YouSaid · the spoken record

Suleiman Alderbas

lines on the record: 65
first: 2021-05-10
most recent: 2021-05-10
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

“My biggest mistake has to be not talking to people when I am going through a lot of emotions and not really opening up that notion of keeping everything internal is daunting, honestly. Everyone has to be fine with sharing their emotions and sharing their feelings. And one of the things that I've really adapted to and I'm really fine with.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“So it's about this Trans-Siberian trip that the author takes. It's this amazing spiritual journey that he takes throughout that journey, experiencing inner emotions, be it fear, anxiety, et cetera, confronting that and being okay with it”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Have a lot, it's grammatical mistakes, but other than that, it's generalization, right? So saying that active management is done or hedge funds charge high fees, it's a huge industry. It's all about selection”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“My favorites would be traveling. I love traveling a lot, meeting new people, experiencing new cultures. That's probably my favorite hobby pre-COVID. During COVID, it's a lot of walking, running, and spirituality.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“And on Asia specifically, and that market neutral manager, we didn't kill that investment because of performance. We were fine stomaching underperformance. But what we were afraid of was a business risk. And that manager was losing assets. But we went through similar experiences in the past where other managers were losing assets and we stuck to them. And when we stuck with them, we so changed because we need to see change, not only hear about it. And when we stuck with them, we got better terms. And a year later, when they delivered on the restructuring plan, we injected capital to them. And it's one of the best amazing relationships we have so far.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“the reputation you built as an investor right so i remember when covid happened we started getting calls for allocations and i specifically remember one manager calling me and telling me soleiman i have one billion of capacity and you're one out of five and on that specific phone call i told him we're gonna take 200 of that but i can't commit on april 1st i can come in in may 1st because we had a huge line of people wanting to go into the ic when may came about i didn't have my 200 million even though i got the approval for it i only had 60 so we will be honest and frank and it all depends on being honest”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“So remember that Asia market neutral. It didn't work because Japan was kind of boring for a really long time. And then it really ripped off. And now we're going back to the drawing table and revising Asia. And this is coming at an institutional level where we're working with the research department and thinking about Asia and how can we approach Asia. And for me, I want Asia to be 15 to 20% of my book over the next five years, coming out of a 3% position today.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Now when you go through that type of significant restructuring, inevitably either internally or in the investment decisions you make, you won't get everything right the first time. What were some of those stumbling blocks on the path from where you started to where you got today?”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“It to your managers, and the managers that communicated, the managers that built that knowledge gap are the ones that said in the book. Surprisingly, we had more ICs last year and during COVID than ever before. And this really gave us confidence because every institutional investor proclaims to be a long-term investor. But when everything stops working, things change. And I'm really proud to be part of this institution.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“It all depends on the culture. Whatever you're trying to do, it's the culture that you're trying to create things within. We couldn't have flourished and delivered through the challenges of 2020 without the resilience, commitment, and courage, and most importantly, harmony. There has to be harmony, harmony within the team and harmony across the whole ladder up to the IC. It's about talent being a top priority, the notion of hiring, investing and most importantly retaining that talent. I think we went through an amazing experience in COVID. So when COVID hits for us here at Fifth, it was a seamless transition because leading up to COVID, we already had the cloud and everyone was active on teams. It came from top management that everyone, businesses as usual, markets will come back. Just make sure you're kind of...”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“hedge fund specifically but we felt that we could up the volatility there and what we did was that we said 70 of that book will be in hedge funds and 30 is going to be in co-investments and those co-investments are going to be funded out of the hedge fund so instead of keeping money in our books here and calling money whenever it is needed it's going to be directly invested through the hedge fund”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Are about being honest with ourselves and taking smarter risk. So for instance, we did good in COVID, but we could have done better. And what hurt us the most in COVID was the Sochi credit exposure. And one of the lessons and takeaways there was that we still are going to do so credits, but we're going to do it in a different route. All esoteric credit is going to strictly be done through closed-ended fund formats. And that is because while we're long-term investors, we don't want the market to take advantage of us or other investors. We're only going to do investment grades such as credits in open-ended fund formats. Another innovation is that up until last year, we never invested in a TMT-focused manager. What we did was we partnered with one of the best TMT managers and we like the portfolio.