How private equity stopped being a billionaires' club | Unlocked

00:00:00: How do we find the next open AI?

00:00:02: There are different ways.

00:00:03: Either you try to predict the future and bet on something, that's where typically venture capitalists also take this twenty percent performance fee cut.

00:00:11: it is called carried interest

00:00:12: or

00:00:13: just like an index fund in public markets The NASA one hundred.

00:00:17: not specifically betting which one company is a Next Nvidia.

00:00:20: It's just betting all hundreds of largest companies.

00:00:22: And thats basically our approach Where We say You don't need to predict Which One Is Best Or If Open AI Is Better Than Anthropic.

00:00:29: We don't know, no one knows but we are making all of those available to these investors.

00:00:37: Hi, welcome to Unlocked the podcast presented by SwissQuote giving a voice To those who challenge the rules and reinvent their industries.

00:00:45: He received his first stock at fourteen discovered that investing could be just as creative As art spent part of his youth doing graffiti And eventually built one of Switzerland's leading fintechs in private markets.

00:00:57: Our guest today is Andreas Bezner founder and CEO of Stapleton The company opening the doors of private equity.

00:01:04: too much broader audience.

00:01:06: Andreas Welcome to unlock.

00:01:07: Thank you Igor.

00:01:08: in Swiss quote.

00:01:08: Nice to be here.

00:01:09: You often say that your passion for investing started when your father gave you your first stock at fourteen, right?

00:01:16: Do you still remember what the company was What you felt at that moment and whether you immediately knew this would become more than just a hobby?

00:01:25: I of course did not know what's going to happen And how that influenced my myself or my future career at that point in time.

00:01:33: So I got two stocks as a confirmation gift from my dad when it was, roughly fourteen.

00:01:38: these were local to local companies and one went bankrupt.

00:01:42: the other one threefolded When i got really interested In debt when i joined university.

00:01:46: so i could Really hook like okay how can you make invest?

00:01:49: And then Make money without doing anything?

00:01:52: It's always The dream right To make Money Without Doing Anything.

00:01:54: Well i guess

00:01:55: over A long term Everyone If it's just invested, he can make more typically.

00:02:00: But then also at university I made a lot of friends who drove my curiosity even towards the stock market or in general investing.

00:02:08: Just before we mentioned you were doing graffiti!

00:02:12: Can maybe explain what this passion was?

00:02:15: Investing graffiti did not sound like most obvious combination right?

00:02:20: Yeah i've got some other secrets and talents that are to obvious and don't necessarily match investing.

00:02:29: But graffiti is one of them.

00:02:31: in my young ages, I started graffiti And ultimately i became a professional graffiti artist between the age of twelve when it started at twenty three actually earned around about seventy thousand euros with that doing artwork for companies and cities.

00:02:47: basically putting graffiti murals on walls and sub underpasses

00:02:53: Sounds like Banksy to me.

00:02:55: Are you the Banksy that everybody is talking about?

00:02:57: There are still a lot of graffiti existing, but they're not as protected as Banksy stuff and off course not as as lucrative.

00:03:04: anyways let's talk about Stapleton your company.

00:03:06: before this Company Stapletone was there specific moment job or conversation That made You think there has To be better way to invest in private companies?

00:03:15: As A person I'm really observing And i'm curious About how things work.

00:03:18: so Of Course naturally over time As I collect all these different pieces of information, they are shaping my thinking along the way.

00:03:25: But maybe if i go back to my career... ...I would say there may be four times what I did.

00:03:31: It started when I was generally interested in investing and then in two thousand.

00:03:36: I joined Merrill Lynch as an intern And so I thought that I am joining the world's best investment bank at this time.

00:03:42: What I found is mostly complex products with really high-fee products just for investors' stock market.

00:03:49: followed was the real growth of index funds and ETFs.

00:03:53: That's where I thought there must be a better way, more cheap or low-cost ways.

00:03:58: Secondly they started working for Ernst & Young.

00:04:00: also wrote my master thesis after university about the second year mark for private equity.

