Leadership insight: how to navigate change with Daniel Pinto
31 Mar 2021
How do you navigate an international merger during a global pandemic? Daniel Pinto, founder of Stanhope Capital, did just that. Here, he tells Mark Pomroy of Investec – which financed the deal – about his motivations, the lessons he’s learned and what the future holds.
“I worked in M&A and Capital Markets and I was very happy to have learned my trade in a good firm, but I felt that there was a space for an entrepreneur in what I wanted to do. A couple of years later I decided to create Stanhope Capital,” Daniel explains.
His vision was to build a wealth management firm with an independent ethos and global expertise – a combination that has proved highly successful.
Stanhope Capital has grown internationally over the past 17 years, while expanding its offering into merchant banking, consultancy private equity and real estate. In November 2020, it announced a merger with FWM Holdings (spanning Forbes Family Trust, LGL Partners and Optima Fund Management), which will see the group operate as a single company with a presence in Europe and the USA.
“Today, we oversee about USD25 billion on behalf of wealthy families and institutions. We have 140 employees and about 40 of those employees are dedicated to investment research across the globe and across asset classes,” says Daniel. “We have a global reach but maintain the transparency and bespoke service of an independent business.”
There is no such thing as cruising, particularly in entrepreneurial businesses. You need to move with the times, reinvent yourself periodically and continuously be pedalling.
Daniel Pinto, founder of Stanhope Capital
Motivations of a business leader
The need to stay relevant keeps things interesting. “There is no such thing as cruising, particularly in entrepreneurial businesses. You need to move with the times, reinvent yourself periodically and continuously be pedalling.”
Managing a transatlantic merger during a pandemic
“When the pandemic took hold, we had to completely recalibrate the way we progressed this merger. The challenge was to keep everything together. Everyone was committed and really made sure that the train was kept on its tracks.”
It was Investec – as sole lender – that provided the capital to buy out the private equity backing of FWM Holdings. The newly formed Stanhope Capital Group then became fully owner-managed with the leaders of both businesses having shares.
The financial climate meant it was even more important that the deal was structured sensitively. “The world of markets is very volatile so you have to make sure that you have enough leeway to handle it. The Investec team was aware of the dynamics of the industry and worked with us to find a way to accommodate that flexibility in the loan package.”
With the paperwork now done, Daniel’s focus is on successfully bringing together two teams: one European-centric, and the other focused on the US.
“I’m not underestimating the challenge of putting together a group of 140 people on two sides of the ocean,” he says. “Of course, that doesn’t mean that we’ll do exactly the same on both sides of the Atlantic, because there are specificities to the US market and specificities of European markets that need to be taken into account.”
The world of markets is very volatile so you have to make sure that you have enough leeway to handle it. The Investec team was aware of the dynamics of the industry and worked with us to find a way to accommodate that flexibility in the loan package.
Daniel Pinto on the financial complexities of a merger and how Investec helped
Looking to the future
There is a growing focus on purpose, including ESG (environmental, social and corporate governance) investing. “A company that is more attuned to the needs of its community is likely to do better than a company that treats them as peripheral to its business. So you don’t need to choose between returns and doing good, you can have both.”
Expansion in Asia?
Any future mergers with other independent businesses would aim to preserve an owner-managed structure. “It’s a recipe that’s very attractive to founders,” says Daniel. “It allows them to pursue their entrepreneurial journey, but as part of a larger platform.”