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Seven out of ten families want to focus on private deals…

After a career at banking groups Julius Baer and Credit Suisse, Ali Jamal has chosen to adapt to changing circumstances.

Rather than touting for fees in an unforgiving market, he started Azura in 2019 as a multi-family office, where each partner is directly retained by family offices and individuals worth $250 million or more, to help them achieve scale, sophistication and inter-generational security. The provision of advice on wealth management is part of the package.

He is unusually bullish on Britain, believing its potential has been under-recognised in the wake of Brexit: “I’m long London.” 

“Seven out of ten families want to focus on private deals,” Jamal says. “Principal-to-principal transactions have become more demand-led with less investment bankers in the middle.” 

There’s nothing new in principals, and corporates, wanting to tap into the expertise of investment banks. Warren Buffett, who understands capital markets better than most, often used to rely on Byron Trott of Goldman Sachs.

Jamal’s approach effectively recognises that the banking sector has shrunk over the last ten years, while the size and reach of family offices have grown exponentially. Billionaires regularly contemplate taking commercial companies private. Principals are ready to buy and sell entire companies with little assistance from the stock market. Co-investment has become popular. 

Jamal believes Azura can offer the best service by ensuring its partners restrict their advice to servicing few as three family offices in incredible detail, regularly attending their meetings and sitting alongside senior officers such as heads of investment, technology and operations. He wants to provide advice over the long term.

“Our job would be to add value, not to interfere in the relationship between principal and chief executive. While we are listening and seeing what is going on, we can advise clients what can be done, and what cannot be done.” 

Azura is happy to introduce deals to clients but does not want to force the issue. Family offices themselves often originate deals: “They are always going to be smarter than you, and you can learn from them. It’s good to be transparent and earn their trust because that’s good for your pension.” 

He says principals now have the opportunity to originate deals on a scale not experienced in the banking or private equity sectors. And he wants to make the opportunity real.  

Jamal started his career as a lieutenant in the Kuwaiti army. He moved to BSI Bank, then became a Credit Suisse director. He worked for Julius Baer for five years as head of key emerging markets where he enjoyed working for its former CEO Boris Collardi, renowned for his fast cars and quickfire acquisition strategy. They remain friends. 

Collardi quit Baer in November 2017 to run Swiss wealth adviser Pictet, which he quit on 18 August following a culture clash. Time will tell where he ends up. Azura isn’t saying. 

Jamal went off the banking sector following Collardi’s departure, after weighing up several approaches. The banks were continuing to retrench and Jamal decided that even if he became friendly with senior management at a new bank, they could easily be replaced by someone worse. Bonuses can provide an incentive to executives, but not when a bank hits hard times and its shares get hammered, as Credit Suisse bankers recently discovered to their cost.   

Jamal decided that working directly with sophisticated families and ultra-wealthy individuals would bring durable opportunities. As well as working with family offices to achieve best execution on their deals, Azura has the chance to take on the banks from the other side of the table. 

Every partner is getting equity in the business, and Jamal believes they will have a better chance of growing the pot because Azura is not exposed to as many risks as a bank.

“We manage 15 clients with $2.7 billion. Our clients don’t need to go to a bank or private equity and we can help with the origination process. This is what differentiates Azura from the banks.”

Jamal wants to take his client roster to 50 in less than four years by hiring the right partners: “We need the right people who are emotionally engaged, with the right way of communicating with clients. 

“I’ve never set out structure plans for our business. I don’t want to put people in boxes. I want them to provide the right level of client service the way they want.” 

Jamal admits he is a bit frustrated by the lack of face-to-face time during the pandemic. But he has taken advantage to develop a structure for his business, lease offices and take on senior talent like Frederic Turrettini (Credit Suisse); Robert Agnew (Barclays) and Rahul Ahuja (Aviva). 

A key aspect of Azura’s advice relates to its insights into the banking sector, including where banks might be prepared to find sufficient room on their balance sheets to provide capital.

Access to loans was hard during the pandemic so Azura needed to think laterally.  For example, banks were reluctant to provide loan capital for deals in aviation. But one of Azura’s clients wanted to tackle an acquisition in the sector. Azura ended up tracking down two family offices ready to offer equity finance to seal a merger. Elsewhere, a family office chose to co-invest in a property with one of its peers because it did not want to do business with a bank. 

Sometimes, Jamal says, family offices are keen to provide cash to a SPAC in the hope of putting it to use through a deal. This is a far more interesting option than leaving cash on deposit at interest rates close to zero. And if a deal can’t be struck in two years, families get their money back.

As part of the service, Jamal aims to keep on top of trends. He takes the view that sustainable issues are fast becoming a fiduciary duty for family offices, as well as an investment option. 

Biotech has become a massive area of interest, which requires detailed scrutiny: “You can’t rely on presentations. You need to visit the premises, get to know the people.”  

Elsewhere, Jamal believes debt facilities offered by the banks will become increasingly automated, making them more like utility providers. “In the next three years, investment banking deals are going to come with a matrix. A family office can put a number on the matrix, there will be an online audit and you will get access to the balance sheet.”

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