Moonfare Insider Talks Episode 01: Azeem Azhar

Azeem Azhar is an investor, entrepreneur, best-selling author and creator of Exponential View, a leading newsletter and podcast on technology’s future. Known for spotting emerging technology like DeepSeek, he’s been at the forefront of tech’s impact on society. His work has appeared in the Financial Times, New York Times, MIT Technology Review and more.In this conversation, Azeem joins Mike O’Sullivan, Moonfare’s Chief Economist, to discuss:- How AI has developed over the past five years- Strategic AI race between the US, Europe and China- Whether AI is driving compounding economic shifts, affecting industries, labor and productivity- AI investment growth: where smart capital flows and trends that Azeem seesAzeem and Mike finish the session with a Q&A submitted by webinar guests.Learn about our upcoming live webinars: https://moonfa.re/471QVQp

Nic Humphries is one of Europe’s most prolific technology investors and the Senior Partner and Executive Chairman of Hg — a specialist in enterprise software with over $75 billion in assets under management and a portfolio of more than 50 companies.Nic became part of Hg in 2001, where he also served as CEO for ten years before assuming the role of Chairman in 2017.In an interview with Steffen Pauls, Moonfare’s CEO and Founder, Nic talks about what makes a capital compounder, the investment strategy behind great portfolio companies like Visma and the thought process that drives the firm's approach to exits — along with many other topics. Here are some of the key takeaways:What makes a great capital compounder?“The very best businesses have a great home market, offer the best quality products and services and attract customers who flock to them. However, that’s not sufficient to make a compounder. These businesses also have the ability to invest excess capital consistently over decades. There’s not a lot of these companies.”Investment case for Visma“Visma started as a leader in small business tax, accounting and payroll software in a small number of countries. We recognised we had the potential to transport that capability to many other markets. However, to do that you have to understand the culture, the tax and compliance rules in other countries — essentially you need to know how to operate in a local way and Visma had that from day one.”Hg’s approach to exiting investments“In an average portfolio, you have some good exits early on and poor investments that are left at the end. But that’s like cutting the flowers and watering the weeds. We wanted to reverse that by acknowledging that unfortunately, some investments won’t be so good, and selling them early to drive DPI and cash. You should then keep better investments for later.”Advice to his younger self“Pick a sector that will be growing for the next 10, 20 or 30 years, where the winds are at your back. I grew up in a mining town and lots of my friends went to work in the local pit. And I could have been the world's best miner and still wouldn't have a job today. But you could have been a very average software developer and you’d still do okay.”Important notice: This content is for informational purposes only. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

Founded in 1985, Permira has invested around €75 billion in hundreds of businesses worldwide from a platform that spans large-cap private equity, growth equity and credit strategies.Brian and Dipan have played key roles in expanding the firm’s global presence and diversifying its investment strategies.In their conversation with Steffen, they shared insights into their transition to co-leadership, their outlook on the private equity market and Permira’s approach to take-private opportunities.Here’re some of the highlights: Benefits of a co-CEO model“The art of leading is about how to make high-quality decisions in a reasonable period of time. A co-CEO model allows us to share ideas, challenge each other and ultimately helps us make better decisions faster."The appeal of private equity “Private markets have been successful because they offer high alignment and control in how businesses operate. Their timeframes — typically a 7-year-plus horizon for creating value — is hard to achieve in public markets where shareholders want to see quarterly progress on pretty much every initiative.”Opportunities in take-privates “Public markets are great if you’re in private equity. There’s a level of inherent ‘short-termism’ in public markets where 70% of activity is driven by computers. Meanwhile, the world of long-only fund management is becoming smaller, which creates more volatility but also generates many interesting opportunities for take-privates.”Success in the consumer sector“We are looking for brands with great products that people love and where we see the opportunity to do something fundamentally different. Golden Goose, for example, had only a small presence in the US when we invested. It’s now a significant part of the business. Previously, the company's revenue came almost entirely from footwear, but now a meaningful percentage is generated from non-footwear products.”Important notice: This content is for informational purposes only. The opinions expressed by the interviewee are their own. They do not purport to reflect the opinions or views of Moonfare. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

