Geneva-based investment advisor sees an “acceleration in number of private market investments” among HNW clients, as well as increasing interest in digital assets
High-net-worth investors across Europe, Asia, and South America have placed faith in private markets specialists over the last 18 months, as illiquid investment opportunities were seen as a safer bet during the uncertainty of Covid-19.
Sherban Tautu, Head of Liquid Alternatives at Geneva-based investment advisor Syz Capital, described: “an acceleration in the amount of private market investments,” which he himself has advised on, telling Private Equity Wire that the firm has found a sweet spot among smaller and more esoteric strategies.
“It would be easy for me to advise my clients to work with the biggest private equity managers, such as Blackstone, KKR & Co. and The Carlyle Group but, in the private markets space, I prefer smaller and more nimble fund managers who can still access the juiciest part of the returns – that’s important to my clients.”
Syz Capital advises on CHF1 billion for a small group of families based across Europe, Brazil, the Middle East and Asia. The firm’s average client portfolio ranges from USD100-200 million, of which it manages anywhere between 10-30 per cent of these assets.
Tautu explained that of the firm’s total investments, 40 per cent are currently in circa 20 private equity managers. With its manager selection, Tautu said that the company tries to find experts in specific industries, such as food tech, music royalties, and law firm lending.
Despite the uptick in private markets investment, there remain reservations, particularly around opaqueness and longer lock-ups.
Tautu commented that his clients “like to take risks in these private markets, but the idea of being blocked for 10 years is still frustrating to them.”
On lack of information, he said that, within the private markets, “there’s not always the same level of access to information as in the public markets, and it’s frustrating to them (clients) when they feel that they don’t have sufficient information from their private market investments.”
Tautu expects HNW clients to persist in their search for niche, decorrelated and digital private market assets.