YouSaid · the spoken record

Mike Freno

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69
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2025-01-23
most recent
2025-01-23
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1
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  1. “One brand under one operating model and under one culture. Now, not everyone made the transition. I'd love to say that it was really easy to do, but at what we decided to do was really have... committee driven team based approach in some of the portfolio managers of some of the firms were more driven towards the i have sole discretion on everything i do there's not a process it's it's my decision to make these and i have the support of a research team and that that didn't always mesh up but we made the decision to move to move to the one standard of investing and created what is now bearings and have subsequently been able to bring in additional acquisitions again all under the idea of we want to fully integrate these”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “Yeah, it's a challenge at times. And what was interesting is Babson itself had been a series of acquisitions as well. I mentioned DL. Babson was the first. There was a group called IDM, which was institutional debt management that was purchased out of First Union Bank. It was really a CLO and loan manager. That was actually the group that I joined at the time. We also bought a business in the UK that was a parallel. It was a leveraged loan in mezzanine investor called Duke Street Capital Partners. So we had brought companies in together all with the philosophy that we want to fully integrate these. And I'll talk a little bit about the philosophy on that and some of the challenges that come along. But really, when the decision was to bring them together, we felt to get the most scale and the most long-term value to our ultimate owners, which is the policy owners of Mass Mutual, was to combine these businesses under”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “Babson Capital. And so we had four affiliates at the time. There was actually five affiliates because Mass Mutual at the time also owned Oppenheimer funds, which is subsequently been sold to Invesco. But we made a decision to combine the four brands, the four aforementioned brands together under the new bearings. And Babson was actually the largest. It was the fixed income manager, but it was the largest in terms of AUM. But what we recognized was the Bearings brand actually carried more value than the Babson brand, certainly internationally where our presence was very well known. And so we made the decision to combine all four of those businesses together under what was now titled Bearings.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Yes, at the time Mass Mutual was really, you saw the value in asset management, not only for its general account, but also to be a third-party business. And at times was opportunistic in purchasing up smaller asset management at the time. Bearings was one that was purchased from ING, as you mentioned, to really be, it was the multi-asset international equity business. There was also Wood Creek, which you mentioned, which was a real assets business. Think of it in music rights, royalty streams, infrastructure type things that have tractor trailers that have longer-term cash flow profiles. And then there was Babson Capital, of which I was a part of, which was the largest. And Babson was actually the predecessor to that, was DL Babson, the equity manager. Mass Mutual had purchased that. And then ultimately had spun out what was the mass mutual investment management into.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “To make this year They're your ten decisions. Eight of them I'll support 100% and I'll love them. Two of them I may hate, but that's okay because they're your decisions and they're probably better than I would do because you're closer to it. And I have to remind myself of that too because there's sometimes when I get uncomfortable, I want to go back to the areas where I'm comfortable and everyone hates to see me sitting on the trading desk because then they're like, oh, here he goes.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Yeah, I think one thing I'm fortunate and blessed to have is self-awareness. I know what I don't know. And that's been proven to me a number of times through some mistakes, but I have the scars to show it. But knowing what you're good at, and we all have very good gifts and we all have weaknesses, and I think it's okay to accept that and say, I have a gap here. I need to build people around me who fill in that gap. But it's hard because I think inherently most of us believe that we make the best decisions. And so you do have to start moving that. And I try, what I'll tell when new people join the team or when I take over a new in the past when I've taken over a new team is because often what happens is people are making a decision. They're looking to their boss. Well, what kind of lean would you go? I'm not looking for an answer, but just kind of give me a direction of where you go. And maybe that's where I'll go. But I've often said you'll have 10 to 60.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “Yeah, so it's coming up on 20. I've been over 19 years now, so we're coming in on 20. And I was very fortunate to find myself working at Babson at the time in a place that fit my personality and my skill sets well. It was very much a team-based approach. It was very much a collaborative approach. It was built on fundamental analysis, which fit my skill set well. And so I think when you're fortunate enough to find an environment where your skill set can be amplified by those around you and by the business process or the culture that's there, it works. And I was, again, very had an opportunity to take on a lot of responsibilities. I was entrusted with things early on in my tenure there and was able to start new products, to go out and market those products, to see how.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “Process. And as I said earlier, as you move further and further up an organization, you probably should be making less decisions and you're empowering. You make the big decisions, the ones that are critical to the survival and effectiveness of the company. But outside of that, really relying on your team to do a lot of that. So I think working at both and having the experience of both gave me the appreciation for both.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “Yeah, I think working at a small firm, you begin to appreciate how effective quick decision making can be. But understanding working at a large corporation, that you need to have controls. You need to have some element of controls and process that goes along. And so balancing those two out and creating an environment where you're empowering people to make relatively quick decisions and failing fast as well. Make decisions to invest, makes decisions to go grow businesses, to acquire businesses. And if things don't work, let's be intellectual honest about it and move quickly. So I think the balance of those two and marrying those two together. And while we're a large company, we're around 2,000 people, again, in over 20, 20 countries. It's big enough where it requires certain process. You can't have the decision makers all sitting in a room every single day just making them. It does require some ability to decentralize the decision-making process.