Alexa Binns 00:02
We are so pleased to hear from Vishnu amble, the founding director, trustee and Investment Committee, member of green bear group. This is a single family office and a mission driven investment platform. You’ve lived on six continents, in 12 different countries, the rise of values-aligned investing, and what you’re looking for in managers today, when some of this sustainability or impact is a little less out of favor of what you’re still interested in and why?

Vishnu Amble 00:56

Alexa Binns 00:59
to begin. We’d love to hear your path from traditional finance to this globe trotting career that you’ve had. Would you mind giving us sort of the highlights?

Vishnu Amble 01:14
I started my college career in the.com boom, which then busted the era and in semiconductors. So I attempted to study Electrical and Computer Engineering at the University of Michigan, and this is also where I had met the entrepreneur whose family office I run currently. It was during college, and I was helping out. I wanted to work there in a startup. I didn’t want to be in school. I wasn’t very excited about sitting in a classroom. I wanted to get to work quickly and get my hands dirty, and that was a fascinating experience. But.com bullet busted. No one wanted to be in tech. Certainly no one wanted to be in semiconductors at the time, and so I was fortunate to have some connections in financial services, did some internships with investment banks and took the traditional finance route without really any training. I didn’t train in any, you know, accounting, Excel, modeling, any of that stuff. So, you know, it was just some engineering background, expertise or experience in tech. And then I, you know, I joined an investment bank and then made my way through, through private equity but, but always covering technical industries.

Earnest Sweat 02:43
What kind of impression did you make at such an early age? You know, it

Vishnu Amble 02:56
I just knew this person was working on a startup. There was a connection to a Japanese tech company. Remember Japanese companies cut down research and development in the 90s, after the peak of the market there. And, you know, there was a lot of IP that was lost. And I was just fascinated with that, and knew this entrepreneur was working on something, and I said, I don’t care what it was like. I want to be part of this, and I don’t want to go through school and just sit and fall asleep in a classroom. And so I kept persisting. Said, I want to work with you as an intern, whatever it is, but I want to do this. And this is 1999 to do this. And so that’s how this all originated. And then brings me full circle back to where I am here. So it’s, it’s interesting, and really, you know, when I think about, and just for anyone, just letting lessons learned, you know, I had a CV that was very confusing, you know, I had done tech, you know, I had done, I’d done, I covered utilities. I’d covered semiconductors and software. And you know, these are totally different types of industries, and now you’re really seeing them come together, right? I mean, everyone’s talking about power generation utilities, the consumption of energy from data centers, the use of microprocessors, and the sophistication of convergence is now fascinating. It’s really, it really rolls in and integrates my career experiences at this time.

Earnest Sweat 04:39
You’ve lived on a ton of continents, tons of countries, and now you’ve worked in a lot of industries. How has that all shaped your LP, perspective,

Vishnu Amble 05:13
I want to compete at the highest levels. I want to see the table. I know I’m not going to be the best investor, the best fund manager, the best operator, the best at technical BD or inside, the best financial modeler. So I’m not going to be on the court. I’m going to be on the bench if I’m on the court. So what am I going to do to have a seat at the table with the best you know? How am I going to compete at the highest levels? And for me, it’s network and market knowledge and insights. And this is what I have done for 20 plus years. And really weaving that together is being able to talk about markets around the world. And so when we back managers, when we see them, I say, I will bring you a network. I’m not going to be the best on the investment side, or I can advise on best practices. I can put you in front of the right people, but it’s network, that’s what I’m bringing, and it’s anywhere in the world, and that allows me to have that seat at the table with the best out there, it’s not because I’m a great fund manager deal America and that stuff, you know, I just trot along, but I don’t want to be in that junior varsity class. I want to compete in the professional leagues.

Alexa Binns 06:35
you have worked at smaller startups. So I think it’s also a great reminder to our audience, primarily of GPS, that you know the person you’re talking to may actually be smarter on this topic than you are, particularly given that you have a lot of lived experience on some of these trendier topics around AI. So with that, I would be curious to hear what you’ve made at this point, sounds like about 10 manager investments. And is there a story you can share there of an investment that you’ve made and why, or what was compelling about the manager you selected?

