YouSaid · the spoken record

Mathieu Chabran

lines on the record: 71
first: 2023-06-09
most recent: 2023-06-09
sittings or episodes: 1
sources: podcast

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“Well, I would send him some of the motos where using everyday Article Capital. Be curious, think out of the box, be on the ball, think big. I will share that with them because that's one thing that doesn't change. Technology may change, but interpersonal skill set and being hungry. I think that's what matters.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So, two books I've started very different. The first one I was Even if it's 50, 75 years from now, I think we should start factoring in many of that in today's decision. And the other book, more recent, I was lucky to meet a French professor in Boston who's a teacher both at HBS and HKS. She's been there for 20 years. Her name is Julie Batilana. And her last book is called Power for All. And it's all about the relationship to, I wouldn't say even power, but if effectively power is about having an influence on making someone else change behavior, how it's not only top down and the way we may have learned it and how we should, with the new generation in a new cycle and the perspective of things that are critical to me, which are democracy.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Few of them are senior people I worked for when I was a young analyst and an associate. Because every one of them in their own different approach helped me challenge the fact that we are going on our own at a relatively young age for this business, some of them telling us, well, it's either too late or too early for good or bad reasons. And on the contrary, people saying, which was less the case in Europe than it can be the case here in the US, there's never a good time and you should give it a go. And so many of them were finance professionals, most of the time in investment banking and I've still remained friends. Some of them join us, by the way, along the way at TKO. And that's one thing that obviously was very valuable when you start your own venture.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“One I like and I recommend, but because that's been produced by this company we backed that we helped take public a few months ago is the picky blinders. That's great entertainment, not only because I love this whole story about the VLAN and the gangsters and all that, but more importantly because that's great. Is that network?”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Kong, from part of the Middle East to open there for the very same reason that you have created a great talent hub, a very business-friendly environment. You've got the most sophisticated sovereign wealth funds in the world. We were lucky enough to have Temasek backing us as early as 2016. It's been a great partner ever since. Great place, great marketplace. And so the way we look at our thing appropriate operations today, we have a headquarter, Paris, and we have three global hubs, New York, London, Singapore. And out of these hubs, then you can reach on a global basis first investors and effectively attracting them where we think there is an interesting investment proposal and also creating investment opportunities when you've got this supply demand imbalance. Again, it all comes down to supply demand and how we can best take advantage of that.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So, what we've been doing in Asia first out of Singapore, where we started eight, nine years ago in Singapore, and then Korea and Japan, we don't have any presence in China, as a matter of fact. And the dialogue we had with these investors locally was really about attracting them to some of our existing strategies in Europe or in the US. Asia is, I have the chance to go back there from time to time, and each time I'm there, I found local economies that have been transformed. If you look at Singapore, what it was when we first moved there, eight years later, that's a global hub, like a global hub with all the consequences you're reading every day, you know, the Bloomberg News, the price of real estate and the numbers of family offices who moved from Hong Kong.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Overnight, but you can make it happen fairly quickly, fairly quickly being a matter of months. If you've got all these stars aligned from the political direction to the population adhesion and then the capital allocation. And so I'm hopeful and I'm optimistic that that could be the silver lining of the whole situation as dramatic the situation can be.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So not dissimilar to what we're experiencing here in the US on the re-insuring of production capacity. We're seeing that in many countries across Europe. Re-industrialization has been probably the most popular world of politicians lately, not only because you need to demonstrate less dependency to outside markets, the whole deglobalization theme. I think it was accelerating by this whole situation. And so for politicians, it's a way to show a direction for the population. It's a new paradigm, a new software. And coming back to what we do for a living, asset manager, it's a great frame in finding ways to allocate, reallocate, working with global investors to attract more capital in certain countries for certain industries.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a complicated one, it's a very sad one because what I can tell you, Barry, is sitting here in the US and when I talk to France, family over there, the perception of the war is very different from one side to the pond to the other because the reality that it's, as we know, it's Political willingness to move quicker. And the response, if you remember that the European government made right after the war, I mean, they made more progress in a matter of a few weeks than we had in a few years. And so at times it's effectively when the essential is at stake that people can react constructively.