Robert F. Smith is the Founder, Chairman and CEO of Vista Equity Partners, an investment firm that specialises in enterprise software. Originally from Colorado, Smith began his career as an engineer before moving into finance, where he developed a focus on the tech industry.Under Smith's leadership, Vista Equity Partners has grown significantly, currently managing over $100 billion in assets. The firm is known for its approach to improving operations and driving growth in its portfolio companies.In a conversation with Steffen Pauls, Moonfare’s Founder and CEO, Smith shared his views on the rise of generative AI, the future of enterprise software, market trends in private equity and the advice he would give his younger self. Here are some of the highlights:The vast potential of software “Software continues to be the most productive tool introduced in the business economy in the last 50 years. Businesses have found that their next best purchase is to buy more software which can enable them to increase productivity and efficiency.  I thought that would be a good place to start investing capital. That’s why I started Vista.”Seizing take-private opportunities “For the first time in quite some time, enterprise software companies have become more affordable in public markets. That’s why we have completed many take-privates in the last 18 months. We look for companies that have product superiority and execution excellence capabilities but have, in some respects, fallen out of favour with public market investors who have turned their attention to generative AI-focused companies.”Investing in private markets “About 97% of software companies are private, and the vast majority of investors and consumers don’t really know that because people don’t necessarily talk about enterprise software. Privately owned software companies can take a longer-term view on the application of tools like generative AI, enabling them to better navigate innovation cycles.”The importance of being curious “The advice that I continue to support is to remain curious. Continue to expand the aperture of relationships early and learn from people who apply new thoughts and technologies, and see how you can apply them to the work you’re in.”Important notice: This content is for informational purposes only. The opinions expressed by the interviewee are their own. They do not purport to reflect the opinions or views of Moonfare. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

Hugh MacArthur is the Chairman of Bain & Company’s Global Private Equity Practice, which he helped establish over 25 years ago. With a wealth of experience advising private equity funds worldwide, he has been involved in hundreds of projects focusing on deals, strategy and operations. A recognised thought leader, Hugh is also the host of “Dry Powder: The Private Equity Podcast”, dedicated to discussing key industry trends with leading experts.In a conversation with Steffen Pauls, CEO and Founder of Moonfare, Hugh shared his thoughts on how the private equity world has changed and what’s coming next. They covered everything from current market conditions and secondaries to fundraising trends and emerging managers.Here are a couple of highlights from the interview: Public vs. private markets“In the public markets, you get 90% of the money but only 10% of the global investment opportunities. In the private markets, it’s the opposite. The room for growth in private markets is absolutely massive. The question is, what education is required to give people the confidence to invest in these markets with names they don’t necessarily know or understand?”The liquidity question“Markets need to recover. There needs to be an acceleration in exits, which would put money back in LPs' pockets. It’s a multiyear issue, and it’s not going to get better in three or four months. There are too many companies, and too much value needs to come back. It doesn’t have to be fully solved though, but we need to be on the path of solving it.”On investing in secondaries“It’s a fantastic time to invest in secondaries. It is absolutely a growth market with an asset class where even the entire fourth quartile generates positive returns. When we do surveys with institutional investors, they all tell us they’re planning to increase allocation to secondaries.”The power of AI“I have no doubt that in a few years, some industries will be fundamentally reshaped by the ways AI is being deployed. But for now, it’s important to understand what technology can and still can’t do for businesses. This is what many GPs are exploring in partnership with management teams.”Capital at risk. Moonfare does not provide investment advice. All views expressed by the interviewees remain their own.Important notice: This content is for informational purposes only. The opinions expressed by the interviewee are their own. They do not purport to reflect the opinions or views of Moonfare. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

In this Deal Talk conversation, Steffen Pauls, Moonfare’s founder and co-CEO, and Mike O’Sullivan, chief economist, explore the current technological revolution that promises to surpass the internet and the smartphone.Is this all just hype, or the dawn of a new era? Drawing parallels with the early 2000s internet bubble, the pair provided insights into the future trajectory of AI, addressing whether we might see a similar pattern of euphoria followed by a period of stagnation before substantial growth.Here are some of the key takeaways from the conversation:Domain of private marketsWe’re on the cusp of a new technology. What’s different compared to the internet era is the financial market behind it. The internet was effectively the child of the equity markets. AI is the realm of private markets.ReinventionAI is not only disrupting the broader economy. It’s also a fundamental disruption for the entire private market industry — from buyouts to growth and venture. The industry needs to reinvent itself both in terms of how they apply AI to existing portfolios and new investment themes.PE’s focusData centres are a major focus for private equity, as well as cloud infrastructure, AI models, and digital tools. Private equity managers are also very active as owners — half of PE-backed companies are investing in AI, compared to family-owned companies, where this number is 27%, according to Deloitte.AI’s role in turnaroundsPE has done very well in terms of returns over the past decade — some of the performance has come from leverage, but now attention is shifting to business turnarounds. A lot of these turnarounds are AI-driven in the sense of operators using data and analytics to understand consumer behaviour and to analyse where the business has gone astray.Important notice: This content is for informational purposes only. The opinions expressed by the interviewee are their own. They do not purport to reflect the opinions or views of Moonfare. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

