YouSaid · the spoken record

Nishi D. K. K. R.

lines on the record: 34
first: 2019-04-23
most recent: 2019-04-23
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

“Writing desk, there were very few women around on the floor at that point in time, and that was in 2001. And you look around today and you look at the strides we've made trading is a great example where we now have 50-50 intake of far somewhere analyst program into trading seats. That's a huge change. And just in the diversity of the population that you see around you, things have changed significantly.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“The way you approach your job and your work, hopefully, the core building blocks don't change, you're a work ethic, your attitude to how you want to interact with people, etc. But one thing that's very noticeably different to certainly when I started was this sort of notion of things like FaceTime and efficiency around working has just changed significantly. The advancement of technology has meant that people can work way more flexibly from remote locations, from anywhere in the world to adapt to whatever their circumstances might be within reason. I've certainly been a beneficiary of that and I've had three children over the course of my 18 years here and that has allowed me to stay connected at times when I've been out of the workplace. It's allowed me to manage that very well, very efficiently. And so we've all benefited from that in various different respects, but that certainly has been a big change. And then culturally, the places changed a lot. I started as the distrust.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Opportunity, why don't you look to that? And then that just fit very well with my personality, how I like to work. It was deeply analytical. It was always changing, and it was a great platform that had great people. Mishi and I worked together from the moment I moved into securities, I've worked with Nishi since February 2003. We've kind of grown up together. We've seen this business go through its growth phase, through the crisis, through its re-emergence. But first and foremost, I come back to the firm provides great opportunities to talent and to people who are willing to make those efforts.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Well, first, I'm very glad somebody remembers I was in banking at one time, given our new leadership. But kidding aside, that was, like you say, a long time ago. I was very fortunate that I joined the firm. The firm finds opportunities for people who work hard, who have some talent, and who I think are willing to contribute and make efforts, and who are ambitious. That was a difficult time. Two weeks after I landed here in London off the associate program, the tragic events of 9-11 happened. I remember it very, very well. And so it was as much about the market opportunity that existed at that time, which was perhaps at least in the activity I was in slower on the advisory side, but quite busy on the bank loan trading, the distress side. And I was working hard and diligently despite the conditions. And they said, look, this is...”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“They're really trying to understand what it is that we're looking for because, especially in these sort of early stage businesses, there isn't a huge financial track record or history that you can anchor off as you would in a much more established business. And so I think they're really trying to understand what is it that we see in certain management teams or individuals that gives us comfort that they can execute on the plan. And, you know, a lot of that is down to personalities, their own resilience, their tenacity, their drive, passion, willingness to listen, Greg talked about it a little bit. This is not just about access to capital, but also the willingness of these companies to take on guidance and strategic thought leadership around how they can institutionalize themselves. So there's a lot of time spent on helping, and certainly as part of this initiative, training around what kind of things they should be looking for, how they should present themselves, and how they should engage with potential investors.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“The biggest challenge for women founders is actually accessing capital. When you look at a lot of research done, less than 2% of VC funding goes to women founded companies. That has an effect for the whole of the life cycle of their companies. They can't get capital to start with. They never really get going. They never get off the ground. They never even get to enter the late stage phase of growth. So when you look at the numbers there, it's even worse. A huge part of the drive-around launch was really to try and be part of a piece of rectifying some of that and at least bring awareness to the issue. That's definitely the number one driver of launch, but also the number one problem that we're trying to fix.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“an entrepreneurs and owners. And I think to do that in the middle market, this local presence and relationship is very key. And so investing time in that and investing in the build of that is something I think we're extremely focused on.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“We first really established ourselves in the core geographies of Europe to build a market presence in the key areas. And I think what we've learned and what we're evolving to is this is a very big market which we're penetrating really at the surface and regionalization is probably something that's increasingly important. And in Europe, that's a challenge because, again, this is a scale business and you've got multiple different countries, different cultural processes, different corporate governance, different languages. So navigating through that and we're hiring people in some cases to be based more locally. We have people in the ground in Paris. We've hired somebody to focus on Germany very recently. But really penetrating more regionally and getting away from only sponsor-led business, which the European alternative market is very focused on sponsor activity rather than directly dealing with middle market companies.