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“And that's why if I'm a bit selfish in the approach, we were fully equipped on the continent to start with. We're now moving back more aggressively into London because we were less overexposed when many people are doing the contrary. People are trying to reduce their investment allocation to the UK, their workforce in the UK. So we're trying to be a bit contrarian and taking advantage of that.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Why that? Because London remains a critical business centre for financial services. There are some challenging associated with some regulation in the way you have to trade and why people and banks had to open or export some branches onto the continent. And I understand why. And that technicalities. But when it comes to the cosmopolitan nature of London attracting global talents and as much as, I'm French and Paris has been doing a tremendous job in an attracting talent and firms, but the scale is such that I wouldn't bet against London as a financial center. So we have to cope with technical aspects. Regulation, cost of doing business for some has become very punitive if you don't have the scale.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So, first of all, that's a decision that was made by the British people. And I will not comment on the rationale beyond that. I read the same studies that you mentioned. And every day I would talk to some France entrepreneurs in New York in Europe telling me how challenging it has become, you know, just to move goods and things into and just trading with the UK. The one part I can comment on was the whole debate around the future of the city of London as a prominent financial place, global but obviously European. What I can tell you, Barry, is since the world reopen and you can travel again, I'm actually going back more often to London than to Paris nowadays, which is the headquarter of my firm.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“I think so. And so that was just, I think, a misuse of an interesting technique with some investors and a misuse of interesting techniques for the wrong company.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, the technology itself was excess of cash, you know, interest rates are at zero, I get negative cash, negative interest on my cash account. So here's the cash and I may opt out. What we try to do in what we did and some work, although we decided to give back the capital because back to my skin in the game approach, the one we decided to return the capital that was last month, we had 150 million plus of our own capital committed to it. So rather than chasing the cheap option with the view of hopefully making the return embedded with the option, we're like, first and foremost, we're deploying our capital. If the opportunity is not there, we're not going to deploy our capital for the sake of it.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“A real company, our spec is doing at, I guess, 10 bucks or around real company. So the issue was not the SPAC as a technology. The issue was, you know, the type of company that were trying to access this market opportunistically, and rightly so, in front of some capital that had been given to SPAC's promoters and managers. Remember that interest rates were negative. So, you know, SPACs were used by some investors as a vault. Here's some cash.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So we got into Spax two years ago, hopefully not too. A very useful technology that could help some of our private companies, which is what we do, the bulk of what we do is investing with private entrepreneurs, accessing the public market with the support of experienced managers, the operating partners, with the support of experienced financial players. And effectively, we very successfully unspacked some. We took public on Euronext Amsterdam, a great company in the TV content production business, 3 billion turnover, 600 million EBDA. It's called FL Entertainment, great entrepreneurs, Stefan Kobi.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“For everyone. Exactly. And that's 10 years, if not more. And some of us, I think had effectively lost sight that liquidity should have a price and credit has some value. And so effectively, this comment I made was that, yes, people are going to have a hangover of this mispriced over-leveled asset they may have bought, invested into. As a consequence of this free liquidity.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, that was, you know, I think that was at Milken's Institute in May 22. And that's when the interest rate started to raise. And I think I was telling you earlier, I was surprised to see that many people surprised because effectively the bar had been open for quite a long time with very cheap liquidity, if I may say available. And”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Maybe that's my point, they should be known and they are known. But, you know, there's, you know, people at times are a little bit reluctant or resistant to change. And so if that is something...”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“To the deal flow. And here again, at first people were maybe looking at us like, you know, why do you need to bring a corporate? Are there some conflict of interest involved here? And then a few years down the line, they're like, well, that's a very different proposal that we may have heard from other managers and there are plenty out there.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“We did that in the aerospace cyber with a bunch of prominent European and global players such as Airbus, DASO, Saffron, Tales, bringing obviously some capital, but more importantly, some skill sets, some knowledge, some reach, so that back to my create not compete, we can tell a different story with investors. And as you just mentioned, the last one with Unilever is the same exactly the same approach, which is bringing additional expertise alongside an asset manager, us, financial investors, and there's no shortage of capital, as we said, you know, out there. In that case, one of the largest European insurance companies, if not global, and having together a different proposal fully align with some complementary sourcing to the”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So one comment as an aside is Atico we've always partnered with, or we try as much as we can to partner with corporates. To bring additional skill set. We did that in energy transition, for example, with total energies very early on, 17-18.