The seasoned private equity dealmaker joined Steffen Pauls, Moonfare’s Founder and CEO, in another edition of the Deal Talk interviews. Christian Sinding is the CEO and Managing Partner of EQT, one of the largest private equity firms globally. With over 25 years of experience, Sinding has been instrumental in driving EQT's growth and expansion, focusing on sustainability and long-term value creation. Today, the Swedish private markets heavyweight manages companies and assets worth more than €230 billion. It generated over €2 billion in revenue last year and employs almost 1,900 people across the world. In a conversation with Steffen Pauls, Moonfare’s Founder and CEO, Sinding discusses a wide range of topics — from the opportunities in artificial intelligence to EQT’s culture and future plans. Here’s a couple of highlights from their conversation: Scandinavian curiosity and American mindset “We Scandinavians like to think of ourselves as having big ears and a small mouth. We're pretty good at engaging with people and listening. You need to do that coming from a small country to engage with the world because your whole market is too small. And for me personally, I think that kind of curiosity that comes with that approach has helped me a lot. And then I think I’ve also brought with me the forward motion that the Americans have. So I am kind of a product of both worlds.” Making businesses better “We've never been financial engineers. We've never been the ones that have used the most leverage either in our portfolio companies or in the funds. We think you can generate consistent long-term returns by making companies better, stronger, faster, bigger, more international, more innovative and more sustainable.” The big opportunities “We are excited about the digitalisation of society which is now massively accelerating again with artificial intelligence. These opportunities include data centres, fibre broadband and everything else related to digitalisation. The energy transition is also huge — the energy systems as well as transportation. We own the largest ferry network in the world, which started in Norway. But it's not really about owning ferries, it's about decarbonising the entire ferry fleet, turning it into an electrical bridge that's quiet and environmentally neutral.” The ‘why not’ attitude “I've always been the ‘why not’ person. You get some kind of challenge or opportunity and you're not sure whether you want to do it or not? Just go for it. Could I have told you when I was in college that I was going to be the CEO of a big private equity firm? Of course not, not even close.” Important notice: This content is for informational purposes only. The opinions expressed by the interviewee are their own. They do not purport to reflect the opinions or views of Moonfare. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

The iconic private equity leader was the guest of our first Deal Talk in 2024, hosted by Steffen Pauls, Moonfare’s co-CEO and Founder.David Rubenstein is the Co-Founder and Co-Chairman of Carlyle, one of the world’s largest and most successful private investment firms. Established in 1987, Carlyle now manages $382 billion from 28 offices around the world.Rubenstein's career spans law, government service and finance. Before co-founding Carlyle, he practised law in New York and served as a domestic policy advisor to President Jimmy Carter.In a conversation with Steffen Pauls, the iconic investor shared his thoughts on a wide range of topics, from private equity’s outlook to evergreen investing principles and leadership traits. Here are some of the highlights:Private equity in today’s economy. “It’s harder to get loans than it used to be because of the interest rates. It’s also harder for buyers and sellers to agree on a price — there’s been a mismatch of 10 to 20% in terms of valuations. But I think buyers and sellers will come closer this year as interest rates come down. I also think you’ll see more deal activity.”The future of the asset class. “As a general rule of thumb, if you go with good private equity people, you are likely to outperform public equity. This trend will likely continue. There’s also going to be more private equity in the emerging markets such as Latin America, Middle East, Africa and Asia. You’ll see more private equity there over the next 10 years and therefore more opportunities for people to make private equity returns.”Democratisation of private equity. “You're going to see people invest a certain amount of money in private equity through 401(k)s, IRA or equivalent retirement accounts in Europe and elsewhere. These won’t be large amounts and likely won’t do poorly. In the next 10 years, almost everyone will have the ability to invest in private equity if they want to. But democratisation is not easy to achieve and it takes time.”Key investing principles. “Most important principles are diversification and having realistic expectations about rates of returns — don’t believe they will be as high as someone might tell you. If you expect a 50% internal rate of return, it’s more likely to get a zero rate of return. Also, rely on good money managers. These managers have reasonable fees, are transparent, have a track record, reputation for integrity and are able to retain good people. Examine the people you’re investing with but give money to good ones to manage.”Skills for success. “Specialisation is very important. If you really want to make a mark in private equity, take a small area and make it your own, become an expert in it. In addition, treat your investors with respect through good and bad times, don’t be arrogant with them when you’re doing well. Be humble and make sure to give them information all the time.”‍Powerful leadership traits. “Persistence is everything. If you fail, pick yourself up and get back in the game. You typically need to have communication skills — to talk well, write well or to lead by example. Great leaders also know how to get things done. And they persist, persist, persist.”Important notice: This content is for informational purposes only. The opinions expressed by the interviewee are their own. They do not purport to reflect the opinions or views of Moonfare. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

