The following interview is a discussion between RealPort’s Founder, Ekow Yankah, and our new Advisor to the Board, Eugene Zhuchenko. This piece is a part of our “In Conversation with RealPort” series.
Firstly, we want our reader to know a little about you. Can you please share with us your professional and personal background and career in renewables?
On the professional side, I have been doing infrastructure investments for my entire career. I’ve spent about 22 years in this field and have seen it from various angles. I started in infrastructure in an advisor capacity with PricewaterhouseCoopers, then spent a few years in corporate M&A with APM Terminals, part of the Maersk group, and in portfolio management with APG Asset Management in Amsterdam and New York. Before I founded my own firm, I ran an association of infrastructure investors, called Long Term Infrastructure Investors Association. This gave me the grounding to view and learn about the sector from different angles, interact with various stakeholders, and I remain involved with the industry forums, conferences, and events. This is the background which I bring to help developing RealPort’s proposition.
On a personal note, I like travelling off the beaten path, and look forward to doing that more once the pandemic subsides. I also like readings in military history, playing tennis and swimming!
I’d like to hear from you where you see the largest challenges for investors who are new to the renewables sector and interested in getting into it, and those already familiar with the sector.
Infrastructure continues to evolve and expand as an asset class. The involvement of private capital in financing infrastructure has been steadily growing since the early 2000s, increasing twenty-folds or more, depending on how you count it. Infrastructure has really joined the mainstream of investing alongside other asset classes such as private equity, real estate, hedge fund investing, etc. The success of this growth also means we know who the sector’s front runners are, where the coverage of the market is relatively efficient, and where it can be improved.
Smaller and newer investors that are looking to allocate, say, €2 million, € 20 million or € 50 million are often struggling to get a hold of a deal that is economically attractive, simply because most interesting propositions from fund managers tend to be geared towards investors with larger allocations. For them, RealPort is offering a digital marketplace to effectively access transactions together with other investors at zero coordination cost, no matter how big or small the investment amount is.
On the opposite end of the range, we have super large investors that typically make long-term, illiquid investments in infrastructure. They may still be interested in having certain levels of liquid exposure to the asset class — for example, for managing liquidity pools or for tactical allocation purposes. They would need a solution enabling a purchase of relatively small positions in a quick and hassle-free fashion, and then an exit before maturity, with a similar ease. This might be another use case for the RealPort’s platform, addressing marketplace inefficiencies that exists today.
How should new investors frame their objectives and approach their first trade?
For newcomers, I think it’s important to understand better what the asset class is and what it can deliver in relation to their investment objectives. Portfolio objectives should follow from there — e.g. what sectors, geographies and risk profiles to invest in. Once parameters are clear, investors can start reviewing specific investment offerings. Initial preparations may take time, but after the first trade comes through things tend to get a lot easier and faster.
Where do you think the RealPort platform addresses these topics specially around starting to gain exposure to the sector in a concrete manner?
The most important element of RealPort’s offering is visibility into an asset class. It provides a completely digital experience of finding your asset, learning the parameters of the deal, and closing — you can do all of that without leaving the office. The entire workstream is electronic and investor would have a relatively high certainty of completing a transaction — compared to participating in a competitive market process. Also, an investor would not need to spend time and effort to find advisors for completing due diligence, but rather have all relevant information digitally at its fingertips. Last but not least, I would mention transaction costs that are particularly competitive for investments of smaller scale.
What attracted you to join and contribute towards this project on a personal level?
I’m very passionate about innovation in the infrastructure space. For over twenty years, for me it has been a journey of innovation. The asset class continues to evolve, which means we need to continue identifying and addressing market inefficiencies. Opportunity to bring about more innovation in the infrastructure marketplace is the key reason why I started working with the RealPort team.
What are your hopes to be working with the new Asset Selection Committee, who are all experts? What value do you think you can drive by working together with them? What are some of the projects you’re looking forward to working with them?
I hope to bring the understanding of what the investor needs are, and help ASC evaluate the incoming assets with that perspective in mind.
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