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“of this small meatcap market that doesn't have an even more so going back to your comment about the regional banks, you've got part of the financial market structure which is disappearing and so you need the alternative source of capital and so that's where we can be a very relevant tool and that's for the companies and the investors also want to allocate there.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Technique, you know, it's not really the agri tech, as you may be used to, but some techniques have been proven and need this capital to scale. And this capital would not be available otherwise because it's not about buying land or acres or forest. It's not about the agritech which is effectively attracting a lot of capital. But these entrepreneurs, these small cap businesses with a proven concept and profitability, and they need this capital to scale. So you would be investing 20, 30 percent, taking 23% of the company, investing this capital to effectively help scale the business to a size where then you can get to more banking financing, capital market, which is not that open. So it's this whole band, so it's certainly the case in Europe. We see it more and more here in the US.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“It's the whole chain. I mean, it's the fact that soil goes without saying is a scarce resource that needs to be maintained in a way to be able to keep on producing in a way that for the next generation you don't look back and you leave a brown soil full of fertilizer or others that will not be able to generate the same quality of product for the future generation at a time where you'll have to feed much more people. So the technique here very similar to the climate approach we took five years ago is really about finding entrepreneurs and the companies who have a solution for soil effectively fertility let's say or some”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“People would realize that it's not, it shouldn't be a political game. I understand why I'm not naive. I understand why, but I think the majority should prevail to understand that the asset owners today, the asset managers who can help them deploy the capital, have an historical mission because we will be judging up 50 years down the road. I mean, people will look back and say, you know, what did you do with the amount of capital that was available back then to effectively direct this capital to wearing up, to where it matters? So I'm trying to take this perspective because effectively we've never been in an environment with so much cheap liquidity that could be used purposely.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm not surprised because, and again, I'm an alien here, but I try to be an observer of the dynamic of the politics here in the USA. And we even experimented that ourselves. Some of our LPs very often made up of different boards, some teachers, firemen, policemen, employees, public servants, employees. Whilst we were dealing with the same counterparty, the same pension fund, some of their constituents, some of the underlying boards disagree on the approach to take there. So we've experienced that firsthand that within one given investor, asset owner, there could be some divergence. And very often now I can say because there was a bit of misunderstanding Of what we were trying to do and what others are trying to do. So I'm hopeful that with a bit of education, the science-based”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“And in both situations, it's not good. And so our colleagues, our staff, our people and all the stakeholders, I mean, they are the guardians, they're the stewards of us being real here. So again, now it's no longer a nice to have, it's a must-have and there's only one way.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So you can demonstrate that it's not about being a philanthropy, it's about making sure that we use the capital available to send it where it makes sense and then all stakeholders benefit from it. And so as much as five years ago, it was nice to have and once again create, not compete, we're trying to push that forward. Today it's non-negotiable. It's not negotiable with RLPs. It's not negotiable with our customers, with our partners, with our banks, with our clients, with our staff, Barry. I mean, when we talk to some of our 20-something, 30-something colleagues, professionals, it's part of their Commitment to the firm because one big issue in this when it comes to this impact and ESG, let's say in the wider sense, at best you can come across very opportunistic. At worst, you'll come across as fake”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Some private credit impact financing. What does that mean? You're a borrower were lending you some money at five percent, you're three times in a BDA we take all the traditional credit metrics of a financial analysis and then we add a third dimension. If you hit certain target, certain goals, extra financial goals, then you will improve your cost of funding. And your 5% coupon will go down to four if effectively you demonstrate that you reduce by x or y or change this production process. And all of a sudden you realize that if your cost of funding goes down, As a consequence of some extra financial goals being met, well your return on equity goes up”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“companies making twenty five fifty million a BDA and needed capital in, those guys are not looking to sell their company. They need the capital in to scale. And we started doing that across low carbon mobility, across energy efficiencies of the buildings. As you know, it's 40% of the green gas emission. And so we started doing that, I would say, naturally. Five years later, we now can represent effectively the case studies. Obviously, the track record, it matters, but people want to understand what we're talking about when we're talking about this type of impact investing. Here it's about climate. We then launch regenerative agricultural strategy because one of the key objectives is how do you capture carbon? And there's nothing like the soil and the ground to help do that. That's on the equity side. And then we started doing...”