00:04:05: then i joined another Swiss private equity firm.

00:04:08: so here Private companies are really amazing companies and you can theoretically make a lot of money, but at the same time it's really exclusive.

00:04:18: I mean no one has access except for institutional

00:04:20: investors.".

00:04:21: And then third was when i founded my hedge fund firm.

00:04:24: we've been working hard in trading and doing deep analysis... ...and ultimately were the ones that created value to our funds But not the company or portfolio because they're so frequent.

00:04:36: So after I sold my Hedge Fund It became clear that I really want to include all those lessons learned, including low cost easy-to-understand simple portfolios.

00:04:48: That are just super easy!

00:04:50: Why complex if it can be done easily?

00:04:52: Secondly private market is an amazing place to be in but you just need get into.

00:04:56: the third one would be... Just participate in large value creation of these great private companies.

00:05:03: You don't have a magician.

00:05:05: We also at Stable.

00:05:06: we do hard work Provided access and actually execute the strategy, but effectively.

00:05:12: The companies they are creating that long-term value And so you just need to be invested in the right segment of the ride companies over long periods Of time and then it will be fine.

00:05:20: We'll talk about Stapleton in detail Just after this question That comes to my mind You talked at.

00:05:26: you were in Merrill Lynch before.

00:05:27: what did you decide?

00:05:28: To build a company instead of staying In this financial world?

00:05:31: I was always an entrepreneurial person.

00:05:34: i mean i can remember as A kid i was picking up bottles and to collect the deposit or returning trolleys at the airport for that quarter.

00:05:43: So I was always entrepreneurial, then all my family members are entrepreneurs.

00:05:47: so like i already kind of likely picked it up through my genes but also from observing...I'm just more a person like okay well you know why not try?

00:05:56: Why don't do if other people can do what they want!

00:05:58: And there were two years after university when We are going to find a hedge fund.

00:06:05: I said, uh, Hedge Fund like yeah well if other people can do it we Can Do It.

00:06:08: and that sounds Yeah That Sounds Right.

00:06:10: Okay Let's Do It.

00:06:11: And So We Built That.

00:06:12: so...and There Was Basically The Professional Entrepreneur Career.

00:06:16: Then After That i Started Stapleton.

00:06:18: That'S Amazing!

00:06:18: It Sounds A Bit Like the American Dream But In Switzerland.

00:06:21: Yeah, Entrepreneurship Is Always The Same.

00:06:22: You Just Have To Have Some Kind Of Idea And Just Push Through.

00:06:26: Today Stapletons Gives Access To Companies Like OpenAI Canva Epic Games Before They Go Public.

00:06:33: To understand why this matters, we first need to understand Why private equity has remained such an exclusive club for so long.

00:06:39: Private

00:06:40: Equity is the equity or these companies that are not yet listed.

00:06:44: So it's a much larger market.

00:06:46: All the private companies I would say like fifty hundred times larger than all publicly listed companies.

00:06:53: But in order to invest in them, you really have to deal with the company specifically.

00:06:57: Like we kind of imagine like all Swiss court customers will immediately directly talk about companies that are not the case or they need to go through some VC funds which makes it again very complicated.

00:07:10: but still private companies can grow their business value outside off public eyes without quarterly reporting and short-term focus.

00:07:20: And there is a mostly founder driven and founders with the great idea.

00:07:24: And so that's why there is a lot of value creation in private markets, it remains unaccessible.

00:07:29: That's about to change.

00:07:30: You often say many exciting companies are created before they ever reach stock market.

00:07:36: Has their real-value creation shifted from public markets?

00:07:40: The company you're mentioning these all venture capital backed companies At one point in time, in their life receive venture capital and there investors require a certain high return.

00:07:53: In order to make these bets on new technologies And the twenty five years ago The only exit pass was that this companies will then go public.

00:08:03: So they would do an IPO raise more money?

00:08:05: And the VCs the venture capitalist could sell their shares.

00:08:09: so now the same thing is still happening.

00:08:11: So companies are venture capital funded but they're taking our thirty-and-a-half years To Go Public.

