By Korosh Farazad, Co-Ceo, Farazad Investments.
- Pleasure to have you here. Please tell us about your presence being a global Boutique Investment House.
Thank you for having me. Farazad Investments is a subsidiary of Farazad Group, and it compliments rather than competing with the other subsidiaries of the group of companies. Mostly, 80% of the business model specialises in the Real Estate Capital Markets with a strong emphasis on the hospitality investments. We focus on an A-Z structure, where we assist our clients with all elements of the capital stack (combination of different types of financing constitutes a mix of debt and equity instruments, each with varying levels of risk and return.), identifying hotel operators whether they are franchise operators or Hotel Management Agreements (HMA), different F&B concepts to compliment the region, theme of the operator, providing ideas and concepts for other revenue streams for the asset and not simply focused on the revenues from the room and occupancy rates. Having the ability to operate worldwide, it allows us to cater to clients in different countries and regions. We provide a personalized and tailored services to meet the unique needs of our clients in the real estate and hospitality sectors alongside other sectors that are not strictly hospitality driven (multi-residential, industrial, student-housing, etc.). We have a developed expertise and deep knowledge in these areas, allowing it to offer specialized advice, strategies, and solutions. Everything is done in-house, from the initial assessment to deal structuring and execution, which allows us to take full responsibility for the work we do and always have a direct dialogue with our clients and investment partners.
The other 20% of our business model is Corporate Finance, M&A’s, and introducing qualified companies with a healthy EBIDTA and business plan, to become a public company (IPO) within their jurisdiction.
We have a very talented team of people working for the company in Hong Kong, Seoul, and London, which allows us to have a wide reach of different equity investors, lenders at our fingertips to introduce potential opportunities subject to pre-underwriting the deal to understand the validity of the transaction and its success ratio. We currently have two companies that are going IPO in S. Korea and the other in Melbourne, Australia. The Korean opportunity is absolutely going to revolutionise hearing aid and I think by the time this interview published, the company will be officially a public company.
- As of date, Farazad Investments continues its global business expansion. What are the upcoming strategies?
Let me start by saying, I never thought that the company would be in the position that it is today with roughly US$ 1 Billion in deal flow and mandates in its books, and more importantly, the expansion of the other subsidiaries, which are Farazad Advisory, Farazad Ventures, Farazad Facility Services and HYDE Recruitment (outsourcing temporary workers to Hotels across UK to fill in the labour gap post BREXIT).
Sector Diversification: To focus on diversifying client base across various sectors. By expanding the expertise beyond a single industry, this way, we can can reduce risk and capture opportunities in different market segments.
Geographical Expansion: We are aggressively considering expanding presence into new geographical regions or markets. This would constitute establishing offices or partnerships in key global financial centres to attract a wider range of clients and access different sources of capital.
Enhanced Deal Sourcing: We have planned and now in action to develop robust deal sourcing capabilities to identify attractive investment opportunities. This may involve leveraging technology, data analytics, and networks to discover untapped markets and high-potential projects.
Specialized Advisory Services: This goes back to the subsidiary companies complimenting and not competing, our specialized advisory services that provide unique insights and value-add to clients. This includes in-depth sector expertise, customized financial solutions, and strategic guidance throughout the investment lifecycle.
Innovation and Technology: Embracing technological advancements and innovation can significantly enhance efficiency and client experience. We have monitored this sector and have considered investing in advanced data analytics, artificial intelligence, and automation tools to streamline processes, improve decision-making, and provide real-time insights to clients.
Sustainable and Impact Investing: There is a growing trend towards sustainable and impact investing. With 90% of our transaction, we have incorporated environmental, social, and governance (ESG) into our client’s investment strategy, only if one was not implemented prior to them introducing the transaction to us. Further, we offer clients opportunities to align their investments with their values with ESG would is an imminent win for all parties.
Capital Markets Expertise: Given the mandate to raise both equity and debt financing, this requires for us to always be tuned and up to date on market trends, maintaining relationships with investors and lenders, and offering innovative financing structures tailored to clients’ needs.