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Started doing that because in Europe we've been investing alongside entrepreneurs, families, as I said, we're not a buyout shop. We don't take control, we don't lever up company. We're trying to, in our role of the middleman between the asset owners and the companies to allocate where we see a financial play, but an impactful financial play. So when we started this strategy in 1718 and started allocating capital, investing in entrepreneurs who had a solution that had to be massified. Because when you want to meet this target and these goals in terms of climate of CO2 reduction, it's great to be investing in what will change in 20 by 2050, but it's more important to find what works today and needs to be massified, scale up. We're investing in profitable mid-market.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“I think we were relatively early in what has become a very mainstream strategy, rightly so. And that was really a combination of many factors. We launched our very first growth, equity, growth private equity strategy in 2017-2018, way before it has, as I said, become a must-have strategy for many managers and for many allocators.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Maybe I will exit the strategy, I'll be at a discount, the lowest possible, but the proceeds will be able to be reinvested. All asset owners, asset allocators, the one can be nimble, it's a very exciting time ahead.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Now can be 8 to 10. And so when you start compounding your new allocation into these type of strategies, that can make up for the part of your portfolio, which itself could be a little bit underwater as a consequence of those rising interest rates, again, credit, real estate, what have you. So that's the positive. You have to be able to do that, right? So how do you do that? I mean, if you have effectively the denominator's effect that people have been talking about or more liquidity constraint because cash is not coming back as quickly as you had anticipated because your managers cannot sell their portfolio or something. The second remarket has been developing like crazy on the private equity, for example. They said private credit is another one. Real estate will be an obvious one given the amount of capital out there. And so it's about being prepared to say, okay, I've been making five, six, seven percent on this strategy.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, on the regional bank, I'd rather not comment. I'm not an expert. It came as a fact, you as a surprise how quickly large, very large institution could get into some liquidity stress. Coming back to my comments, again, it's your liability side. And there's been plenty of comment there. What I see is that, once again, for asset managers, it's very interesting structural opportunity because it creates a bit of void in terms of the market that we can fill in in some way, shape or form. So I think that on the positive side, investors allocators today they can effectively allocate capital into strategies which will create a compounding effect to their portfolio. Because what was, I don't know, 3%, 4% in some strategies two years ago.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“If I may say. I have the impression that the US will be more realistic in the way they approach that in terms of taking the heat, taking the pain, starting again. In Europe, maybe there's a little bit of a pretend and extend game, but it's always better to, you know, what has to be done ultimately should be done immediately.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“2008, where the risk was concentrated on banks' balance sheet, today is much more spread across, let's say, asset managers. But you have to find a way to dry up all this excess of liquidity, which was necessary on the one hand, but maybe mispriced on the other hand. And so today, I think that part of the IG fixed rate corporate bond market, obviously part of the real estate, and we've been talking at length about that, we'll have to suffer some of the pain or losses in some way, shape, or form. As always, on the other side of this trade, that will create great opportunities for people liquid, nimble, who don't have to carry age inventories.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Mispriced, overlevered assets out there. Corporate credit was one, obviously the bonds. I mean, the sovereign bond market, and we remember the SVB story. It's about T-bills. And then obviously the real estate, many areas that were over-leveled at the wrong cost. And that could be painful because someone will have to take the pain, even if unlike...”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Maybe because I come from a leverage finance background, as I told you, I tend always to focus on the downside. But I also learned along the way that you rarely die, I mean, as a company, from your P&L or from your assets, but you always die from your liabilities. And I think that effectively this excess in very cheap money, this excess in leverage, the success in thinking that you could access unlimited for an indefinite period of time of cheap to free capital may have created some the wrong asset allocation pattern in some places. So I think we've now entered a period where we have to swallow this whole”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Investing a billion dollars, you know, be a private investor or a large institutional investors, is that there is the appropriate risk return associated with the strategy that is being implemented. That was very complicated to do in the zero interest rates environment because everyone through the diocese, and it was a double six, because you can only make it right when money is free. Because when money is free, investment has no merits. And now that we are in a situation where money has some value, then you can be discriminating. And that should benefit again the one individual saving a dollar or the one institutional investing a billion. And that in that respect, regardless of this macro situation, if I come back to our role as asset managers, that's where we have a role to play.