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“That's twofold. So we have the growth and mature strategies and we have the co-investment effort that we only started in May of last year. It's been a rewarding experience ever since. What we want to do is similar to what we did in constellation, we want to bring other like-minded institutional investors in only when the time is right because we're willing to take that unfunded pulled risk because we're doing it with buffer. And when we have the right constructs, we want to be able to attract other institutional international firms to the table and probably dilute ourselves out and diversify that and expand up within a set for that program back to the innovation point you raised earlier. So the last three years for us were about taking risk and the next three years for us.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“So the first thing that comes to mind is the demographics of Kuwait. Compared to other pension funds, we're kind of at an advantage because we have a young population. So out of the Kuwaiti nationals, around 60% are aged less than 30 and around 40% are aged less than 20. So with that, you get no sudden liquidity needs and you get the ability to invest aggressively in private markets. You get the ability to take long-term views and invest with them.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“What we love about them is their cash flow businesses. And you get this continuous coupon, right? Which initially started in 2016 as adding only 50 basis points to In 2020, my book delivered a 12% performance of that 12%, 5% came from the strategic book. So now, actually, six days ago, the new strategic asset allocation plan was implemented. And with that, I'm going to be spinning over my strategic book into a newly created bucket. And it's going to be called the opportunistic book. It's a completely different business and lens because it has a different unique purpose in that we have high conviction in those managers and we want to support them in whatever way we can. If it comes to creating sidecars with them, we'll do it.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“We want that feedback. Why didn't you get the money? And why did you get the money? And why are you still an investor? That's what we're trying to continually do.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“To whatever relationships we have. So out of those 21 relationships that we have, PIF currently has LP money with 10 of them. And one thing that we're currently working on is that we're creating this feedback form where it's kind of a survey that is going to go out internally at PIFs initially every six months. So each head of department and his team will get a template where they mark or take across which of those relationships they have relationships with and they evaluate their experience not only evaluate their experience as an investor but as an outsider and what value add can we create what guidance can we give what interest do we have in whatever space so we want to take away assumptions we want to take away stuff that is not said and done a relationship doesn't have to be about going to a meeting either getting money or not”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“On our own directly, we haven't done anything. It's almost entirely through Wafra. If we take a step back, PIF has three investment arms. And it's WAFRA New York, Wafra real estate in Kuwait, which is involved in MENA and GCC real estate. And Wafar International, which is focused on local and MENA equities. So with regards to the strategic relationships that we have, we have 14 GPs where we own 5 to 30% of that specific business and we have six businesses where we have a revenue share out of that. And what's most interesting in that, in addition to trying to create synergy was trying to create business and reintroducing those firms and their products initially to different departments at PIFs and then”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“And then we decided that we have to open up the strategy that outside world. So through consideration, we did it through a JV, initially with Alaska and RHELPEN. And with other mature stakes, we invited our fans over at the KIA Kuwait Fund and now working with other institutional international investors.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“When it's at the private equity book, it was an investment. It was labeled by an IRR and MOIC. When it came to us, it was way much more than that. And that's where the strategic and asset owner mentality kicked in. So some of the stuff we're doing there is that today we sat at 211 strategic relationships and a huge focus for the institution is synergy. How can we synergize those relationships? And we're currently working, for instance, with the strategy department here at PIFs in introducing those strategic relationships to that strategy department and trying to create some type of strategic relationship and cooperation between the state of Kuwait and those strategic relationships. Initially that strategy was on a deal by deal basis.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Book, we ask the private equity team to give us the GP acquisition strategy. And that strategy at that time made 6% of our book, of Nav. We grew that book to 14% of Nav, 20% on a commitment basis. And there is where our strategic relationships and strategic investments sit. And that's predominantly led by WAFRA and that we pursuing two things specifically. It's growth strategies with small to emerging managers through the constellation strategy and then mature managers, be it Stone Point and the likes.