00:08:15: so really long times.

00:08:17: And the private market in general has developed so much over the past two decades that basically changes how companies look at IPO.

00:08:26: So a company does not need to go public anymore because you've got plenty of capital in the private markets, You can stay private and still raise assets.

00:08:34: And secondly liquidity is now existing through secondaries where existing private company shareholders can sell to other shareholders like Stapleton is buying typically shares from existing shareholders.

00:08:47: And so that will also move the desire for liquidity that forces typically the companies to go public.

00:08:53: So there is now unlimited, you know capital equity and growth potential in private markets.

00:08:58: so... That's why companies go public so

00:09:00: late.".

00:09:00: And Why Is This Changing Now?

00:09:02: So twenty years ago if you wanted to have exposure with companies like OpenAI, Canva had to be I guess San Francisco or some people..Why Is It

00:09:11: Changing?".

00:09:11: That exactly how it used to work still works.

00:09:14: of course You Have Venture Capitalists.

00:09:17: So the logic follows like this, you have to select a venture capitalist that has a thesis.

00:09:22: That says okay I would say in next five or ten years that technology is going to take off.

00:09:27: then they're picking kind of companies potentially fit best into their thesis and the company must be successful.

00:09:33: And ultimately maybe after picking twenty funds we've got five unicorns.

00:09:36: so companies are worth more than one billion dollars.

00:09:40: It's very inefficient.

00:09:41: it complicated really hard for most people that because of data, liquidity... We already know these are the top twenty most valuable private companies and we just want to buy into them.

00:09:56: And so we know what they're looking for but don't have a thesis or have to do these bets?

00:10:02: We know this company exists if you wanna be invested in it.

00:10:04: So we need people who sell us shares or talk with other companies about their future growth at some point today.

00:10:12: How can I find the next open AI.

00:10:14: There are different ways either you try to predict the future and bet on something with that's where typically venture capitalists also take this twenty percent performance fee cut, it is called carried interest or just like an index fund in public markets.

00:10:27: um You know the nasa one hundred not specifically betting which one company is next Nvidia It's just betting all a hundred largest companies.

00:10:34: And thats basically our approach Where we say you don't need to predict Which One Is The Best One Or If Open AI Is Better Than Anthropic.

00:10:41: We don't know, no one knows.

00:10:43: But we are making all of those available to these investors.

00:10:46: And what are the biggest myths or misconceptions that people have about private equity?

00:10:50: First of all it's completely liquid.

00:10:53: so there are very illiquid segments but pre-IPO space in largest private tech companies is rather liquid.

00:11:01: Secondly its expensive and complicated.

00:11:04: So they're now products which you can subscribe weekly and sell on a weekly basis, where you always know what is worth etc.

00:11:13: And then also when people say I heard SpaceX or OpenAI going public so basically it's already.

00:11:19: the return has gone but we are so early in AI kind of all these technologies.

00:11:26: they could still go to tenfold-fifty fold over next five years.

00:11:30: So there's so much more potential today.

00:11:32: And why can we say that private equity matters?

00:11:34: I guess also it is because of beliefs.

00:11:36: you said, sometimes bet just as a reminder nothing from what we says financial advice and check if the products in this podcast are available in your country or description.

00:11:50: If had to explain one sentence Why Private Equity Matters Today More Than Ever What Would You Say?

00:11:55: Well, there are way more private companies than their public ones and specifically within private equity in the venture capital part of the world.

00:12:03: That's where our companies really create new things.

00:12:06: think about Airbnb or SpaceX.

00:12:08: you know like years ago no one would have believed that actually a viable thing.

00:12:13: so all these private companies.

00:12:14: they bet on trends early that can be super transformative and of course many, many fail.

00:12:20: That's called early-stage venture capital.

00:12:22: but then there are so many other companies that make it and they ultimately become the greatest companies of todays times.

00:12:27: I mean like all these companies like Palantir and Meta or whatever.

