By Philippe Barthelemy, Managing Partner – CO Founder at WeInvest Capital Partners
As featured in LPEA Insight/Out magazine #19, September 2021.
The appetite for investors in alternative and real assets seems to be growing globally in most of the strategies. In addition, the level of liquidity in the market is historically high these days. Furthermore, the demand for fresh equity in most of the segments of the economy is also high, especially in innovating sectors, and even is reinforced by the COVID-19 crisis in the traditional economy segments. In combination with an increasingly favorable regulatory framework, these factors are sustaining the interest in Private Equity / Real Estate vehicles investments.
“Questioning one’s project to raise a first-time fund should be analyzed over several perspectives”
However, despite favorable conditions, the exercise to raise a first-time fund is not as easy as it could be perceived. As a matter of fact, questioning one’s project to raise a first-time fund should be analyzed over several perspectives:
In terms of investment strategy, first. How do you differentiate from the competition? New fund managers should develop an approach of the market that creates an interest to LPs through its originality. This originality can be analyzed in different ways: some can see opportunities in addressing a new market segment in the innovating economy, some can also see opportunities in the more traditional economy, investing in segments that are not addressed by managers. In any case, the investment strategy has to be clear and documented. Your beliefs are also very important. LPs are looking for teams with convictions that are backed by a rational analysis.
I remember the baseline of one of my former companies: “more than numbers, our business is based on trust”. And it’s exactly that. When you are a first-time team / first-time fund, you must inspire confidence to succeed. Both to your investors and also to partners with whom you are investing and doing business.
In 2019, when we started defining our strategy, we built our approach on 2 pillars to generate confidence:
- Confirming our appetite for real estate, an industry in which we were already active. At that time, we were capitalizing on previous successful club deals and private debts in the niche premium segment of real estate development. We knew exactly which investment strategy to implement, with a clear path to creating value in our investments. Real assets are also an excellent start because of the nature of the investment. When you own an asset, the land and buildings provide strong protection for invested capital. It helps to create confidence with investors.
- Progressing gradually in reaching out to investors. First people first. We had strong interest from some of our former investors, clients, mentors, or managers that knew what we were able to achieve in our previous occupations. They helped us a lot in creating the foundations of our first closing.
Today, our first fund, Premium Real Estate Fund, has raised more than 20 million and is still raising capital until mid-2022. We have executed 7 investments in one year, deploying almost 100% of the committed capital in Luxembourg, the United States, Spain and France. The quality and speed of execution were key to make investors trust us, and we had identified all these investments before launching the fund.
2022 will be the year when we will add 2 new strategies to our portfolio:
- A private equity-like investment vehicle, Beautiful Small Cap Fund that will invest directly into a portfolio of (very) small cap companies in Luxembourg, Belgium and France. We believe that small companies will have a strong challenge to face to survive because of the wave of baby boomers who will have to retire in the next few years. And this will generate needs for financing transition to new managers, with also opportunities to build-up new groups by concentrating companies.
- A private debt vehicle investing in real estate as well, to enrich our financing proposition of development projects, capitalizing on Premium Real Estate Fund success.
To sustain our fast growth, we have strengthened our human resources, adding new seasoned professionals to our fellowship. Always lying upon the same values: we are in a people first industry!
About WeInvest Capital Partners
WeInvest Capital Partners is a boutique firm specializing in Private Equity Real Estate (PERE), real estate asset management and Private Equity.
WeInvest Capital Partners seeks to create long-term risk-adjusted value for its investors through a portfolio of reserved alternative investment funds, creating positive impacts to every project it invests in. Led by serial entrepreneurs, bringing together a broad range of expertise, the company benefits from an extensive network and invests mainly in Europe and the United States.
Incorporated in late 2019 in Luxembourg, WeInvest Capital Partners, member of LPEA, is successfully finishing the raising of its first Real Estate fund and is pursuing its development through the forthcoming implementation of a Private Equity vehicle dedicated to very small cap investments.