00:00:00:00 - 00:00:01:09 Unknown okay.

00:00:01:13 - 00:00:24:11 Unknown So welcome back to the Amazing, the weekly podcast for acquisition entrepreneurs, search funders and cocoa builders across the UK, Europe and beyond. We are right now recording live at the Serial Acquirer Symposium, and I'm honored to be joined by Ibrahim Abderrahim, the managing partner at Moonbase Capital, operating out of Barcelona and increasingly one of the most supportive and progressive search investors in Europe.

00:00:24:15 - 00:00:44:09 Unknown Before founding Moonbase Capital, Ibrahim built and led Europe, Egypt, where he managed the largest manufacturer of food ingredients in the Middle East and Africa. And prior to that he was a consultant to McKinsey Milan, subsequently leading the setting up of McKinsey Egyptian Army in Cairo, Ibrahim holds two masters of business from INSEAD and Stanford. Welcome, everyone. Thank you.

00:00:44:13 - 00:01:07:21 Unknown Thank you for having me. Very excited. So I'd like to get started if we can. Even how prolific Mumbai is becoming as a backer of searches and as a supporter of this space, getting into the of what specifically attracted you to this when you had all the options in the world after your last opportunity? Why did you choose search?

00:01:07:27 - 00:01:27:14 Unknown I so I went to Silicon Valley and Stanford's in order to go into visas and technology and all that. And then I had the course in Stanford about funds and, you know, Stanford are very big on search funds. I just fell in love. And because my whole life was an SMU, my family business is in the semi and then we sort of the Germans.

00:01:27:18 - 00:01:45:33 Unknown So this idea of taking a small business and growing it is very close to my heart and experience in this space. So for me, this was like the moment I heard about it was like, I'm doing this Indians in the beginning was so doing as a searcher or as as a captain. So I thought about that. And then the concept was, I already been the CEO for a while.

00:01:45:33 - 00:02:03:09 Unknown I don't want to do this anymore. I prefer to help others to do the story. So I say, okay, so you've so far about how many searchers? 45, I'd say. Incredible. Yeah. And how long a space of time? Four years. Was that so long? It I mean, it's we in this space where they're moving at the pace that it is, that's that's incredible.

00:02:03:09 - 00:02:25:24 Unknown Yeah. And so what have you. Well what's made a good searcher in your opinion and when you're looking for, you know, the kind of opportunities to back because you're not short of opportunities, I would imagine that's actually a very hard question because we we we I mean, we split our searchers into two groups. So we have the operators who are usually very good at running the company.

00:02:25:36 - 00:02:46:18 Unknown But then when it comes to search, it's not they think, however, you have the other group, which is the consultant slash private equity guys who are really good at the search, They're self-motivated. They're they're so it's the content of never operates but when it comes to operations becomes arts and usually these are the two categories we try to put people inside and really we work with both.

00:02:46:25 - 00:03:09:37 Unknown So we look for some things across both like, great, the important like is this person, can you trust them to, to deal with? I mean, trust is one thing, but the other thing is would you because that's a ten year journey, would you be happy to work with them over the next ten years? Do they take feedback? Are they are they excited to do this or are they just doing it because there's no other option?

00:03:09:41 - 00:03:24:26 Unknown So that the only things but I would like to say something which is like we do all these efforts and we think that is a formula, but really that is isn't. So if you look at the people I've backed up and I thought some of them I thought these are the stars, but and not necessarily the ones who get the best companies.

00:03:24:26 - 00:03:49:12 Unknown And the opposite is true. So really, we make such a big thing of who are the right, the searchers. And of course, that is there is a there's a line. But I think above that there is a lot of luck involved and that we have spent like hundreds of millions trying to perfect like this kind of systematic way of assessing founders of early stage businesses I think is equally hard to assess and screen entrepreneurs in the acquisition space.

00:03:49:22 - 00:04:17:02 Unknown I think, you know, there's an element of trusting. You've got there's an element of looking at the provenance of where that comes from. You can kind of understand why some of these accelerates programs like to take people that are proven operators and career changes because that's where the value creation comes from. But similarly, a suitably motivated and competent private equity person who has been flying spreadsheets and doing analytical stuff actually could bring a lot of insightful kind of change to those businesses to create that value to entrepreneurs is hard to screen for, right?