00:12:31: They're all venture capital like companies And ultimately if you really work on a big thing These can become huge companies also great for society because thats really power innovation that is helping us as whole as a society.

00:12:45: that's what is great about private equity.

00:12:47: it's not longer just about billionaires and institutional investors.

00:12:51: As you say, It Is becoming a window into how the economy itself is changing.

00:12:55: What does the rise of private equity tell us?

00:12:57: About The future Of business?

00:12:58: yeah if You think about as A person in today's life, like what's changing your life?

00:13:02: And it certainly AI right for example or financial technology.

00:13:06: Or unfortunately at the moment defense.

00:13:08: so these are really things that are impacting our lives.

00:13:10: and yet there is no possibility to invest in those pure play companies on this dog exchange.

00:13:15: So that's what private equity you've got so many more direct dimensions of where can allocate money.

00:13:22: secondly a lot traditional company they're going go away because new technologies only few.

00:13:29: It's called the Magnificent Seven, for example.

00:13:31: They are really already large.

00:13:32: but there so many other great companies that still private.

00:13:35: they're taking on to something and creating huge amounts of value over time And as an investor you should also consider those because not only affecting your life But it can make a significant financial impact in our lives too.

00:13:48: Are we moving towards world where most valuable company stay private longer?

00:13:53: Maybe forever?

00:13:54: It could very well be, because as mentioned previously there is no specific reason anymore to go public.

00:14:02: That means companies love to stay private and their founder let these founders have solved like so many problems that they're going continue run those companies basically unlimited growth potential in the markets.

00:14:15: And when they go public, that's maybe actually when the company has already created so much value there... So it is better for everyone to list and then potentially sell.

00:14:23: but I really think that great companies stay private longer or sometimes forever.

00:14:28: It doesn't mean if you are investing this type of company need an exit right?

00:14:32: That isn't necessary.

00:14:33: But i would just say its gets more difficult for public market investors to participate in those megatrends.

00:14:38: Talking about trends You talked about AI and thats a necessary good now.

00:14:42: and that you see private equity going full-on in AI.

00:14:46: What other themes do you see emerging over the five or ten next years, except AI?

00:14:51: because it's kind of obvious for everyone I feel.

00:14:54: but what are their topics?

00:14:55: Yeah specifically on AI.

00:14:57: so how many all of us are actively, seriously using let's say even a paid version or professionally something like Claude.

00:15:05: I mean everyone has maybe used JetGBT but i think only that AI part is already kind of it could hundredfold from here because...I mean its really the beginning.

00:15:14: and secondly everything around would be space technology defense robotics as major thing financial technology payments if you also thinking about other things like commerce healthcare alternative data or datapoints, anything that you could think of.

00:15:33: It has so many new implications and I would say just what exists today?

00:15:36: Any kind of segment that exists today will be available in another better form powered by a better technologies.

00:15:45: So it can be an evolution on the way we see.

00:15:47: now AI still feels like we're at the beginning Like with the two thousands internet.

00:15:52: You feel there's still big boom coming.

00:15:55: Yeah, I mean you think of everything like services today.

00:15:58: Like people do the service.

00:16:00: that's why they're expensive and take long times right?

00:16:02: So AI power services are something or let say real estate.

00:16:06: Why wouldn't you three D printer house entirely or healthcare?

00:16:10: with a utilization of AI in better data You can have personalized medicine there.

00:16:15: so many things that are not available on public markets, then they're kind of definitely booming over the next coming years.

00:16:22: There is also a bit of fear I must say... Also talking about this AI replacing jobs and disrupting industries from an investor's perspective where do you see the biggest opportunities?

00:16:33: Of course people have been divided between if AIs really taking all our jobs or it just like any other thing like electricity or railroads because we humans were creative and flexible and adjustable.

00:16:47: But okay, it could be that may take jobs.

00:16:50: at the same time AI would also significantly reduce the cost of living through AI but as an investor just as I mentioned so we are still so early in transformation is still there.

00:17:02: i think natural hedge if affects you much should invest those things right.

00:17:08: no financial advice what's impacting me?