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Basis points to 63. What was amazing was that the alpha turned around from a negative 1.3% to a positive 3%. And looking at the MSCI specifically, you can easily say that it could easily have been done because we had a bull market. We maintain the same beta to the MSCI. So it's still the 0.24, but with a positive 3% alpha. How was that done? I think it was done through hard work, patience, and the resilience and the passion of an amazing team that I'm part of. A big driver of that performance is the strategic book. And that strategic book specifically is something that's really unique and really adds color to the name AID. When we moved over with the 40 line items that we took from the open end.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'll take you through the return and then that would suddenly translate into the construction itself. When we took over the book in October 16, the annualized return for the AID was 1% over 3% volatility. It was bad. The sharp was negative 0.2. We had the beta of 77 basis points to the HFI fund weighted composite. We had a negative 1.3% alpha. We had the beta to the MSCI of 24 basis points and a negative alpha. So there was something wrong. And as it is, we are still underperforming the benchmark almost four years later. So by the end of December, the book collectively had a 7% return on a 6% volatility. So that's a sharp of one. And the beta to the HFI fund weighted composite came down from 77%.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, said there were only So, when you put this all together now a couple years later, you had these fund of funds for information sharing and network. You're meeting with lots of managers. What does that book look like today in terms of the mix of types of strategies and implementation vehicles that you have in it?”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Europe was really interesting because it had an amazing number of fundamental, amazing long shot managers and there weren't really much market neutral managers there and it didn't make much sense for a market manager there because the way that it's all a single currency and then it's kind of northwestern Europe versus southern Europe and the cyclical drive around it through meeting those managers we decided that those three managers are the only managers that are going to be in our book”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Here is that you have to be flexible. This is one of the most important teachings for me growing up in that I used to think that when I decide I can't go back, what I realized at PIFS is that it's okay to change your opinion and it's okay if even if you have conviction to shelf an idea for a bit and go revisit it, that really worked for us.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“It comes from experience and specifically the book. So we had probably at that time 20% of our book in Asia and we deemed almost all of it. To me, Asia was something that was fascinating, but I've never visited. And we said we won't do anything in investment unless we get really comfortable with Asia. And then only when we visited Asia and every single country, be it Singapore, Tokyo, China, and Hong Kong, realized that, all right, we can't label it as Asia because every country has its different culture and way of doing things. So we have to change our approach and realize that there's a beta market, it's a volatile market, and it would only make sense on a net basis to do it through a market neutral approach. That's my change in the future, right? Because one of the important lessons.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“But for instance, one single position in my market neutral pocket is the equivalent of all of the line items I have in the activist bucket. And for the directional bucket, we decided that at that time we had huge beta to equity markets and we weren't making any money. And we said that we're going to take a low directionality approach of 0 to 40. But again, it has to make sense. So for the equity edge bucket, we said let's look at the three regions of the world. In the US, it's all about execution speed and technology. And we're going to go with the setups. We're only going to go occasionally with the fundamentals that have an edge or something differentiated. Asia, we said we're going to go only with the market neutrals. With Europe, that's the only place that we thought fundamental managers would work.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“As an academic and as a practitioner. And then I reached out also to Gideon Berger from Blackstone and I told him, listen, I have this mess. I needed help. What do I do? And I started utilizing those relationships to get different perspectives and the CAP intro business to get the allocations relationships and the access and capacity, honestly. So with that, we started building the book. And what we wanted to build was that for the absolute return to dampen the volatility. We wanted the volatility there to be around 3% with a return of 5 to 6%. With the equity hedge, we knew that the market neutral multistrot would give us that consistent strong alpha with a bit of volatility. We created that sleeve and then we said activists make sense. Let's allocate to activists.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“What we want to make sure we have is we want to have training sponsorship programs for our analyst. And at that time, we got out of it with 40 programs. And then we rolled over that model across all departments for Quate Fund. So this is the same thing we did at PIFS. We went to the fund of funds, told them what we want to build and create, and we created information knowledge transfer and we made sure we get access. Again, it all goes back again to honesty and reaching out to people that have influence, people that are leaders in the industry. I remember my first days at Fifth, I used to talk regularly to Andre Peralt while he wasn't an investment manager for us at Wait Fund. He's a person that I really look up to. And I told him, listen, Andrea, I'm in MS. I need to send me whatever white paper we have on.