00:04:17:02 - 00:04:36:14 Unknown So now have you invested largely on the quality of the proposition or the quality of the company, or how well you've personally resonated with the surgeon? And I think it's a mix of both of the three things. So for sure, we we we tried to be as close as possible to the searchers. So after two years of working together, we know them quite well.

00:04:36:18 - 00:04:59:24 Unknown So when when the company is is when when they find the company, we can really decide if this searcher fits this company or not. So for sure, the search is an important parts company, of course, is the major, major thing for us, because if you have something like a large I mean, the the margin is big and is growing fast or, you know, okay, you have something that that is is probably a good one.

00:04:59:28 - 00:05:20:04 Unknown And then you have the typical search fund criteria, which we care about. So we're no company has all of them. But in general, I would say the company for us is more of the company of the sector. Of course, the segment reports because if the company's only buoyant but if the sector is growing, you know that that exit at least, you know, a company in a growing sector is still going to make a decent return at least you know in.

00:05:20:04 - 00:05:42:14 Unknown So yeah. So have you are you agnostic about the types of searcher that you invest in? Are you doing equity cap deals in self-funded as well as traditional? So we have done equity gaps in or were open to equity gaps. However, self-funded for us was a bit hard because which was mentioned within the event, which is very true for us.

00:05:42:18 - 00:06:01:13 Unknown The traditional search funds entrepreneur, when they find the deal, it's very easy to know the structure, you know everything and you just go ahead. Self-funded is a lot of work. You need to know who else is investing. There's always percentages. There's a negotiation with the search on how much they would take. So there's all of that. So it it does take way more work.

00:06:01:22 - 00:06:21:46 Unknown And in the ones that least I saw were much smaller smaller, homogeneous consequence of yeah, this the self-funded seems to to kind of gravitate towards the school of deals more equity in smaller deals because raising the capital can be more difficult for those kind of operations. That said, we want to enter more into self-funded and even a single sponsor.

00:06:22:00 - 00:06:56:41 Unknown The fact that these models are all growing and that is very exciting. So we also represent some for wider portfolio diversification, right? Yeah. So not entirely dependent on traditional. Then if that opens up, you know, a wider set of metrics and opportunities to, to balance the portfolio, construct the portfolio 100%. So of course it comes with challenges like you need to be more of an operations, you need to be in M&A machine basically, which is not the typical private equity role or M&A or it's more of you will get especially asset funded you'd have every week deals coming in.

00:06:56:41 - 00:07:12:05 Unknown So you need to be really, you know, more of a a production line of of of of deal yet still not commodify them or tie them all with the same brush. You need to treat them all under that same kind of fresh pair of eyes every time. So this would be the challenge I think is obvious. I think it is.

00:07:12:05 - 00:07:27:38 Unknown And I wonder if I is going to kind of commodify some of that to some extent. Let it do the first screen and tell me if it's meeting any of the kind of metrics that I'm looking for. We're doing that now with searches, actually. So the when we get the PBM, which we have, but that gives us an opinion.

00:07:27:38 - 00:08:02:41 Unknown Of course, we still do the calls and everything, but we're trying to use this interesting and what is it looking for? It's looking for like a set of criteria having to do with the first the MBA, Which MBA? No MBA. The job like the progression jobs. Did they lead people or not? So it's usually things the chief executive PBM, but focused a lot on the city itself last page and comes up with with that with a scoring that honestly usually is not working well so it's we need to an easy sell is going to the human is the human to to make sure but yeah it's a first it's a good start I say to

00:08:02:41 - 00:08:23:05 Unknown I think augmenting the humans with the machines to help us kind of do the heavy lifting is trying to get particularly as the volume of this kind of inbound is inevitably going to grow. I think, you know, having some help there is is critical. And this this I think, will be a challenge for funds because the work that was was needed to be done as a private equity or a venture capital would be very different.