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“We certainly help our portfolio companies, you know, if they want to speak to any corporation of any scale almost anywhere in the world, we can help facilitate that call, at least the first call. And that's powerful. They have a lot of challenges. They've got challenges of smaller companies coming at them from different directions. And then they have the challenges of the large companies. It's not like they're standing still. But we find them to be very exciting partners to work with. They engage with us. There's usually something happening. There might be bumps on the road, but we work with them. I mean, remember we're a lender here most of the time, but we'll work through those issues in a constructive way. We like companies that need more capital from us. Let's grow together and we can lend more”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Everybody has their challenges. They have the challenges, in many cases the challenges of growth, the pace of growth. The fact that they, in many cases, will become regulated or at least more noticed. The process of institutionalization is something that they are often grappling with. We can help them with that. We have 150 years of bringing companies to markets, telling that story, preparing them. Institutionally, we have that experience, and we have a good track record of helping them put their proper procedures in place, ensure that they have good reporting, ensure that they have the best standards around whatever it may be, FCPA, compliance, etc. Then there's the biggest challenge, and all companies face is attracting talent. We help them get noticed. When you have Goldman Sachs as your partner, that says something, and I think it definitely is one of the things that they want from us. It's more than just capital. It's to sort of raise their profile.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Europe has struggled for a long time now with low growth. These are companies that aren't quite startups. A lot of the ones you're talking about, but there aren't big companies, established companies yet. What are the challenges that middle market companies face as they try to scale in a low-growth economy?”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“But I think it's also very much to do with the history and culture of the region as well. Greg mentioned the military service, that mandatory military service for both men and women has definitely allowed extremely bright individuals to experience and take extensive knowledge of technology. They work closely in teams and they take those things and apply those partnerships and translate them to startups. The population makeup is also very interesting in that two-thirds of the population are immigrants. They've already taken the risk of uprooting themselves, moving. And so that natural risk-taking instinct, I think, in drive, is there. And when you look at entrepreneurs, some of the things that they need to exhibit, I think, to be successful really resonate in this culture. The size of the country is also really interesting because it means that these entrepreneurs have to think very globally from the outset.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Israel's undoubtedly a real hub for innovation and entrepreneurship. I think Tel Aviv has the highest number of startups per capita and for a number of reasons. The government has clearly created the right incentive structure and environment for a lot of this innovation.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“We have many in our portfolio. Nishi talked about the financial space, and there we can provide equity capital, we can provide more structured capital, we can provide loans to help them, like the fuel to help them scale these companies may be lending to SMEs, maybe lending to, I mean, you could talk about maybe neighbor, which is another good example where here in the UK where they extend credit to individuals, but we're providing support to the company to help them make those loans.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“America's market is where they're a little less penetrated. So we, and it was KKR, it's public, we can talk about it specifically, combined to provide a capital solution, but I think it's more than just that. It's a partnership to help them achieve these significant ambitions that they have.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“The sensors and the cars, and this was bought by Intel ultimately, but we were pre IPO investors the firm took it public, and then it was ultimately acquired Israel is important, but our single biggest growth equity investment in Lisbon, a low code software development business that is one of, we think, the biggest and most innovative companies in this space globally, we in a client KKR made a significant investment for around 30% of the company. This is a business that's growing in excess of sixty-five percent top line revenue per annum. They basically do low code software development, which is basically module-based coding. And the core of what they're doing is helping companies digitize. We, again, are very familiar with that. We're going through that as an institution, but also every company in our portfolio is facing that challenge to some extent. And this is just a more efficient way for customers. They have over 1,000 enterprise customers globally. They wanted us because we can help them continue to scale, ultimately access the capital markets, and importantly, the United States.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Pretty broad based. This private capital activity has presence across Europe. We have people on the ground in France. We have dedicated coverage into Italy, Germany, and obviously the UK was important. This technology opportunity is not really localized. There are pockets and we're finding opportunities even places that we wouldn't expect. Israel is a very important opportunity and that is part of our remit. It's well known that there's great innovation. It flows from the knowledge-based economy that is very well established in Israel. Perhaps there's the military complex. We were investors in Mobilei relatively early, which is one of the key companies in autonomous driving.