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, you're absolutely right. But by the same token, we know that right now, I'm not an economist, but in the US, in Europe, the inflation, the structural inflation, people might have a different view about that is certainly hurting the one with the less resources, obviously. energy housing. I'm not even talking about school, healthcare, and obviously in Europe we have a totally different environment about these matters. So it's a tricky situation. And where I think asset managers have a role to play is in making sure that whenever someone is saving a dollar,”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“There, but the institution maybe should be a bit bolder in the way you're tackling this inflation issue. Because we all know that period of very low interest rates create massive inequality. Inequality between people having access to credit and the people who don't have access to credit. And when I say people, it's individual, it's corporate, it's states. And so, ironically, you save a system, but you make it a bit more unequal in the way people came out of this period.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“The central banks in the US and in Europe, they may have a different mandate. One might be more political than the others, and at times, when you have to effectively finance all the deficits, you have to be mindful that you need to be able to issue and pay down this debt. I think that right now and without getting into too many political details, I mean, Europe is probably is not in a good place relative to where they were in reacting to COVID, for example, or reacting to the euro crisis 10 years ago. I mean, the political situation in Europe has created indirectly some effect maybe on the ECB and as much Christine Lagarde has been doing a terrific job after.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, what we do is not rocket science and it all come down to the value of liquidity and the cost of credit. And then we can start doing what we are supposed to be doing, risk underwriting. And so Europe-US went into a different pattern on the way down and very different on the way up. I mean, here in the US, obviously, you were much more reactive in raising rates, rightly so in my view. Maybe Europe is lagging a bit that time around. They were actually faster at reducing interest rates, even so into negative territory. But there is a little bit of decoupling going on right now. And for us, it's a great way. Portly, you know, Article, where we are very exposed to the yield play, credit, infra, real estate, bespoke credit. And so all that are the starting point of this risk underwriting.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“You had corporates basically borrowing a hundred and being asked to give back 98. And today, you know, when you look backwards and with no back trading, you're like, you know, okay, what were we thinking about back then? Because for what we do, and you know the business, Barry, like risk underwriting is about effectively scaling the risk, you know, the return. And we were in a very awkward environment. And so that's why I was surprised to see so many people surprised. A year ago, May 22, you know, interest rates started rising. And all of a sudden the whole software bugged.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Both of them were obviously driven by interest rates, and they moved the same direction but in different patterns. And when we first got into negative interest rates in Europe a few years ago on the back of the euro crisis, first with the sovereigns, but then with the IG market, with the investment grade market.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“When you're putting ten percent, twenty percent of your balance sheet capital side by side with your LP, you can do a basic Excel spreadsheet and you'll see what is at stake. And that effectively, yes, you're going to make some money on the management fees, on the performance fee, the carried interest, but what you have at stake side by side with your client is a totally different magnitude. And I think this is where the industry should be heading. And many of our peers, competitors, they all have different models. But the one with significant skin in the game, from the GP, from the partners, from the balance sheet, and going public, by the way, Barry was a great way for us to strengthen this equity base, which is partner zone and control and management own to effectively create what has been so far, certainly in Europe, a second to known skin in the game model.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“And in our industry at times, I think that there's been a little bit of irony, not to say hypocrisy in the way that we showcase the skin in the game. I don't think carried interest is a great alignment of interest. The only alignment of interest is the amount of capital that any given manager or firm is putting into its fund. When you read that, okay, well, we put 1% of the fund as commitment from the GP, the fund is a billion, you know, we put 10 million. It's a lot of money. Yes, but you're charging 2% for the next 10 years. So the option cost is not that high.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“establish a name for yourself and obviously you've got the track recall and you can showcase that so that's step one the second thing Barry if I may is you know in our industry what should make the biggest difference is the skin in the game that the managers you know put into their business I like to say that in our industry you come across a lot of people who are willing to make money with someone else's money. Came across less people willing to make some money with their kids' money. Any entrepreneur is taking risks by borrowing some capital and investing into his business. Whatever the business is.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source