00:08:23:14 - 00:08:49:44 Unknown Then the funds will deal with hundreds of self-funded hundreds of tuition. I mean, like you need to be a very different beast and I think this will be a challenge. I don't know how funds are scale over time. Is there are you a multi kind of fund approach? I mean, basically is is like fund one that's done 45 deals and my you know, maybe 60% of those might become transactions and then capital going into those and we're going to kind of cut it and go from two.

00:08:50:01 - 00:09:11:12 Unknown Or are you perpetual for a degree? No, we are actually more than anyone in that regard. So we the first fund was €15 million and we like the size because we work with around 35 structures in the funds. So we thought that's a good amount to give them the service we think we need to give them. And then now we're doing fund to again 15 million.

00:09:11:16 - 00:09:29:03 Unknown So we're trying to do that. So 35, so 35 and one and now maybe like ten, 15 the other. So we're growing it in Nice. So they've been any returns to fund one so far? It is still too early to say for years, right? Yeah, exactly. I mean the first searcher was 21, 2021 first. The first company was 23.

00:09:29:07 - 00:09:45:48 Unknown So no, not it's I think they're doing okay. They're doing well. It's very hard also in the first year to launch and things like that, you know, multiple investor capital was a kind of creative instrument and a little bit approximate because it's only real when it's real. Exactly. This is very hard to it. The heart to heart, too hard to judge.

00:09:45:48 - 00:10:03:09 Unknown It's especially the SMEs because the business was small in the future, comes in and hires one person and there's one small mistake already. So it's very hard to decide in year one, year two, if there's going to be a winner of the moment that they always have a dry curve. We expect them a year that you acquired and there's going to be change.

00:10:03:18 - 00:10:34:47 Unknown You know, it's all going to continue up until the right. If it does, great. But it's it's they'll guarantee you that for as long as they are the obvious the opposite is true as it business and so do you have a fixed kind of like I on it on an exit window for your the companies that you back are you sort of saying to entrepreneurs look the be mindful this is a five year and at that point we want recapping or we want you to pursue an exit because but hard for these folks to find an exit opportunity in order to deliver distribution as it didn't have a dividends or advocate distributions to your picks.

00:10:35:07 - 00:10:57:10 Unknown No I mean I mean first thing they have to pay the debts. So of course I'll say to you, that's number one. If that is after that, no money and that is extra cash, then I guess dividends would be next. We don't push for an exit because already their return has to do that. A personal return is linked to the IRR so they don't have the incentive to stay.

00:10:57:14 - 00:11:22:06 Unknown No. And if they stay too long, that will probably. So for my for us, our rule is we don't want to push them to sell early because I think that's that's wrong. And we tell our LPs that in the portfolio might have one or two companies that will stay longer than 17 years, so be patient. So we try to be patient as much as possible in Latin America because we think there is other value that you can destroy if you push these guys to sell prematurely.

00:11:22:07 - 00:11:41:05 Unknown Yeah, of course. So of the 35 is fund one, how many have actually gone and found the deal and you've had to participate in the acquisition gives us so far 20 having let's say finished we've participated with half of those in general we do. Our average has been 50% of the deal. Some don't find. So actually only two in fines.

00:11:41:05 - 00:12:00:24 Unknown So for us let's so you pick well yeah you have the optionality on which ones you wanted to back at the at the correct decision capital the executive so far we've done around ten deals from 20 companies. So why, why did those 50% make it in the other 50% did in terms of like when you had to pick out of 20 to do ten, is it going to just be the first ten through the door?

00:12:00:26 - 00:12:21:36 Unknown Is it? No, no. How did you rule out certain ones? Was it just not a sector you wanted to be in each look, the the the other challenge in investing in such funds is the is so diverse. I mean, that is slightly different reasons and so different sectors. And so each one has the reason. So one for example, if it's high in working capital requirement, we don't like got to lecture as we rather spend it.

00:12:21:37 - 00:12:41:31 Unknown So like I said, like for us is, is, is not a red flag with a yellow flag it needs to be a number two is one of them was in a sector that we were not sure it would grow. It was plastic related, etc. and we didn't want that. Yeah, the ESG kind of angle to that. Yeah, plastics is going to get that persona non grata or somewhat annoying, rather addicted to it.