In conversation with Moonfare, General David Petraeus, the former Director of the CIA and decorated US Army leader (Ret.), spoke about current geopolitical frictions, economic uncertainty, the implications of artificial intelligence and more. Now serving as a Partner at KKR and Chairman of the KKR Global Institute, General Petraeus recently joined us for a macro-themed episode of our Deal Talk series, hosted by Steffen Pauls, the Founder and co-CEO of Moonfare. The pair discussed current geopolitical developments, their broader context and the impact these have on economic stability and private markets. The main highlights of this fascinating conversation include:  The success of Europe in easing economic woes. “In the case of war in Ukraine, there were worries of significant [economic] ramifications — in Germany, in particular, given its dependence on natural gas pipelines from Russia. The country had to go through a considerable effort to reduce this dependency. And has done that very impressively, cushioning the blow of higher costs of electricity for citizens and sought to do the same for major manufacturers. (...) By and large, Europe has done quite an impressive job responding to the sudden change to Russian energy exports.” Making NATO great again. “Truth is that Putin set out to make Russia great again. But he made NATO great again by pushing historically neutral countries into seeking NATO membership, one already in Finland, the other one [Sweden] on the threshold of that membership.”  On the US relationship with China. “We continue to compete where we have to and strive to deter. Deterrence is the function of two elements — the potential adversary’s assessment of your capabilities on the one hand, and your willingness to employ them on the other. We have to ensure there is no question of that in the minds of decision-makers in Beijing. Not that we’re looking for a fight, we want to avoid a fight or conflict.”  The transformative nature of AI. “By and large, artificial intelligence (AI) will be transformative. We’ve gone through various exercises at KKR where we looked at every sector in which we invest. [...] AI will have transformative effects in many of these. It will dramatically improve productivity and efficiency and literally how we do everything, not just in our work but also in our daily lives. But it's going to take time, it will be uneven and it’s not always as predictable as one might think.”  The importance of information for investors. “We’re in an era that can be described as renewed great power rivalries. Barriers are going back up. There are great economic concerns and geopolitical risks. Globalisation has become “slowbalisation” and regionalisation. In this world, you have to have a very informed view of different trends and how they affect investment opportunities.”   Important notice: This content is for informational purposes only. The opinions expressed by the interviewee are their own. They do not purport to reflect the opinions or views of Moonfare. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. Private equity is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility. Please see https://www.moonfare.com/disclaimers.

Søren Vestergaard-Poulsen was the guest of our 12th edition of the Deal Talk series, in which Moonfare’s CEO and founder, Steffen Pauls, talks to some of the world’s most prominent names in private equity dealmaking. Søren, who joined CVC in 1998, is a managing partner and co-chairs CVC's private equity board and oversees private equity activities in Greece and the Nordics. He plays a pivotal role in managing a firm with 25 local offices and €161 billion of assets under management. In their conversation, Steffen and Søren discussed a wide range of topics, from CVC’s approach to sustainability to its distinct organisational culture. Here are some of the highlights: CVC’s investment playbook“We’re trying to find investments that are robust and where we have a clear value creation program to make these businesses better. If we can do that, we’re more than likely to make a good investment.” The superiority of the PE ownership model“The alignment of interest with management, the long-term approach to value creation, and the drive from the board level to create value are much better in private equity than in any other ownership model. Compared to when I joined, not much has changed either. It continues to be a superior ownership model and will stay that way in the years to come.” Immediate outlook“I think we’ll see a pick-up in 2024. We are already seeing the divergence in price expectations between buyers and sellers narrowing. And in terms of financing, banks are coming back to the market. We’re starting to see improvements.” What you need for success in private equity“It comes down to whether managers making investments know what they’re doing. If you are a sector fund, you need deep expertise in the sector. If you are a generalist fund, you need to be able to source the right deals and generate the value creation plan again and again.” Important Notice: This content is for informational purposes only. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Opinions in this interview are not Moonfare's and Moonfare do not take responsibility for this. Past performance is not a reliable guide to future returns. Your capital is at risk.