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Right, so there's no right number for a portfolio, but we realize that if anything looking at the previous fund of funds that we invested in and that we don't want to be overdivestified, because then it's going to be costly and we're going to be blaming the high fees and everything around it. So we said the max we're going to have in any one bucket or portfolio is 30, right? And we started from there. The first building blocks of the absolute book were the fund of funds because we wanted access to the markets and we wanted access to research. And most importantly, we wanted access to knowledge and the sharing of knowledge. This is something we picked up from Kuwait Fund. So when I joined in Kuwait Fund 2010, everyone was coming out of the great financial crisis and everyone was negotiating fees with hedge funds. And we said we won't negotiate fees. Everyone else will do that job. We're going to make sure we have MFNs.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Buckets and to diversify his bucket. And that got some elements from the altit value and we no longer had a global macro bucket. And there the anchor for that book is the multi-slots. And specifically the fund of funds. And then with regards to the equity hedge, we had three buckets. The activist, the market neutral and the directional. And the anchor there was the market neutral.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“A lot of things, it all starts with what purpose does that specific manager bring to the buck? So the first thing we did was we created a portfolio for the absolute time, for the equity hedge. And we said, a lesson out of Kuwait fund was let's forget about the benchmark for the absolute return, we have to deliver absolute return year on, year out. So with that came the rejection of the bucketing of the HFR index. And what we got from the CIO at that time was complete autonomy and trust. And we started building it. So if I go back specifically to the absolute return book, it had four main components. The first was the strategic book. The second was the multi-slots. The third was the relative value. And the fourth was event driven. It's an ongoing process that we changed the global map.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“In terms of reintroducing PEPs to the world. And we did major global trips. We were present in every investment conference there is. We re-established relationships with prime brokers and capital introduction firms. And that was the start of it. One message we wanted to send clearly was that we are not looking for returns. We're looking for people and process. We are a long-term investor. We'll show it over time and we're patient capital. We're going to persevere. So if we don't get the allocation today, it's fine. We won't go to a second tier manager because we didn't get the top tier.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“So now within your book, you've redeemed 60% of the managers. So it was whatever 10, 12% of $100 billion. You have billions of dollars to put to work. How did you do that over the last couple years? How did you think about it and what'd you do?”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, there was because nothing wrong with those managers, but they were subscale managers. And with subscale managers, you get a lot of position sizes. And then you get a lack of ability to monitor. And with a team of only 30 at that time, that was impossible.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a mixed bag, honestly. It was compliance issues. It was portfolio fits. It was performance. We've been investors for 10 years. And if you look at the returns, they're amazing. But we lost all of those returns because of exchange rates. So in reality, there was no value add. You're an investor of this scale. You can't really take that niche exposure in on a direct basis.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“So in the process of weeding out this portfolio, you had mentioned of all these line items you only had recognized one. Did you find real managers that just weren't meeting compliance or were there all kinds of things that you never would have touched if you had the original decision?”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“We redeemed 60% of the book. Luckily for us, it was an amazing bull market. So when we filed our redemptions or NAVs were slight at the end of 2017 to mid-2018, so the good, the bad, and the ugly, we're all performing exceptionally well. But our biggest issue was dependency issues, compliance issues, legal lawsuits, right? And that's what we tried to recreate here at W”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“At that time to provide, but we went with it. And the plan was to grow the alternatives book from 12 to 16%. So once we got all the information in, the qualitative, the quantitative, we said, okay, it's time to do a global trip. And my team and I visited every single line item of those 80, came back in May of 17 and started sending the redemption letters.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Emails came and the phone call started to come. It was a weird experience. So we realized that there's a big issue there. And we are also to be blamed for that, right? Because we were passive and the managers were passive. And any relationship is at the end of the day is a spectrum, right? And we were at both ends. And we told everyone that anyone who's willing to meet us halfway will work with. Anyone that is not willing to make the changes necessary will be out of the book. So the ATLI items made around 12% of PIFs at that time. And a year ago, PIFs went through a strategic asset allocation model and plan that was created by Cambridge Associates. And you know with consultants always depends on the amount of information you provide them. And there wasn't really that much information.