00:12:41:31 - 00:12:59:29 Unknown And I think the thing is you you buy now and the company will exit in five years. So you want to know that someone in five years is going want to buy yet has it's like a hurry too. So this is another reason. Another one was because the the discussions with the searcher made us worry because there was certain things.

00:12:59:29 - 00:13:16:04 Unknown We gave feedback and he was like, I want to close. He wants to close. I mean, and that's also where I think the model breaks a bit because there is a point when the searcher wants to close and he doesn't need to care too much about the future. He wants to close. And this is here where you need to make sure that you look at the right things and ask that question.

00:13:16:04 - 00:13:42:19 Unknown So short termism isn't you don't really want to be wedded to that. Someone with a longer kind of strategy would be beneficial there, I think. But yeah, empathy, I guess tenacity and a bias for action is good, but impetuous ness is not. So the other thing is you really you re aligned during the first two years, but ones that as a company they want to close and you as an investor want to close, but also you're not in the same situation.

00:13:42:19 - 00:14:09:15 Unknown Yeah. So, so here's where it's a bit and it's dangerous because also they deal with the due diligence they they do the the the the negotiations. So in some cases you worry because you get right to review. Of course you review, but you need to we need to do it with with a lot of street smartness because because you know you are one layer backed up from your action, a memo memo.

00:14:09:15 - 00:14:23:18 Unknown You talk to the searcher and you talk to the searcher you but within the day you don't do the negotiation yourself. So there might be something there that was said that, you know, it might be, there might be. So that's makes it a bit harder to close. Yeah. Okay. So you have to have real trust in the searcher.

00:14:23:29 - 00:14:46:42 Unknown Real two points that I made earlier about, you know, good searchers communicating with their investors and being transparent and open book. I think that's there's a great qualities and certainly things that I imagine you guys are looking for. Good. Okay, So let's step out from the deals and look more at the space. You're talking shortly with the keynote that you're giving at the end of the conference today about the future of ETA in Europe, which is which is great.

00:14:46:42 - 00:15:08:29 Unknown We're looking forward to that. I mean, based have become a very much a kind of, a face of ETA in Europe and by which I mean you'll face that these very but I mean the brand, the amount of knowledge that you guys give, the amount of collateral and material that you're putting out to raise the awareness and to improve kind of like standards, if you will, in the space is just phenomenal.

00:15:08:29 - 00:15:33:12 Unknown So first and foremost, things, you know what you saw for what you do for the space. But you know, was that conscious effort and why that what why have you chosen to do that? It's actually interesting because the reason was it came from more fear rather than. So when we started the idea was we have something to offer which which is which is we care a lot about it.

00:15:33:12 - 00:15:49:46 Unknown We want to give a certain service to the searchers and we thought we need this voice to come out, which we didn't realize at the moment is that nobody else used to do that. This five years ago it was very so we started the business goals. No one was really then of proliferating information services, didn't take on that kind of obligation, if you will.

00:15:49:46 - 00:16:16:10 Unknown So we started doing it in order to get known, but also because we thought that such as needs the info and then now it has really a life on its own. So there's a team, there are people to do it, you know. I mean, like now honestly, it's becoming a bit too much. Some people say, so maybe you need to put it back a bit, but it's a lot of work and, and yeah, I mean, what I want to do next is try to pick pick more of the brains of other investors.

00:16:16:10 - 00:16:34:45 Unknown There's so many investors in this space who are so knowledgeable way more than I am. And, and, and we do it on our own. But next step for us would really be try to collaborate collaborate more with investors who would would would would add to the heavy lifting because you create the platform you know you created this kind of awareness.

00:16:34:45 - 00:16:54:29 Unknown You've got so regular cadence of content coming out. So many people the like the bedroom. So investors know because some people don't want the space to grow too fast and they feel that new investors and new ideas are not so welcome. And so that's what I'm saying. Like like we you know, we do something with a lot of love and then some people are like, we all love this too much.