Vishnu Amble 07:50
So yes, it’s over 10 that’s direct on the seating side, and the idea, and then done staking directly as well, and then now more so, through funds, through managers and CO, invest alongside. But the idea is, we’re not just traditional allocators, right? We’re entrepreneurial investors. So it’s again, the partnership. How do I come in and partner with the best, take them to the next level, but bring complementary skills to that group. So they may be great investors, great operators, and say, how do we institutionalize you, and how do we take you to that next level? And capital is a big part of that, right? If I say, you know, if I’m in Hong Kong, so there’s 31 insurance companies in Hong Kong, 23 primary insurance, eight reinsurance companies, if I go to Hong Kong, and I say, here, you know what, manager XYZ, they have a they have a very attractive profile for these insurance companies. We get together 15 to 16 of those for a dinner or luncheon. And it’s remarkable what you see from that. If you know, I have to believe the manager, but I tell these people, I’m in, you should come in too. We’re all aligned here. And yes, do I see value accrual if they raise money at the management company level? Absolutely, you know, I’m unabashedly capitalist and that is the objective, you know, and you could do great things if you can, you know, if you have great access and great performance, right, then you can have great impact. You can fund these missions that we have. But you know, you really have to separate this. Something we’ve learned the last 20 plus years is you have to separate the two, right? So, what is the objective, and then what are you trying to achieve? You know, what does that impact? When we’ve tried to put those together, we’ve really struggled, and that’s a lesson learned.

Earnest Sweat 10:17
how did you determine, you know, even wanting to start a seed seeding program, or, you know, your movement into the US venture market, more now as well? Like, how did that process come off? Like, hey, we see an opportunity. We need to leverage it.

Vishnu Amble 10:39
So what we learned when, okay, working in a startup that had a lot of downs, some ups, many downs, was very challenging. Then we tried backing startups, saying we couldn’t do it necessarily right, operating, let’s try to back startups. We tried different models that did not work. It’s tough, right? Startups are tough. So I said, Okay, you know what let’s do as managers. It’s a little more risky. And then let’s just think through how we can add that value to increase the probability of outsized outcomes and decrease the probability of just sub standard or sub beta outcomes. Let’s say that’s how we transitioned over time, just taking lessons learned, we’re not I mean, just backing startups was, was, was very challenging. And so just taking those lessons learned, incorporating say, Okay, again, where is ours to the table? Why should I be sitting at the table? And as soon as we realized what we can do, what we can’t do, that was very important. The same thing with how we operate now is outsourcing. Many of the functions, a lot of people think they can do themselves. You got HR issues, you got IT issues, just organizational issues. Now with costs and the just model that has of outsourcing that’s working, plus you have firms that are really up, you know, on the, on the cutting edge of what’s happening with AI, how AI can be integrated and how tech can be integrated, to advance the, you know, to advance the outcomes of these, allocator, stamina, etc, trying to do it in house is very difficult. Yeah, I think that’s really important. It’s just again, knowing what you can do and can’t do. So, put your ego aside and say, what is the outcome that I see and what is the best way to achieve it with the lowest, highest probability of success versus failure, absolutely, and then manage expectations.

Alexa Binns 12:41
What should we all know that LPs are telling each other right now?

Vishnu Amble 13:05
I’m active with the institutional limited partners Association and on the messaging board. It feels like over half the time people are asking each other about it. What’s the best solution for whatever objective in that journey. CRM, you know, to do maybe reading, reviewing memos, reviewing documentation. It’s just a constant, and no one has an answer. And this is for us, is so important. I mean, we’re using solutions from two decades ago that just keep getting augmented, but certainly not optimal. We’re overspending on it. I could cut costs down 60% and again, if I outsource too, I can cut the cost down. And in doing so, I could be much more efficient. I could reinvest that capital, and I can back work with a firm that’ll be on at the forefront of tech

Alexa Binns 13:59
development, who’s building that? We’ll get them on as a sponsor. We’ll find them for you. Vishnu,

Vishnu Amble 14:06
so you’d be surprised, like, how much OCIO firms are investing in it. Wow. It’s really an important element, and this is what family offices and similar allocators are seeking. But it’s just a matter of, can they do it in house? Do you want to build all that in house? Then you have the person leave? Yeah, they want to start their own firm. So turnovers, we’re long term capital. I can’t have people turning over or seeking short term objectives. We’re compounding at long term rates. That’s why our IRR, our IRR, is so important, and our objectives are crystal clear.