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “We're in over 20 countries. And when people talk about culture, we have different cultures candidly in different regions because there's different behaviors and things that are done there. But I will say what we do when we describe it is we have a set of philosophies, a set of principles, and a set of values that are consistent. In understanding that and recognizing what works in Charlotte, North Carolina may not work necessarily in Seoul Korea was actually a pretty big learning curve for me.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “Think actually provided me a pretty good roadmap for starting to rely on other people because you're not going to know everything about everything. I was investments that's in my background, but running a company requires a lot of other people to do a lot of other things in making sure that you are comfortable, and we'll say in this way, letting the plumbers fix the sink. So I wasn't an expert in technology. I wasn't an expert in operations. So I had to rely on and make sure I had people there I trusted to make the decisions. And I think that was one of the things I learned early on was I should probably make few decisions as the leader of the company and entrust my people to make a lot of them. But make sure you've got the right people there to do it. And then the transition is it's different. Managing money and managing people is dramatically different. And this is the people business. Our asset is our people. It's an incredibly valuable asset. And then running something that's global creates a whole other set of challenges.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “Yeah, it was a. I stepped in in November of 2020 because a lot of things were going on during that period of time. So there was a change. But I was fortunate, as I said before, I came from an accounting background. I was also at the hedge fund. I was involved in the operations early day of getting things up, understanding how settlements work, things of that nature that is in the, they called the back office today, but is increasingly important and complex, candidly, when you move into different types of asset classes. So I had some familiarity with that. I did have a stepping stone from when I was managing portfolios to before I took over the CEO, or I briefly for about eight months sat in the president's role, which gave me also oversight over investments. I had the investments to sales, technology, and operations. And while a brief period, it gave me an appreciation for things I didn't know well.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “It's become an asset for us to be located there for sure. The talents there, and so you've seen a number of smaller financial services firms start up around there because financial services firms like yourselves move down there because that's where talent is and that's where people want to live. So it's been great. It's been nice to see the growth and there's a real commitment to the city there. So I think we've got a few more years of growth for sure.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “I've been there largely. I started out in South Carolina. I went to school firm and was in Greenville, South Carolina, so really started my work there. But then ultimately, the majority of my time since 1999 has been spent in Charlotte. And to your point, it continues to grow at a rapid pace. It is a financial services hub. It's certainly not New York City, but it's definitely the top two or three in terms of large financial services. We had the benefit of having Bank of America be located there, Wacovia in First Union, the predecessors to now Wells Fargo had a headquarters there. They keep continue to keep a large presence there. But what's interesting about it is when we first started going around and marketing to the world and our institutional clients, we would often get questions, how do you retain talent? How do you attract talent in Charlotte? And the response was, just come see it.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Bit yeah, I think it has, and I do say this to folks and folks in other industries when you talk about the excitement of analyzing a financial statement and going through, but it does tell a story. If you know how income statements and cash flow statements translate into balance sheets, it will tell a story of how companies are doing. And if you have the intellectual curiosity to dig deeper into it, you can really get a full picture of who's got a sustainable business who possibly doesn't. And so you couple the fundamental analysis that with some general understanding of business. And I think it's an exciting combination and one that I really had passion around and enjoyed doing. So again, was very fortunate to find myself in many roles, which allowed me to do that.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “More about this later, but we're up to over 700 now, so there's been a tremendous amount of growth there. But really, in 2005, I made that shift to Babson and really still doing what I was doing focused on. On fundamental fixed income analysis”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “Yeah, so it was again often these things you have to be in the right spot at the right time and Fortune was there for me. And so again, I was gravitating more towards, I did some trading. So I was working on the trading desk, but really gravitated toward our distressed and event-driven strategy, which was largely around. At that point in time, it was the early 2000s. You had a number of bankruptcies going on. We were analyzing all sorts of things. And I really enjoyed the analysis around that and then had the opportunity to speak to the folks at Babson, which was one of the predecessor firms to Bearings. And they were really down there running a leverage loan and a high yield business, again, which fit really nicely with what I was doing. They were moving into more event-driven strategies as well and had the opportunity to go over there and start working with them at the time. Babson had about 20 some odd people in Charlotte. We can talk.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “And the fun side of things. And then as companies grow and you're only five people, you tend to start to wear a lot of hats. And as a result of that, had the opportunity to start trading, had to start the opportunity to start doing some analysis. We had a multi-strategies that we ran. We ran a merger arb strategy, also distress debt, which is really where I probably gravitated to the most just because of the fundamental analysis that's associated with debt investing.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “What originally started out in accounting. So I was an accounting major coming out of Furman and worked with the legacy firm for the date myself a little bit. Cooper's on Lybron. Oh, sure. Briefly before it was merged into PricewaterhouseCoopers. And so I spent a couple years on the audit side and then actually transferred over to the tax side. So my first four working years were spent in public accounting. And so that was really the intention at the time was I was interested in accounting. I loved many people won't appreciate this, but loved the way financial statements work. I like to see how businesses make money. And so I always envision myself doing that. But it did have a good, a fortunate opportunity to go really work at a startup hedge fund. It was M&M Partners at the time. It was relatively small. We were just over 100 million when I went to work there. I went as a controller. So to kind of help out on the accounting side of things.”

    2025-01-23 · Masters in Business · From Managing Portfolios to Running an Organization with Mike Freno · IDENTIFIED FROM THE TRANSCRIPT · source