Client Relationship Management: One of the core and fundamental focuses for us is building strong, long-term relationships with clients. By providing exceptional client service, maintaining open lines of communication, and understanding their clients’ evolving needs, they can foster loyalty and attract new business.
- As a CEO of a boutique investment house, what are the leadership and management skills you have implemented to have the team benefit from?
Clear communication: One of the most essential skills for any leader is the ability to communicate effectively with the team. Despite the challenges this may have, I have developed a clear communication plan and ensure that everyone is aware of their roles and responsibilities.
Empathy: Being an empathetic leader means understanding and acknowledging the team’s perspectives and needs while leading them towards achieving company goals. Encourage and motivating the team to speak up, listen actively to their concerns, provide solutions, and foster a safe and respectful work culture.
Focus on Goals: Focus on setting clear and measurable goals for my team so that they can strive to achieve them. These goals can further motivate them and allow them to showcase their individual strengths and work collaboratively to achieve the shared goals.
Lead by example: Leading by example is a crucial aspect of a good leader. It means that I must always demonstrate the qualities that I want my team to embrace. Show initiative, be proactive, prompt, organized, and disciplined.
Continuously learn and develop: As a leader, it is super important to continuously teach/guide and develop their skills to become better. Encourage them to learn and grow by providing ongoing training and development opportunities to enhance their skills and knowledge where and if needed.
- Do you have a hobby outside of work that helps you be a better leader?
As a CEO and running several companies literally simultaneously on a day-by-day basis and making precise and calculated decisions is part of the process and therefore, engaging in hobbies or as I call it “different value-add activities” outside of work can be instrumental in enhancing leadership skills and adapting to a constantly changing world.
Reading: Cultivating a habit of reading helps broadens my knowledge and understanding of various subjects, including business, leadership, economics, technology, and global affairs. It enables me to stay informed, think critically, and make well-informed decisions in a rapidly evolving business landscape.
Physical Fitness: I maintain and try to maintain an active lifestyle through exercise or walking to my meetings and getting in my 10k steps on a daily basis, which not only promotes my well-being but also fosters discipline, resilience, and determination.
Traveling: One of the values and perks my job offers is the travelling. I travel on average once per outside of UK; this is either day trips or overnight stays. This most certainly allows me to experience different cultures, meeting diverse individuals, and experiencing new environments that most certainly expands my perspective and develops my adaptability. I am proud to say, I have lived in several different countries and for me, adapting is no longer a challenge, and it is considered art!
- What do you expect 2024 to bring?
To be perfectly candid, we had no idea how 2023 was going to turn out and we managed to overcome some very challenging times in terms of cost of financing, identifying different equity partners with the same vision and alignment with ours and our clients.
Of course, the specific outcomes can be influenced by various factors and are subject to market conditions and economic trends. To continue with the positive streak and not get side tracked with the volatility of the markets and pessimism, we focus purely on
Market Conditions: The performance of the financial markets can greatly impact the activities of our group. If the global economy continues to grow steadily, it will create a favorable environment for investment and capital raising activities. However, market conditions can be volatile and subject to various risks, including geopolitical events, regulatory changes, and economic downturns. It’s crucial to stay vigilant and adapt to changing market conditions.
Deal Flow: As of 30 May 2023, we have roughly US$ 750 million of mandates within our active pipeline. The deal flow can be influenced by market sentiment, investor appetite, and industry-specific trends. If the economic environment remains favorable, we can easily see increased activity in mergers and acquisitions, capital raising, and advisory services.
Technology and Innovation: The financial industry is undergoing rapid technological advancements, including digital transformation, automation, and artificial intelligence. Embracing these innovations can enhance operational efficiency, streamline processes, and improve client experiences, which has had integrated this year but 2024, this process will be ramped up significantly.
With the foundation that I have created just within the last 5-years has allowed the company to work seamlessly and continuously grow by average 20% on average. This is simply with the structure, which I have explained above.
Talent and Team Development: As the CEO, last year, I started preparing and nurturing a talented and diverse team for the long-term success of the brand. Therefore, for 2024 and beyond, investing in employee development, attracting top talent, and fostering a culture of innovation and collaboration will be vital.