00:16:54:29 - 00:17:15:24 Unknown And so so now I'm in this space or I'm reconsidering whether I should push more of that with us for changing the bit. But it's not as some people don't like the the hype around this word. It's been interesting seeing some of that resistance whereby almost there's been a bit of parochialism it well, this has been our space and it's been quite okay being at this size.

00:17:15:24 - 00:17:41:21 Unknown And you know, we do this number of deals and we allocate this amount of capital and we can happily have it sits at this subsisting level, which I mean, yes, to be respected, but with all this abundant opportunity of, you know, the generational wealth transfer and all of these assemblies which have a compelling reason to sell, if we don't industrialize it a bit more, if we don't encourage more searchers to come in and pick up the mantle, well, we're failing the space.

00:17:41:22 - 00:17:58:21 Unknown Show me. I agree. I agree on 2% of the problem is some people view the RR average RR as a very important metric. And of course, the more you grow, average RR will go down a bit. You as an investor should make sure that your IRR is safe, but so people worry about that. But is there an inevitability to that?

00:17:58:30 - 00:18:16:19 Unknown And I don't know. I think, yeah, I mean, eventually when this thing grows, I really believe we will have in ten, 15 years, you know, thousands searchers a year coming in the space and not like the 50 you have now that I mean that that spread around enough across Europe, for example, or if I say the globe, that's not saturation.

00:18:16:24 - 00:18:33:35 Unknown Not not saturation, not at all. But maybe these searchers will have to start doing maybe there will be some searchers who will do 10 hours. Maybe there are other searchers who will buy or, you know, I mean, like not me any more myself categorize there must and of course, some of the thousands will not be the good searchers.

00:18:33:35 - 00:18:51:38 Unknown So naturally, the the you know, now it's a bit of the cherry, you know, I mean, like you're just picking the best. Of course, this will change. However, you will have a sector because what you have now is you have a niche of any just like and it's nothing. It's really small. So it's I'm very much pro growing.

00:18:51:38 - 00:19:21:08 Unknown It's and I'm very excited by that and and yeah not everyone is on that boat. Yeah. Protecting the metrics like not wanting to see a increasing quantity translating to a reduced percentage of, you know, deal completions or successful searches or whatever like that. That is I understand that. But I think it's a necessary part. You know, what it does is it creates the obligation on the kind of capital allocators to go raise more money, you know, bring more money to the table and for more people to enter the space.

00:19:21:08 - 00:19:40:45 Unknown And you know, that that will naturally kind of catalyze more deals to be done and providing we're all still diligent about the deals that get done. And we're not also overpaying for city multiples for the for the companies, then it should be okay. I don't think we're at risk of saturation any time. And the other thing is you as an investor will choose your deals in your search.

00:19:41:05 - 00:20:04:37 Unknown So your IRR would be your arrow. And if you're a good investor, you can get the best deals anyway. So there's no there's no competition in our world. And that's also I mean, in general, the relationship between the investors is really good. So that is known as excellent. So that's, that's something which we are still holding. But I think the more growth we will see and we will see growth, the hopefully this will not this is a greater it.

00:20:04:40 - 00:20:26:23 Unknown Yeah. So you're bullish on ETA for Europe over the next decade. Then you you see it growing and continuing because we're lagging behind the Americans if you'd like look look through the lens of America. But the market today, okay, it's got different stimulus and different catalysts, but ultimately, you know, the multiples have gone up then, but they've got a lot of lots of deals being done.

00:20:26:23 - 00:20:49:37 Unknown And we are on a similar trajectory here. Or is it going to take a slightly sort of different curve? I mean, we're growing fat now the last three years. We're growing faster than the Americans are. So and that's regard to what got you up. Of course, the base is still quite small, but I think we're catching up. I'm very optimistic about it's a outside American, generally, American generally, but then it deals outside of Europe.

00:20:49:45 - 00:21:10:24 Unknown Yeah, we've done we have I mean, we have deals now, but such as. Yes, such as it searches. Yes, it is not yet where and based on for example with like No but our our no embittered the pioneers in that regards, we don't do necessarily new countries. We do, for example, Brazil. But one of the first that we do, we are within Japan.

