Facts, figures, insights by Patrick Loepfe, Chairman and Co-founder of GENTWO

 

As a market professional from the structured products business, I always was keen in thinking outside the box, and therefore the idea for GENTWO was generated by actually looking at how the structured products market work, how we can optimize that, and basically in essence, take out the white sheet of paper and try to combine the existing and well-working components in a more efficient way or in a different way, such that it "fulfills in a disruptive style", just the basic requirements of our target clients. 

[00:00:40] Our business developed quite well and is accelerating. Even more this year, even though due to the COVID crisis, everyone sees a bit of a downturn. We also see that, but we were really happy that we could increase since beginning of the year our asset base from 300 million to 500 million assets under administration. We also increase the number of platforms by 30% to 90 platforms and in the product base, we almost could increase our products by 40% to currently more than 160 products. 

[00:01:19]Our initial target group was actually financial intermediaries that didn't change, but we thought that our main targets are independent asset managers, and our main offering would be AMCs on bankables because we would have an edge in those products, but quite quickly, we realized that we are having an edge in private markets. So besides the standard AMC business, which we are doing, nevertheless, we did 50% of our products in private markets. And we can see that this becomes more and more important. We see that because bigger players like UBS, Julius Baer, or VP bank from Lichtenstein are moving into those spaces by dedicated teams.

[00:02:14]Obviously most of our clients are Swiss-based. That's also where we do our marketing efforts, but by word of mouth, we have already 20% non-Swiss clients, all over the world, but namely from the US , from Southern America, from Israel,  obviously around Europe.

[00:02:36] The clients from French part of Switzerland were, in the beginning, a bit underdeveloped, but within the recent months, we actually doubled the number of clients. Also, thanks to the appointment of Pierre-Noel Formigé, who does an awesome job in developing our presence in the French part of Switzerland.

[00:03:00]  When I look at our client base, we see two distinct types of clients that have different uses for our services. One group of clients is looking at alternatives in the bankable AMC sector. So they look for different custodians, probably a solution that has no banking issuer risk. And the other parts of our clients look for simplify the process in investments into alternative or private market investments.

[00:03:34]  We usually follow the passion of our clients. So our clients come up with new topics, we couldn't think of, for instance, like Barry's Films, with the movie and TV series seed financing or other parties that do forestry investments, so investment in trees, or other people that work on more platform-style of business that can combine private debt with private equity and listed equity investments, or the businesses doing investments in startup gold mining and securitize that in an efficient way. And that keeps actually also us going because we see the passion coming in and we see the many different colors that people could apply to our white canvas and draw amazing things with it.

[00:04:33]In the beginning we started really with bankable AMCs. So most of our products were bankable AMCs, but quite soon, people also Developed ideas around private markets investments or alternative investments. And therefore we have right now almost 50-50 alternative investments and bankable investments. Let's say two-third of our products are  AMCs that being said, AMCs on bankables and non-bankables. So it could be an AMC in traded shares or future trading, but it could also be an AMC that invests private equity and private debt. Hybrid structures are possible. One-third of our products are credit-linked notes, we invest in private debt and our clients add nice features like security in forms of collateral or special types of linked coupons. For instance, a coupon link to an outcome like a pay per use coupon payment, or investment. And obviously we also have normal trackers that just transform an asset into a bankable asset.

[00:05:42]  We believe that within the coming months, we will see a lot more private markets investments, a lot more private banks and wealth managers moving into that space. And we have just the perfect offering for that. We will see more people moving away from the traditional limited partnership into our solution because we have better ways of aggregating client investments via our standardized contracts compared to those bespoke partnership models that we saw in the past.

[00:06:21]We saw within the last two years that around 20% of our clients are international clients, even though we didn't do much marketing. That's why we believe there is also demand outside of Switzerland and there we clearly follow our clients.  We have clients already from the US, we have clients from Israel, we have client demand also from Asia. We want to follow our clients and build a presence where our clients already are.

[00:06:54]We are actually quite proud of our diversity. So out of the 22 employees, we have 12 nationalities, we speak 15 languages and we have 40% women in our workforce. Furthermore, most of our management roles are occupied by women.