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

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“I don't know how it comes across, it's not the underdog, but coming with something that is different so that clean slate? Yeah, so that you can make a name for yourself and then use these adjacencies at the business then to scale and make them very mainstream. As I was saying, the secondary private credit that we launched a couple of years ago now here in New York is becoming a bit more mainstream. Every day I would see one of the large bulge bracket banks launching or speaking about the initiative. But like, well, maybe that was a good idea we had.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, when we studied, as I told you, modest, there were plenty of franchise out there when even if you talk to private investors, high net worth, family offices, you can be a bit more nimble in the way they approach their asset allocation, they need to see a reason why they would go with what was back then a TKW, more than a TKO, and find a reason why they would allocate there. Back then in Europe, back in the day, when we start doing private credit, direct lending today is very much mainstream. I can tell you that back then, it was not. At the time, they even called it shadow banking in Europe. It's been quite a while since I last read about shadow banking because it's become so mainstream and structural today that it's really part of the, so we've always tried to effectively be”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“That's right, and we use that a couple of times very selectively since going public infra was one of them, another one in real estate in Europe. And, I mean, they were very selective Bolton acquisition. An acquisition in our businesses is always a big bet, right? We're in the people business, and you need the chemistry. I mean, you need the culture to work out. But looking forward, certainly we're in a better position today to consider acquisition than we were in a few years ago. So as the market and the industry restructure, we'll certainly be very, very opportunistic.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“When one of the first ones to move into secondary private credit, fast forward a couple of years, three years, now we can demonstrate the merits of the strategy, the track record of the strategy. We started expanding into mid-market infrastructure. That was right before the Biden election and all the focus on infrastructure when we were not active in infrastructure in Europe. So we tried to find some play that could differentiate ourselves not only vis- ⁇-vis our European and Asian investors, but also here in the US, to be able to tell a different story to LPs with one key differentiating factor is the skin in the game that we have as a structure and as founders into the organization.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“So that was in twenty seventeen when public on Euronext Paris. And coming to the US, there was no other alternative than coming to the US at some point. And we thought the timing was right, both because we had now, we had then 20 billion AUM, we'd been in Asia for a few years, and it had been extremely promising. And so I decided to come here to promote this brand, to convert into a commercial relationship, raising more capital towards US investors, which to your point is one of the deepest markets in the world. And then also start deploying capital here in the US. Not that there is a shortage of capital by no means, but as we like to say at TK, create, not compete. And so we started initially like secondary private credit, you know, private debt was a mainstream, developed strategy here. I mean, globally and here in the US.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“That's right. And all our historical backers, shareholders, they actually kept on supporting the business. We tapped the ECM market twice and they all reinforced their ownership. So unlike many IPOs which are a way to monetize the business, for us it was about really about rationalizing the platform. We had just come out of 13, 14 years of very entrepreneurial development during a period, as you mentioned, which was pretty bumpy. And so it was a great way to rationalize the platform, come with one brand, one name, getting the name out there.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, size is definitely a reason, but I would add we had just gone public at the time, 2017. And for us, the listing, maybe way before it became more spread in the recent years, was that the main objective of the listing barrier was really to promote the brand, the franchise. We never saw a single share on the occasion of this. You guys only”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Interest rates started a year ago. We're of the view that it's not getting lower anytime soon. And so we go back to the basics of what our job should be, risk underwriting, risk assessment, asset prices are different from asset valuation. I mean, the valuation in the future cash flow discounted at a risk-free rate per risk premium. Well, guess what? The risk-free rate now is 5%, is no longer zero, and the risk premium is closer to 5% than it is from 2%. And so all of a sudden, the whole merits of our job gets back into the center.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“It was certainly the case for us. Again, many challenges, but with the hard work and with people who could see the opportunity and possibly with a European approach, thinking that, yes, you can. Develop a very multi-local footprint organization in Europe be an alternative to global investors, to clients, to the one established mainly Americans, I must admit. That was very exciting. It was very exciting to get into that and to a certain extent we had been looking forward for the day where we could face another of those crises and we all know they're all different but better prepared, better prepared with more resources, with a more powerful platform, with a bigger footprint and COVID aside, leaving, I don't know, Brexit aside, leaving all these little steps over the past 10 years, 12 years, we've been getting better prepared for when the cycle changed. And we may have entered this new chapter, this new cycle.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Strengthen an entrepreneurial company's balance sheet because he's not, you know, she's not trying to sell the business. It's just about making sure you find the right partners to strengthen the balance sheet. And so on and so forth. We started a new period. Adding on top of that this very accommodative monetary policy, where that was the beginning of a new chapter for private markets. And we were lucky to effectively embark on this journey at this time.