Earnest Sweat 14:43
you spoke about how you went from building a startup hard then investing directly in startups, hard to then go into something that’s also very hard diligence in humans in an overcrowded market of venture capital. How did you develop, like the expertise in that, and how do you have your framework to make sure you’re always

Vishnu Amble 15:41
getting better? So it goes back to building on lessons learned and knowing what you can do and what you can’t do, and then empowering those who are better than you and partnering with them. And I constantly say, I can’t do everything. I don’t want to be the jack of all trades. I want to be the best at what I can be, and then bring that to complementary partners. And you know also, what’s your risk tolerance? I have always wanted to manage funds. We started fund management as relatively de risk compared to a startup. You know, at an actual startup, we’re backing a startup directly and really concentrating. Why not work with several companies through a fund management platform? That was the idea, again, risk tolerance. So my risk tolerance has gone down significantly where I may have had we touched on this earlier. Alexa, there was no concept of work life balance. It was just constant everywhere. And that has really changed over the past few years, particularly. And what’s that balance? And now, knowing what I want, what I don’t want, what I’m good at, what are the priorities, I think it will be much more effective, but the risk level has changed dramatically as well.

Earnest Sweat 17:18
What are you looking for in fund managers these days?

Vishnu Amble 17:23
So this is another great aspect of this industry. What I’ve learned is, what are those who you want to work with? Right? And, and that’s, it’s all relationship driven. So like the best, let’s say the most effective introduction or connection to a company, a manager, etc, is from other investors, other LPs. So I constantly try to build relationships with other LPs. Exchange notes say, Hey, I’m aligned. You’re a lot, and they have to be aligned. This is also very important. If it’s like a public No offense, but it’s like a public pension, there’s politics involved, right? Short term thinking misaligned with my interests. It needs to be long term investors, other family offices, potentially insurance companies, certain foundations, I’d like to say endowment. Say there’s just a lot of tension right now in the endowment world. Yeah, you’re gonna have a lot of people changing over. You’re seeing it already on the foundation side. So groups that have tenure and are not constantly turning over are really important, and that I’m sitting there at the Capitol 12 years, 17 years down the road and with the right aligned part, and that’s the real challenge. But keep building that group, and those referrals are so important, and it’s just the qualification of people, because, frankly, financial analysis reviews I can outsource that. I’m pretty comfortable at that, but it’s the people element that’s really important.

Earnest Sweat 18:46
Now we’re going to take a quick break to speak with our sponsor.

Jeremy Rich 18:50
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Alexa Binns 19:36
There are plenty of people right now that have impact at the core of their fund thesis who are. Struggling to fundraise. How? How do you recommend sort of withstanding, some of these ebbs and flows of, I guess the wind, the wind is not necessarily at your back right now, if you are a Climate Fund or if you are a FinTech fund, how do you recommend withstanding? Sort of the ebbs and flows of these, of these topics.

Vishnu Amble 20:27
So what’s really important? And I believe the market speaks for itself. So if fund managers, if I’m in Singapore, Tokyo or the Middle East, and fund managers are coming all the way from the United States, and it’s not, you know, they’re not there because of asset gathering, which is fine for a strategy or several strategies, and so there’s a place for that. But if they can’t raise capital in the broadest and deepest, most sophisticated capital markets landscape in the world, they have to come all the way overseas. Something already is just challenged, just to that. We need a filter, right? If there’s 10,000 plus fund managers out there, there needs to be a filter. I should be chasing those managers. If there’s two right now that I’m trying to close with, I’m chasing them. I had to get their top LPs to refer me. I had to do a presentation for them. I had to say what value I’m bringing to the table. I’m chasing them. That’s the hard work in this industry. If you want to be successful, if you can’t raise in your backyard, Something’s just not right. But the market speaks for itself, and I believe in that. And yes, I’m going to miss some things in the cracks, but you have to have a filter in all this, and it’s really important. And so the climate on this impact side, a lot of people just there were dollars available for themes, but these people weren’t successful operators, investors, fund managers. Frankly, anything, I don’t want mediocrity, especially if the s, p5, 100 is going to generate around 10% annually. And I don’t need the 10% it’s great. I need seven to eight annually, and that’s already why I would take risks and have a portfolio of investments that are below cost in year 15, because they raise dollars on a short term basis. It goes back to that alignment. I’d rather make as much money as possible through the primary investments, and then affect that impact. That being said, we have back there some great managers who are just fund managers right there. They have their successful fund managers where they focus on themes that have that that we’re passionate about, whether it’s education, whether it’s climate, so it’s possible, but it’s fund manager first. Yeah, that’s really not. Hey, I’m gonna check, get a box checked. Let’s do this together. I’ll get some capital. Let’s hope for the best. Doesn’t work or not, not for our interest. And you’re gonna see this really gestate over the next couple years, three to five years, particularly, of these managers really struggling.