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Extension of credit to SMEs, mortgage back lending, allowing consumers to access credit more efficiently and quickly. We spend a huge amount of time and we do lend and invest in a number of those companies and it's a fairly significant part of what we do.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“It's very broad, and across the whole base, there's very, I'd say, old economy businesses that are still trying to access capital, either to restructure or to find ways to become more innovative and efficient. But there's no doubt that we see an awful lot of capitalizing in the tech space. Tech growth is a global theme. It's definitely a place where we spend a lot of time as a business. The digital economy is outpacing growth of any other economy. And it's certainly one of the best performing sectors we've seen, not just from a financial perspective, but also contribution to the economy and productivity. So we spend an awful lot of time there. And the innovation in tech spans so many things. Everything from the way we purchase items on a daily basis, from the way we travel to even through to the business space in terms of enterprise software efficiency and business organization, and then really in finance as well. If you look at the amount of innovation and financial tech, there's a huge amount of capital that's being raised there to provide...”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“As you said, it's always been core for us to lend and provide capital to companies. And the mid-market is an extension of that, and it's something we've clearly been very focused on over the last few years. But it's a natural extension for the broader firm as we think about the other services that these customers and clients can access. We already provide derivatives, business, swap business, IPO, business M&A activity with large cap clients. This is something we can extend to the middle market. So this fits and dovetails very nicely with, I think, what the firm wants to do more strategically and hence puts it very high up there in terms of strategic priorities.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Mentioned we're now a bank. We've been a bank for 10 years now. This is the kind of lending we did even before we were officially a bank. What kind of a priority is this as we look at the strategy of the firm? What kind of priority is this kind of lending?”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“get better terms. So the US market is bigger, it's more liquid, it's more established, Europe is not a single market in the sense that you don't really have businesses that are operating yet across all of the countries of Europe, and so they tend to be quite local, there are languages, there are regulations, and there are local players. You have different clients in different markets. And so there's a lot to manage. Europe is a complex place, and that suits us well. We like complexity.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“the US market, I'm Canadian, but I sought my entire career in Europe, so I've never had access to what I'm about to describe. It is just so much bigger, so much more liquid. Leverage finance product in general, it's order of magnitude five times as big as Europe, and that's 30 years into the development of these leverage markets. In the direct lending space, it's maybe as much as 10 times as big. It's just a much more established, much more liquid. You have greater scale. And this is a business of scale. I mean, it's a business of volume, but when you're earning five, six, seven, eight percent on a given loan, it's as much work to do a 25 million euro loan as it is to do a 250 million euro loan. And in some ways, you know, given that it's a smaller, perhaps less resilient, maybe with a shorter track record company borrower, maybe it's even, should be a little more work. Now, you do get paid for that.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“There's no doubt that credit selection is an important piece of this, but terms, as Greg says, have been significantly weakening. And I think that's something to keep an eye on because in a world of sort of continued economic and geopolitical uncertainty, banks will be some of the first to put the brakes on, and that could create an opportunity, actually, for alternatives. Very heavily featured in these deals when we first started this business, and now 80% of deals are covenant light.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“How well those contracts have been negotiated, and then how the new players in this are able to manage a less benign environment as a bank we have scale, we have colleagues in the federation is an enormous resource to help us manage the risk and loans are bespoke. We have large teams. Those are going to be called upon when the cycle turns.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“I'm not sure it's a bubble, I think those very strong secular trends we talked about probably mean that there is natural growth and it's normal that this will scale. But certainly there will be excesses, and those may manifest themselves in price. Price is what somebody will pay for something, and that changes through time, spreads will widen in periods of greater uncertainty. And by the way, this growth has been in a period of very, very benign market conditions, economic conditions, the low volatility that people speak to about this asset class. It's to be tested. It did perform well relative to other asset classes through the global financial crisis, but it has been a benign period in particular in Europe where this asset class has really taken off. And that gets to the important point about current conditions, where it really manifests, I mean, these are all negotiated bespoke transactions. Every transaction, we write a credit agreement, and we negotiate a credit agreement. And while there are standard forms, the devil is always in the detail. And I think what will be interesting to see is it plays out is just...”