00:21:10:24 - 00:21:36:33 Unknown But again, the first year, I mean, so we go outside in Eastern Europe, but even Poland we did to these challenges to to to actually even search is it's really good there the so exactly so we are we are pushing out sides but we are still in the countries which already have been proven already are doing well for example Germany we came late to Germany that's very now is really good and we have three companies in Germany So but we're not for sure.

00:21:36:33 - 00:22:00:26 Unknown Like I'm with the foreigners. God bless these guys. They are definitely forerunners in their risk appetite and their investors. Risk appetite is recommendable actually 100%, but they doing great. Yeah. Yeah. So are you seeing any particular trends emerging in this space? Are you seeing, you know, one model willing out over another? Are you seeing any overall evolution of those trends kind of like deal terms or a lot of.

00:22:00:26 - 00:22:30:09 Unknown Yeah, yeah, yeah. I mean, is this a bunch of trends? I mean, for starters, the demographics of the Searchers is, is becoming much more diverse. So you got. Yeah exactly. So it's becoming it's becoming there's a MBA versus no MBA in terms of backgrounds and there's I thought I meant like the way over indexing on males so males is luckily now we have last study was saying 7% female and you might say that's too small.

00:22:30:11 - 00:22:50:29 Unknown However we're coming from to move and get money in in VC land and will come I mean look at events like today. The event has a good portion of female searches. This is very rare. Like four years ago you would not have one female search. In these events. We come up from 2 to 3%. Eight years ago it was 2 to 3% female to grow from 2 to 3.

00:22:50:29 - 00:23:20:19 Unknown In such a growing markets to seven and eight, this means that females are really, really, you know, coming in. So so I think that's one trend which will see more of another trend is the deals are becoming bigger. So you see a bit of our size and a bit more of a bit of also different. These searches not in order to book and you have what is what is what is really out of things.

00:23:20:23 - 00:23:49:12 Unknown So you've got deal size. We've got demographics changing. We've got any particular countries emerging at pace versus others that I mean yeah, I mentioned earlier RevPAR. I mean this is down there is now a huge focus of attention from acquirers and that's actually very interesting. I think the countries have a few phases. So the start of people are very excited for, let's say, Germany and then you can go to France, Germany, it started early and people are excited and things happen there.

00:23:49:12 - 00:24:13:15 Unknown And then there was a long time where searches so such as put in the searches are not able to close this for for for a time and this scared investors away these days they're closing these and I think it's because you there is a point when you crack the code I think in Germany this realizes that you need people who are a bit more senior with a bit more experience.

00:24:13:19 - 00:24:32:19 Unknown Engineers would be great and that because the founders there would not sell the company to anyone. No they're more more selective. There's a lot of pride in in the German middle stand, you know they want to make sure that the is go to a good home. You we talk a lot about the kind of concern about the legacy and and actually that plays out in I don't want just an investment buyer to buy my business.

00:24:32:19 - 00:24:52:24 Unknown I want somebody that I can trust understands what business and obviously I see that a lot in Germany and then also Germany accelerators helped it a lot. So there's like two or three escalators doing a big job. So that's one. Markets look at France. When our first French investment was in maybe the such number four or five. So it's very early on.

00:24:52:28 - 00:25:14:48 Unknown This was just four years ago. This year there's maybe 15 searches, which is I don't know how many were raised, but they're trying to raise. So they see that being galvanized by the new, non-recourse or the loan structure that is coming for free for SNB succession. I mean, that it's not the SBA equivalent, but it's France's version and it looks like it's specifically aimed at this.

00:25:15:02 - 00:25:34:24 Unknown This problem would let's have some public funding to help businesses transition to a new generation of ownership. I think it's pushing, especially in the in the self-funded in France, I think self-funded funds already have been growing and will grow more. But I think for traditional, it was already on this trajectory and it was expected even without this this loan.

00:25:34:24 - 00:25:55:22 Unknown So yeah, the loan will help, but I think it is France's already. But however now people are not sure exactly if France is as exciting as they thought it was a few years ago. I still think it is, but we still need to figure out how to close deals and good deals. And you see that the pipeline in France is not as healthy as, for example, the pipeline in Spain.