What do you think you know when so many times we talk about the narrative of, as Alexa mentioned, that in hand fund manager, or like, Can I have some money, please? But there are instances like, when you have a correctly sized fund, you have a lot of interest, you have a track record. What should you be considering, then, as a fund manager, to have the right team of LPs backing

Vishnu Amble 26:27
you? So that’s like, what is the alignment with you as the manager and those LPs? So are they going to flake out on you? Do they change people annually, every few years? Are there politics involved? What is their cost of capital? For example, I love Japanese markets, and the Japanese LP, I think, is the second broadest and deepest capital market base in the world. But they have turnover three every three years at the end of fiscal year, March end. That’s a misalignment, right there, right? Is that healthy for the manager and the LP base, their cost of capital is much lower, is that also you you could also manage as a manager, financially engineer your way to having a safety net where you bring in all LPS with the low cost of capital because they want dollar exposure, or just bring in corporates and strategics where there really is they don’t even understand cost of capital. I don’t want to be in that LP base with that, but the manager can, you know, essentially, it’s conventional engineering in a different form. They can create a baseline of different costs of capital and play a game around that. As a result,

Alexa Binns 27:34
you’ve, you’ve got a lot of personal experience with what is motivating for LPS in different parts of the world, they’re picking sort of a favorite place where you did some fundraising of your own. There are many tactics you can share. Maybe it’s rising in Singapore, maybe it’s rising in Tokyo. What? What worked for you that was culturally relevant?

Vishnu Amble 28:01
Frankly, it’s just their persistence. It’s a long term game there. I’ve been these places 20 plus years, constantly, at the cost of my personal and mental sanity. But I have been in these places and just constantly meeting people

Alexa Binns 28:16
poor Midwestern Vishnu is like, I just want Thanksgiving. Like the real

Vishnu Amble 28:21
ingredients of a normal, you know, I just want to, I just want to see other bears game that they lose, right? I mean, that’s I there’s times I crave that. And sitting with some Chicago style pizza and and, you know, forgetting about all this other stuff, but, but you said persistence and having a plan around that that’s really important. And say, Good, I want to follow people who have capital, because I’m coming in with the other approach, access to capital and networks, as opposed to being the deal maker or the operator and bringing that to the table and then putting my own capital alongside but it’s that persistence. Now what we do is just good relationships in key markets, and they continue to foster and I’m there every now and then short trips, but I can connect with them remotely. And it’s also just building on on the brand that I have established, and now, you know, as I say, foundation, and just building on that going forward, and having a balance around this, because otherwise, you know, one, it’s unsustainable to try to do what I had done previously, and, you know, eating that, but now saying, what are best practices to really get the best outcomes that I see again, being mindful of that risk parameter, that mean

Earnest Sweat 29:39
business, been clear, you know, the couple conversations we’ve had, and even this episode today, that you know you put a priority in building genuine relationships, no matter how far you have to travel or not to do it. Can you speak to how that’s going to be an advantage as we get more into it. The world of automation, AI and people thinking they can just zoom their way into building relationships.

Vishnu Amble 30:08
You know, what’s really interesting is that there’s their AI, say AI, or whatever tool AI is, you know, loosely used phrase, the tools that are available out there in the market that you can utilize to analyze any circumstance of life. You’re gonna get a 70, 80% plus comfort level. It is absolutely fascinating. It’s just so scary, right? You can, you can use AI to do some, get some very, very, you know, dark insights as well on people, whatever it may be. So you gotta monitor, you know? And it’s somebody saying, I just don’t want to know what technology to tell me, yeah, how to leverage those tools and partner with groups who are at the forefront of tech development and then utilize that as a partnership. So as I mentioned, OCIO costs, they’ve over halved in the past six years since pre covid to now over half. So from, let’s say, 60 to 70 basis points. And I’m, internally, at about 60 basis points of cost, just just wage. Lie. How to get it down to 15 to 25 is very reasonable. Then you weave in technology, you’re looking at a 10 to 15 basis point cost with technology, what happens is human capital. This is also something that has to be assessed, how many, how much? What’s your human capital requirement? But the amount of tech out there is really fast, and gets me again, back to that that complements me within the relationship building the human element, and I can be much more effective than having 10 people in Singapore, a bunch of consultants and some back office people here in Florida. So I could cut most of that out. I believe not all