00:17:12: And line my financial exposure with Looking at these private companies as well.

00:17:17: Thank you for everything he said, I think it's always interesting to talk about entrepreneurship with real entrepreneurs and we've spoken about the markets in companies in the future.

00:17:26: but i want know a bit more about you because behind of this stable company that created is the entrepreneur a creative person.

00:17:37: And I think you have to be creative in this business, right?

00:17:40: Yeah,

00:17:40: iIthinkyouhavetosee things that other people don't see.

00:17:42: yet Also an entrepreneur requires like seeing things That Other People Don't Think.

00:17:46: Then Be Really Stubborn About That and People Have Like Numerously Told.

00:17:49: So Sorry Andrea That Does Not Work ,That's not How It Is Working .

00:17:52: I really believe thats the way it should be working Ultimately.

00:17:55: just also pure execution of course Hard work and doing Things Really Well.

00:17:59: Did You Ever Think That You Would Be Running A Fintech Company ?

00:18:03: No !

00:18:04: Let'S Say really into investing.

00:18:07: And so ultimately, kind of like my passion about the curiosity and passion that's then also centered around something you're building in.

00:18:15: But no, that specific company and goal.

00:18:18: Also the evolution of Stapleton which I co-founded with my partner Konstantin we.

00:18:22: it was also like not exact same pure play model That we had today.

00:18:27: so a lot of you know adjustments off course of strategy over The last in the meantime eight years.

00:18:32: what would that younger version Of You think if he saw your life Today?

00:18:37: The graffiti person.

00:18:38: now

00:18:39: i think We've done A few things right.

00:18:41: I mean, we're at seven hundred fifty million in assets crossing the one billion after summer.

00:18:46: I think this younger me would likely be proud.

00:18:50: At the same time like that young person will say well i didn't know where That Would lead because it was kind of a collection Of points which did not make so much sense Like at that point In Time but going back It made A lot of sense.

00:19:03: But yeah, that's how I would answer this one.

00:19:05: Do you still have the same appetite for risk when you were younger or maybe less?

00:19:10: Or has success changed the way you think?

00:19:13: Yeah,

00:19:14: i think risk is a lot very subjective matter like.

00:19:16: For some people it's risky if they don't know what they're doing and so I think as an entrepreneur You have higher risk taking level but sometimes about risk versus uncertainty And both of you maybe are able to influence or not.

00:19:31: Of course, I wouldn't be doing like ruthless risk... ...I would never have done that when i was young.

00:19:36: Like ruthless risks they would risk my life right?

00:19:39: But yeah at the one point in time.. ..you can make other risks because we've got way more experience today.

00:19:45: At the same time You know and a little bit older I'll take less other risks.

00:19:50: What can we wish for your company?

00:19:53: To close this in positive note Maybe what can I wish for future?

00:19:57: Well,

00:19:57: good luck is certainly helpful.

00:19:59: But then otherwise I think that the strength would continue of... ...that more people are excited about these private technologies or these technologies exist at this private technology companies lead and produce.

00:20:12: I think overall, what's really helpful is a podcast like that.

00:20:17: That people know more about their possibilities and get excited about things they may not know because it isn't common sense or mainstream investing until now.

00:20:26: so thats why i think its helpful for our work and success.

00:20:33: Thank you very much for coming on the podcast and sharing your thoughts.

00:20:36: everyone appreciates when people talk.

00:20:39: They're alive, but also their experience and as you said it's a lot of educational content We are trying to show because education comes first when we talk about finance.

00:20:48: I think this is where Also the risk Is?

00:20:51: Because risk comes.

00:20:52: Also from not knowing You've been listening To unlock The podcast presented by Swiss quote.

00:20:56: if you enjoyed This episode subscribe leave us A comment And anything you want to share with Us.

00:21:01: discover more conversations With founders builders and innovators across our platforms.

00:21:06: Thank you so much and see you next time.

00:21:07: thank you Andreas.

00:21:08: Thank

00:21:08: you so much Igor

00:21:19: and SwissQuote.