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“I like to say maybe not less naive about how easy all these things are because they're not easy. Steve Schwarzman wrote his book. It's called What It Takes. And so for us, that was everything's being equal. The beginning of the second phase of the Journey, where it was no longer the teasing pot. You were effectively into the real stuff. Now, on the positive and the silver lining was that this whole situation started, you know, putting a lot of light on, let's say, the alternative market. Private debt, private credit was unheard of in Europe until the banks effectively went into this massive liquidity squeeze and others asset managers had to step in and feel this void, great opportunity for us. Private equity at the time was only about buyout and LBO. Only few had heard about the growth equity part where you need to”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“No, no, that was a bit of all of the above. But more importantly for us in our development, as I said, it was about never taking anything for granted, granted, because Lehman Brothers is a single A rated bank on the Friday night and its defaulted on the Monday morning. And even if I'm sketching a bit, from there on, at the time where 800 million AUM, I guess, we have a team of 20, 25 people, most of them still being with us today, by the way. And it's great when you've been to war together, if you allow me, because then you just have to look at someone in the eyes and you know exactly how they're going to behave because we've been through that together. And so for us, be on the people and be on the institution, it was the beginning of a second phase of the journey.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“And so you're like a young entrepreneur living this neod experience despite thinking that you were close to certainty because you were working with the best institution and counterparty you can think of. And then all of a sudden it's all about how you see and look at the world, never take anything for granted, always be in the world of challenging everything. So it's not good for your stomach pain every morning, but only the paranoid survive. And I think that was a great learning experience.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Was an experience because you know the dot com bubble, I remember being a young associate at Merrill Lynch and all the investment bank, they had to reinvent themselves to make sure they could remember this retained talent that we've been hearing lately again. So they were creating some cool working space and you would no longer wear a tie and all that, which was all form of a substance and as if there was a shift. And then you have this ramp up from effectively 04 when we launched to the GFC, and we're three years, four years into business at TKO. And I remember we feel extremely proud because then we were banking with Bierstern, so we were banking with Lehman Brothers. And that was a step in the entrepreneurial development. And then all of a sudden, over the weekend, those banks are gone.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“You know what? It's actually back to what I was just saying. We were watching all this franchise being launched and obviously at the top of them, other one you can think of who are leading the industry today. But back then, they were managing a few tens of billions of dollars, which was enormous back then, but it's only a fraction of what they are today. And we were seeing all these American franchise launching in Europe, out of London, and we're like, why don't we give it a go? I mean, we learned leverage finance. We learned real estate debt. We knew high yield. We knew opportunistic investment. And we're like, it's never too late. It's never too early. And we decided to go with a huge 4 million AUM that we had gathered from friends and family. So, he can appreciate the challenge back then, but you have to start somewhere.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“It is for sure. And for us at TKO, it's been an important step to open and expand here in North America. Just by background, Barry, when I moved here five years ago this year, in 2018, we had barely no relationships in North America. We had made a few investments relationship from a client standpoint, I mean, from an LP standpoint. And fast forward, you know, today is close to 10% of our AUM that we have raised here. We launched new initiatives. We try to be differentiating. And obviously it's a long-term game and you have to be definitely long-term greedy when you set up a business in the US. But in the business we're in today, in the alternative asset management space, as competitive as it can be, but the structural opportunity now is such that the commitment as a European that you have to make here has to be long-term. I made the commitment personally.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“With the people and great mentors, you know, for me, I now can hopefully understand better the cultural difference as we expand here. And as I'm sure you would appreciate being here in New York is a very different reality than the rest of the Americas, partly when it comes down to visiting new clients in the Midwest, the part of the US. So hopefully there's a bit of convergence here to make it worthwhile.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, it's an interesting question. Looking from the US, Barry, at times, Europe may be an easy concept, but it's a very complex reality. And so doing business in Europe is obviously, you know, it's all about being local because Italy is not Spain. France is not Germany. At times people in London think that they cover the whole European playfield. Again, it's a complex reality. So having met people back then, Americans working for these U.S. banks, now they understand that. And they want successful, and even some of our peers, competitors, France, American franchise, who are competing and tackling the European market, very often the ones successful, very successful, are the ones who've been spending a lot of time on the ground. And then on the contrary, hopefully having worked for US franchise, have been spent.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“In a prior to joining a business school in Paris, I studied political sciences in my native provence, you know, in Aix-en-Provence. And there was no hint at the time that I would be heading into finance. And so when I then got the exposure and getting to learn with great teachers, by the way, what, and again, way back in the late 90s, but then you start reading books. And I'm not talking about the theoretical books, but some experience, the people. I remember these books, you know, reading the Lias Poker from Michael Lewis, you know, reading Predator's Ball, you know, about the milk and a junk ball. And that's where the excitement started. I have to get exposure to that. So, no, there was nothing written, but it was a great step.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“The exposure you get in investment banking. I was a leveraged finance banker by background. And so late 90s, that's the emergence of the high yield market in Europe. You would print deals like never before. You get this exposure. You're a young analyst associate. You get to go on the road show with management teams. I look backwards. That was a hell of a training in terms of the exposure you're getting.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, no, that's right, Barry. You know, that's one thing in Europe where London was, and actually think still remain the one place where you want to get exposure when you join financial services. So I was lucky to get this summer internship at Merrill Lynch back in the late 90s. I met Antoine, effectively my co-founding partner. So that was a while back. But nonetheless, I don't know if it was Lova's first sight, but we got to get along pretty well. And after a few years working for investment banks, he then joined Goldman Sachs. I joined effectively Dutch Bank. We decided to try to have a go on our own. We were 28, 30 respectively. And looking backwards, as much as investment banking, even with banks that are no longer there, was a great training. I think it was a great training. I think we learned a lot.”
2023-06-09 · Masters in Business · Mathieu Chabran on Using Creativity to Compete · IDENTIFIED FROM THE TRANSCRIPT · source