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“The European market was in the past very bank dependent, and if you were a company, you really had to go to a bank to get a traditional loan and the banks have pulled back. But now this asset class has grown. It's become more competitive. You mentioned the amount of money that's been raised. What are the risks associated with that marketplace becoming so competitive with leverage going up, pricing coming down? Does this have the characteristics of a bubble yet?”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Which was Peak Capital Risier for this asset class. And when you consider 10 years ago, it was a relatively unknown asset class. So really the low rate environment has fueled a huge amount of capital growth here.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“A lot of this capital that, as Greg alluded to, comes in the form of loans. And these loans are seen as having a very low correlation and certainly low volatility to competing asset classes like equities or the high yield markets. And they're also typically secured. So these characteristics, the security and this low volatility of the product makes it very attractive from a risk return perspective, particularly when you look at where some of these competing asset classes are trading and you can earn sort of 6% to 8% yields in this asset class versus looking at the high yield market where you have crossover spreads at sort of 275 basis points. So that spread above rates benchmark rates in whichever country you're in is still quite high relative to some of these other asset classes. And I think you've seen that with just the growth of capital that's come into this space as a result of that. So I think in Europe alone you had 29 billion raised in 2017.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Obviously, in the wake of the financial crisis, central banks around the world, but particularly in the US and Europe, slash rates. And so we've had now a decade of very, very, very low and sometimes negative interest rates. How has that long period of low interest rates played into the growth of this market as investors look for yield?”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“To all of this is innovation. The whole thing about the alternative lending space is that you'll lend against businesses. This again, it's back to that very beginning, what I said about the high yield product. You'll lend against businesses or business plans that don't have a 30-year history of borrowing and paying back and then relovering. These are businesses that are growing. And so if you take, for example, a restaurant chain, they have maybe 30 burger outlets or something like that in the southeast of the UK, and they want to grow that to 50, but they need capital to grow that. I guess they could do that over the next 10 years by internally generated funds, or they'd have to raise some expensive equity. That's the traditional way in Europe, because their banks are not going to give them that money on the business plan. We can underwrite the existing 30, but also we understand how those businesses can grow. We put controls in place, and we can provide”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“I think many of these companies, certainly in Europe, they started as financing companies that couldn't access the capital market, either because of their size, they didn't have a history of nicely cleaned up financials that they could present to a bunch of public investors. And the opening of this has seen the influx of a number of asset managers step in to provide this type of capital. And now we've gone beyond providing the capital just to companies that can't access capital markets. This form of lending in Europe has evolved and has become an asset class in its own right to the point where companies have now an option where they go. They could take a high yield bond or they could come and take a privately negotiated loan solution. So it's really evolved fairly quickly.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“They're disproportionately important. I mean, it's something like 70% of all credit provision in Europe is still through banks. And so it's a much bigger part of the market, and that part of the market was troubled. And so that provides a gap. You've got the secular and the cyclical intersecting. And we really stepped into that. And others have noticed too. I mean, there's been huge amounts of capital raised to go after this opportunity and serve a market that is heavily mid-market oriented. And so in any event, probably doesn't access the traditional high-yield product it needs a loan product.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT
“Sure, in order to do that, we need to step back even further back into the beginning of innovation in lending. And that emanated from the US, I mean, back to the Drexel days, where high yield was really invented. And the idea was that lenders would fund companies that perhaps weren't established credits in the traditional sense, but with a formula that allowed them to get paid for the risk they were taking. So the high yield market emerged, innovation took off as it does in America, and that came to Europe. By the beginning of our careers, we were part of that in the kind of the early 2000s here in Europe. And then you had the global financial crisis. So you had this kind of secular trend anyways, and then you had this almost catalyst for a much greater need for alternative lenders in Europe because of the banks really were not lending. The banks in Europe, I mean, banks were hit in America, but the recovery was much, much faster. In Europe, we're still recovering.”
2019-04-23 · Goldman Sachs Exchanges · What's the Role of Private Capital Markets in Europe? · IDENTIFIED FROM THE TRANSCRIPT