Alexa Binns 31:47
you have spent a good chunk of your career in infrastructure and energy. Is there anything you see in your crystal ball these days when it comes to investing in these spaces, obviously, infrastructure has been so hot the past, maybe, what, 1218, months, any, any sort of red flags you see, or opportunities,

Vishnu Amble 32:13
well, believe in cycles and that, okay, traditional energy through cycles. There’s always so when I was starting working, you know, oil prices were plummeting, natural gas was peaking. This is pre fracking, and people just said, energy you want to play this game. Funds were really underperforming, and utilities were just regulated. They were boring. It was a boring industry, right? Totally a boring industry. Now, I mean, energy is the hottest topic, traditional to renewable, to the combination of the energy systems. Very important. Energy will always have its, you know, its space. It doesn’t need to be fusion. You know, you have smarts. You have just different types of energy. And that convergence of tech and energy into the capital to support that is really, I mean, it’s as important as ever. I think it will continue this trajectory on a secular basis and its importance. And it’s not just a hype area of discussion, it’s, it’s a fundamental item of just continued economic growth and

Earnest Sweat 33:19
development. Well, it just seems like everything is the key to I guess, the theme of this episode is convergence, right? And being able to see different domains, just like blur lines with each other, with that. Where do you think over these next 10 years that will be the biggest opportunities for early stage investors. What do you want people to start looking at? What do you think they’re looking at? Too much.

Vishnu Amble 33:50
Yes. So on the early stage themes right now, I think it’s still back to just deep tech science. Where was the.com boom and bus era, microprocessors, biotech, healthcare, et cetera, same thing. So those are themes that we want to play. Yes, there are several other, you know, just continued digitalization use with that, having that science in venture is so important. And then as capital markets also re rate, cost of capital, expectations, re rate. You’ll have that appropriate stack where growth capital comes in, pre IPO capital comes in. I think there’s still a cost of capital inversion, but you will have this re rating of the capital stack, and again, to fund that innovation. But it also goes back to venture. Is, there’s only a few opportunities. There’s a lot of capital out there. Yes, only a few opportunities. I want to back the best people. The markets speak for themselves, and this is what I find. It is a challenge to seeding emerging managers. Is because the selection and the markets, I think, is very efficient. It finds the best these funds raise like. That they don’t need incubation. They don’t need a start. You know, the market finds them. And because our sized outcomes are so concentrated, and there’s only a few managers that can attain those and outperform traditional asset classes or competitive asset classes, you really have to, it just goes back to concentration across the board.

Alexa Binns 35:22
In conclusion, I know you were a student of history. We talk a lot here about our reading lists or what we’re listening to. I’m curious if there’s a particular lesson from history that you think is relevant to the markets today, and maybe, maybe it’s something you picked up from a favorite book, or something that you’ve heard recently on a favorite podcast.

Vishnu Amble 35:47
You know, for me, it’s actually just, if you study United States history, and you know, there have been challenges throughout United States history, right? Significant societal, structural, political challenges, and it remains the place for entrepreneurship, capital markets, development, value creation. You still have this. You know, immigration, for example. I mean Singapore. The reason why it’s just that it’s not turning into Switzerland is that there is no immigration there, right? There isn’t, you can’t be an entrepreneur. How do I go back if I want to go back, a theme around the South Asian entrepreneur. I can’t even hire or keep people in Singapore of South Asian descent, because there’s always some visa or challenge. I want to back them in a place where I can hire them and hire the best talent. And relatively speaking, the United States is still the best. And we’ve seen this, the challenges through cycles, but we see this value creation, right? I mean, we took a view that the after.com boom had burst, that the US had peaked, and so that’s why we invested heavily in emerging markets, particularly in private markets, and that that trade was incorrect. Frankly, we certainly lost money, and the United States continues to innovate itself in different manners, whereas emerging markets really, really struggled. Yes, there is economic development in these countries, but are they suited for fund managers? Fund managers who can outperform relatively, relative to risk, to, you know, just cost of capital, say, US or European markets. So this is, this is something. So I’m in the US. We believe in the US. We believe in the American story and the opportunity, and we’re to continue to back that.