„The Family Office view: Entrepreneurs understand entrepreneurs and like to invest in entrepreneurs“ (Interview – Markus Hill)

From the 25th to the 27th of June, the Fundforum International will be held in Copenhagen. The independent industry expert and IPE D.A.CH author Markus Hill will host a Family Office panel discussion there again this year. This panel will discuss topics such as due diligence of products, fund boutiques, real assets, trends in the family office segment and apparent “hype” issues such as ESG, SRI and impact investing. Enlightening discussions arose on the subject of sustainability at the LRI Investment Summit on 5th June in Frankfurt (pictured), where he served as the summit´s moderator. Aspects of the discussion will be briefly discussed in the following, matching the excursus “Frankfurt for Beginners” (book) and networking.

IPE D.A.CH: At this years’ FundForum International, you will moderate your Family Office panel discussion on Due Diligence, ESG, SRI and Impact Investing. Last year you discussed a similar topic at FundForum International in Berlin. 
Similar topics were also covered at the LRI Investment Summit. What will you discuss in Copenhagen this time?

Hill: Since 2013, I have been supporting panel discussions at the FundForum International Panel on topics such as fund boutiques, family offices, product management and fund selection. Regardless of the topics chosen, every panel is fundamentally different or a new panel, given the different combinations of panelists. In Copenhagen, I am looking forward to another challenging discussions with Marcel Müller (HQ Trust), Christoph Kind (Marcard, Stein & Co.), Florian Schmitt (Schmitt Group) and Frederic Guibaud (AlphaBet Asset Management). This year it is interesting that the perspective of single family offices is being discussed more actively. Of course, I will not anticipate the input of participants here. Topics that are always available are the selection of products, the range of liquid, non-liquid investments and the fields of direct investment versus “packaged products” like funds etc. The traditional investments will also be discussed. In terms of: What is currently interesting for family offices? Which topics are currently in the foreground? In which products are family offices involved in managing products, offering their own solutions? The importance of club deals and co-investments were also discussed last year in Berlin, as well as at the LRI Group event in Frankfurt two weeks ago. Of course, the topics ESG, SRI and Impact investing offer a spark to discuss the general developments, markets trends, hype vs serious trends – actually, this is not that crucial. In my opinion, these topics have a positive effect on the dialogue between investors and product providers, because the topic of long-term thinking is increasingly becoming the focus of discussion. A core issue, which has been a major focus since 2004, though the theme bank, fund boutiques, independent asset management and family offices – keyword ownership approach and value investing (Prof. Carlos Jarillo, Acatis, Shareholder Value and more). Private wealth, entrepreneurs and even millennials act as catalysts for a fruitful dialogue with a stronger focus on the common good. As a studied economist, I watched this discussion with great enthusiasm. Regulation too, works sustainably in this direction, so to speak.

IPE D.A.CH: What were your impressions of the Investment Summit regarding this topic? Were there differences, other focuses of the discussion?