00:25:55:34 - 00:26:13:33 Unknown Spain just figured out it's working really well. So although Spain is is a smaller country than France and with much more searches, but you find really good deals, many people are closing deals. So, you know, I mean, so there is there is a more established in Spain, though. Right. And it's it's it's taught and but but in France, you know.

00:26:13:34 - 00:26:32:10 Unknown Okay. And she has been teaching opera aged but it has already permeated the sort of jingles like ghost of the note. But that's interesting because usually people thought that the more searches you would have, the less likely it is to find a company. But what you're saying now, and I agree, is that actually markets like Spain and the UK, whichever is weren't you and I started people are like, stay away of the UK.

00:26:32:16 - 00:26:57:41 Unknown There's no need in the beginning for traditional. There is more of that. There's not too many investors stay away of it. Now I've seen really good deals of the UK, UK flying and UK is a great place to miss. Yeah, and I think Spain is the avatar for us is the model that we should follow because, you know, it's permeated the business schools, it's permeated the family offices, it's become institutionally mature and it's cultivated a huge vintage of new searches and the deals are being done and you know, some returns are being seen.

00:26:57:41 - 00:27:13:18 Unknown So for us, like looking at it as you know, well, hang on, the US innovated it, the UK should have been next. You know Anglo kind of you know right to it but not no we were asleep this is the Spanish market was like took it and brought it to Europe and was like this is how it should be done.

00:27:13:18 - 00:27:40:33 Unknown Okay. Simon Webster aside. But like you guys are really industrializing. Yeah we could learn a lesson spent. Spain was very lucky with a bunch of investors who started early. The market worked to me was really good at getting these guys in and they're still doing great job. So we were Spain is very lucky for these investors and of course, having AC and Stanford in Asia, having like Spain, the Great UK, if you look at the self-funded part, is doing way better than Spain.

00:27:40:33 - 00:28:00:41 Unknown Yeah, so Spain for traditional search funds, the funding availability problem, it's a willingness to back traditional. And this brings us back to the thing that each market has so difference. I mean, I mean I mean you have, for example, one thing I for me is amazing that it's easier to leverage in Spain than in the UK. It was for me, really.

00:28:01:01 - 00:28:26:23 Unknown I mean, it's we get scalped here on the cost of capital. It's yeah. So unfortunately your regulators do a better job than asset but that's another story for another day. But yeah of getting hold of getting access to since the GFC is getting access to commercial finance at a competitive rate is problematic here and I mean here you do 5050 in Spain we see 60, we see I mean we did the we did one in Germany with 80%.

00:28:26:28 - 00:28:41:13 Unknown I mean, so so I always thought that London is the finance hub, but apparently not for some reason it was really bullish and since the GFC it's become scared of his own shadow or has learned how to use that for its own advantage, you know, as all compliance compliance. So we have to charge you 12 and a half percent.

00:28:41:13 - 00:29:05:32 Unknown So what anyway is going to get me on my own, specify that so it's read forward as maybe look three years down the line. What do you hope Mumbai looks like and what do you hope the results are saying at that point? One thing which is on my mind these days where Mumbai should move, is really not be strictly traditional search funds and go more towards other models.

00:29:05:32 - 00:29:26:47 Unknown So, for example, self-funded is something where I want to look into more and I want to have a unit that works. So that's one other thing is as a single sponsor, I think single sponsor can be very interesting for investors like us because yeah, you do, you do. And it's a different type of job, but also it helps you deploy more.

00:29:26:47 - 00:29:48:40 Unknown And it also covers one problem of, of, of, of such funds, which is that there's no owner, there's a lot of small investors which is, which is working and it will continue working. But but maybe if you have one owner the same way the private equity would have, maybe then in this case it would it would you would see different, more messy that say more aggressive movements.

00:29:48:40 - 00:30:11:15 Unknown And then Italy I think there'll be more good fire is faster strategic input is how I mean it's working really well now but also that's another thing with a trend of growth that I'm worried about because already today having the right board is a challenge. I do worry that the funds that are participating or spreading themselves so from a board representation perspective like that's a challenge.

