.
I thought, you know, what a great time in my career to do that. So, I went I jumped in, you know, FIFA, super excited to take that on. And you brought this total pro portfolio approach TPA from the Canadian style to the largest pension fund in the United States.
How were you able to get an organization to change that was just so vastly large like Kalpers and double click on exactly how you went about implementing?
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- total portfolio approach
- pension governance
- investment culture change
- co-investing strategies
- private credit and private markets
Companies and tickers mentioned
- Square9 Capital
- CalPERS
Watch the episode
Watch “How the Former CalPERS CIO Built a High-Performance Investment Culture” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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How I Invest With David Weisburd, this episode and its artwork belong to David Weisburd. Octagon is not affiliated with the show; this page is an independent summary.