Hill: In Frankfurt various topics were discussed. In the first session of the event, short presentations were given by Frank de Boer (LRI Group), Prof. Dr. Martin Hellmich (Deloitte) and Anton Bonnländer (Bank für Sozialwirtschaft) with regard to topics such as Investment Market, Artificial Intelligence (AI) as well as ESG, SRI and Impact investing. While topics such as Luxembourg as a hub for the fund industry, the importance of AI for the measurement of carbon risks in securities portfolios and the topic of measurement criteria in the areas of ESG and SRI were discussed in greater detail. In the second part of the event, there was “my” Family Office panel with Dr. Thomas Rüschen (Deutsche Oppenheim Family Office AG), Ralf von Ziegesar (FOCAM AG) and Christian Stadermann (Logos Patrimon). The topic fund boutiques, which for years has been increasingly interesting for independent asset managers was also discussed. Regardless whether the discussion revolves around liquid or less liquid products, the clash for many decisions seemed to be “Ownership structure” for both investors and providers. In a nutshell: The Family Office view: Entrepreneurs understand entrepreneurs and like to invest in entrepreneurs. The seeding of products on the Family Office side was not explicitly excluded but viewed very critically. For example, investing in a venture capital fund that seems tangible and understandable to the investor from the underlying (real economy), rather than a liquid fund made up entirely of “abstract” financials, futures and options, etc. As LRI Group also had a number of fund initiators represented in the audience, the quality of the pitching papers for seeding and distribution was once again discussed. Konstanze von Ziegler (KPMG Luxembourg) subsequently presented a panel on real assets, trends, tendencies and outlook for this segment. Participants in her panel were Dr. Alexandra von Bernstorff (Luxcara), Tobias Giesser (Partners Group) and Dr. Ralf Schnell (Siemens Fund Invest). Again, the tenor of the discussion was that in addition to the interest in the major players in the market, the investor side is increasingly looking for offers of boutiques in the private equity sector. Topics included the increasing duration of investment holdings as well as the growing importance of technology in the development of the Private Equity investment segment, as well as the growing demand for debt finance. The panel of Dr. Ziegler additionally intensively discussed sustainability. The discussion was animated here by the remark of Dr. von Bernsdorff, that perhaps many players in the market do not know enough about the importance of the transformation of the energy market; perhaps they also do not understand exactly what is relevant in the area of ESG. In the previous panel, this issue was less emphasized. “What are we talking about here, every medium-sized entrepreneur thinks sustainably!” as spoken by Anton Bonnländer. The impression arose that perhaps technical discussions should be fought even more intensively to the precise definition of terminology, boundaries and meaning. All these aspects that can positively influence the discussion value of such event formats should be taken into consideration.

IPE D.A.CH: What are you currently engaged at work?

Hill: Due to a mandate, for example, I am more intensively involved with the theme fund boutiques, SRI and ESG aspects (“beauty contest”). Here a special market segment will probably develop. An outflow of this project or search could be that this issue could be the topic at the 2nd Frankfurt fund boutique exchange of ideas. At the moment I am increasingly talking to investors about the topic of Due diligence in this segment and have heard “amazing” things, however I would not like to anticipate the substance of this section as of yet. On October 16, I will be accompanying a panel at the Private wealth Germany Forum (Marketsgroup) in Munich. Participants will include Marcel Müller (HQ Trust), Antje Bieber (FERI Trust) and Daniel Kerbach (Merck Finck Privatbankiers). There will be a discussion about the importance of alternative asset classes and a discussion at the interface of Family Offices, Private banking and High Networth Individuals (HNWIs). Private Equity, Real Estate, Hedge funds, Cryptocurrency, Green Bonds and Impact Investing could be topics of discussion. As I said, the discussions at the interfaces are often very interesting. It´s a pleasure to point out links between audiences and product providers that often do not seem so obvious at first.

IPE D.A.CH: Events in Frankfurt, Copenhagen and Munich often lead to a fruitful exchange of ideas. As an “exiled Rhinelander”, you have a reputation as being very biased as far as Frankfurt is concerned. Are there any new impulses to the city, networking and other outside of the box perspectives?

Hill: The world is not just about finance. Currently I am reading a book “Frankfurt for Beginners” (A tour through Frankfurt by Matthias Arning and Eva Feuchter). Quotation to Frankfurt from the book: “People often end up in Frankfurt by chance – or to make money. It tends to start as unromantically as that. However, once they get over the initial shock, most realize: Life in Frankfurt is not just about work, it’s about enjoying a great place”. To put it a little more neutral – Frankfurt, Copenhagen and Munich offer a lot of entertainment value beyond the respective “conference room flair”. A journey through the history of the city sites is more than worth it along with viewing the local attractions too. One or the other perhaps, will gain a very different perception for Frankfurt (Bankfurt, Mainhattan & Trenchcoat City) when reading such an entertaining material.

IPE D.A.CH: Thank you for the interview.

Source: www.institutional-investment.de
Photo: www.pixabay.

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