00:30:11:15 - 00:30:31:33 Unknown I completely agree with you. I mean, it must be difficult with 45 well, let's say 20, you know, some deals and you may want to take a board, observer or board director position all of them. How the hell did you get round? No. And boards are a lot of work is a lot of work Like I, I didn't expect that is a lot of work especially the companies don't do well If it's doing well it's fine.

00:30:31:33 - 00:30:50:10 Unknown But if it's not doing well it's really hard. And I agree with you and it's not paid because the other end is if if, if there are some fund strategy mandatory. But it's like I mean, in in Spain, the fee is around €10,000 a year, which if, you know, if you compare with other funds, I mean, people like us, we don't care about that that much.

00:30:50:10 - 00:31:09:11 Unknown So we still do it because we're not doing it for the money. But still, if this was better paid, you would be able to get people to give it more time. And you can also ask them to be able to do more. Also afford to recruit real specialists to go and do that. Investment management pace resources, which is what we see as well, is, you know, you've got your investor relations and you I see you know as well stuff coach deal that's very predictable.

00:31:09:12 - 00:31:36:47 Unknown But then you've got your investment management are there, you know checking the metrics on the companies attending the board meetings if formulating the strategy. And so I think we could do well to mature a bit more in that area has not acted right. One nugget that you'd like for an aspiring acquisition entrepreneur to take away either about the space and where you see it going or about Mumbai specifically, and how I know I mean, I do want to focus on Mumbai's.

00:31:37:01 - 00:32:00:45 Unknown I, I think the thing that many don't forget, I'd say is the entrepreneurship piece in this journey, because entrepreneurship by the job that is the job and and it's challenging because that is the ups and downs, that is the fact that you need to be very open to other things. And then the fact that you cannot assume which sector is doing that unless you're an expert somewhere.

00:32:00:45 - 00:32:17:24 Unknown But in general you need to be very open. And this let me be very open and very entrepreneurial in my approach and try different things and see this works. It doesn't work around you. And I think I would I would recommend people to such as to do more of that because it's very easy to get into the train and things.

00:32:17:25 - 00:32:34:32 Unknown Okay, I'm going to do exactly like everyone else, but it doesn't work well, I think as the investors can get more picky about the they can have a more of abundant choice of searches to back the searches that are proven operators, the searches that are, you know, able to demonstrate the entrepreneurial ability to add value and create value in the businesses acquire.

00:32:34:36 - 00:32:53:30 Unknown They're the ones to whom the money will gravitate. So I think that's a very wise words like Ibrahim, a mindful that you have to prepare for your keynote, the economy giving us. And I'm really, really appreciative of the time you given up for this interview today. But if there's any call to action you'd like for listeners, maybe in terms of how to reach you or what you'd like to receive from them or not?

00:32:53:34 - 00:33:19:10 Unknown No, I mean, LinkedIn is is is a great way to to connect. We are always very, as you know, very, very active baby to active on LinkedIn. So so that's it. And no, I mean, I think this is a great space and I really believe in the next ten years this thing will be a huge asset. So everyone who's who's in it these days should be very proud because we're building together something which is great and we would have our differences.

00:33:19:10 - 00:33:38:23 Unknown We'll have our different ways of doing it. But at the end of the day, this beast will hopefully challenge the Vichy that you see where it's more of a social impact to it. But I think, you know, the societal impact 100%, 100% did things at a good an exciting time in the emerging nascent space. And it's much needed in the countries we're talking about is much needed.

00:33:38:23 - 00:33:58:21 Unknown So let's see how it goes. Well done, Abraham. Thank you so much. Thank you very much. My pleasure. Thank you. All right. Bye for now. And to our listeners, I hope you enjoyed that great interview with Ibrahim Abdul Rahim Moonbase Capital, a very much worth checking out if you haven't already. Go to Moonbase Capital dot com. We'll have another interview along for you in our next episode.

00:33:58:21 - 00:34:01:18 Unknown But until then, keep on crunching. But for now,