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was bad times because when you don't have information, you're at a disadvantage and you're weak. And the problem was this is everyone's money. We only have one pension system in Kuwait. I and colleagues here spend all night as at PIFs because honestly I couldn't go home to friends and family and talk about work because at that time everything was almost miserable. So we created the DQs, said okay, we have to send those DDQs and those EDQs are going to be shockers to a lot of people and we have to be smart about it. So we decided to send them three weeks ahead of Christmas and said that everything expected to be received a week ahead of Christmas so that the latest person would send us everything before Christmas and then we'd have Christmas all for ourselves with no noise, none of that.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“And then the team internally started reconciling numbers and verifying and auditing, making sure the numbers are good. Once that was done, we sent out the DDQs.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I had no information about those 80 line items. And we had to act real fast. So one of the great things was that I carried over a lot of the stuff that we developed and built at Kuwait fund. And one of those was the DDQ, the diligence questionnaire. So we reviewed that diligence questionnaire, built in the missing links around how was the introduction made? Is there any fast DO placement agent, any dependency issues? What are your employer tension plans, et cetera? And we created this deck of 25 pages, went across the list and said, okay, there's information, but it's certainly missing and non-indicative. Let's rebuild that information. Let's rebuild the qualitative and quantitative information. So we create an Excel sheet for every single line item in the 80. We sent every one of those to every administrator to fill in the details for the last at least 10 years.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was a phenomenal and continues to be an amazing experience, honestly. So the first thing that happened was when I took over the book, I was given a book of 80 line items. The biggest physician was a 13% position and the smallest was 50 basis points. And the operation was a back office operation. We had filing rooms with not so great details. And my first day at the office was really crazy because they told me that IT was coming over. And the IT guy came in with two hard drives. And I was like, what's going on? And he was like, one hot drive is for the internet and your email. And the other hard drive is for the locally saved data. So I said, great. Then you have everything super secure on that file. I went there and there was nothing.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“I can certainly speak about the alternate investment department because I was at least closest to that and at the end of the day this effort that has happened the alternate investment department has happened in every and single other department at PIFs.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“For the investment sector, and that came the creation of a CIA role, which Michelle was at the helm of. Departments and the creation of new departments. So we went from the three investment departments to six front office departments with two support departments. So from the direct investment department, we got the open-ended became the alternative investment department. And then the closed ended transformed into the private equity and venture capital department. The portfolios department was broken down into the equities and fixed income department. The real estate was broken down into the infra and real estate and then they created the research department and the support services department. And from there we had to do one thing. We have to make sure we drive fast while looking at the rearview mirror and making sure there are no zombies coming out. So while we had 40% cash, we had to redeem a lot of money.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“The first thing was we had to build a team. We had to create a story. And Michelle is an amazing visionary guy. He came in and he said, we're going to focus on three things. And it's the three P's, the people, process, and the portfolio. The first thing to make this survive and thrive was that we had one vision. And this vision has to be clear to everyone and that we want to be the best institutional investor in the region in the next five years. Let's bring in the best talents. And when we try to attract the best talents, we're looking for one single thing, and it's passion because everything can be managed and created with the tools that we have here. But passion is something that can't be replicated or created. Michelle joined in February of 2017. And that was the official starting point of the new organization structure of PIFs.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“And they were sitting at 40% cash and they were pursuing legal action against the previous managing director at that time who had a couple of misconduct and embezzlement charges against him. So they needed a team that was willing to restructure and deploy aggressively.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. And went back to create fund, made sure there's clear transition there, joint PEFS in October of 2016. And there was a serious plan that this institution is going to go through a revolutionary restructuring plan. And the works were already underway in terms of creating a governance framework, bringing in global consultants for forensic and accounting review, etc. And when I joined at that time, PIFs had a very simple model. It was a centralized institution and the investment sector had only three investment departments. One was direct investments and they managed two books, an open-ended book and a closed-ended book. So it's by structure. The second was real estate and they managed real estate in a bit of infrastructure. And the third was portfolios. And again, with the name, it's portfolios. And it's predominantly.”
2021-05-10 · Capital Allocators · Innovation in Private Markets 3: Sulaiman Alderbas – A Massive Restart at PIFSS (Capital Allocators, EP.194) · IDENTIFIED FROM THE TRANSCRIPT · source