Welcome back to our September newsletter edition.

In this issue, we examine a recent article by our associate advisor, Charles Troian, on finding focus in volatile markets–something many of our readers may find comforting and relatable.

We’ve had exciting guests on The Exchange Podcast recently, including Mark Washbourne, co-founder of ReadyTech, and retired army leader Major General Fergus McLachlan AO. We recap these episodes and more below. 

Lastly, we’d like to thank everyone who attended the boardroom lunch we recently co-hosted with J.P. Morgan. 

As always, stay informed and invested.

Finding Focus in Volatility

“I recently finished reading Stolen Focus by Johann Hari, an insightful investigation into the collapse of humanity’s collective ability to concentrate. Amongst several ideas, Hari argues that as a society, we are obsessed with distraction and, whether we like it or not, our attention is being sold to the highest bidder. The book convincingly dissects the global attention crisis, which has been guided by our increasing use of technology, social media, and access to information. Humans, in general, are finding it increasingly more difficult to focus on one thing at a time. 

Ironically, it took me about 6 months to finish this book, but its conclusion comes at an interesting time for reflection. Earlier this week, we witnessed one of the most significant market panic events of the last four decades. This correction was driven largely by a weaker than expected US Jobs report that prompted recession concerns and was exacerbated by an unwinding of the Yen carry trade. Unlike individuals, markets often appear to be more than comfortable with directing their focus to one thing at a time, but like individuals, this is often brief, as they move to focus on the next inflation print, the next earnings call, the next polling result, the next regional conflict, and so on and so forth. Market volatility is simply an expression of the fleeting focus of its participants. This is a basic concept, but one that investors must understand on the path to long term wealth preservation and creation. 

In this note, I will reflect on the market volatility of this week, the probability of a US recession, and what a recession means for client portfolios.”

Read more from our associate advisor, Charles Troian’s article here. 

The Exchange Podcast Catch-Up:

Check out our latest episodes from The Exchange Podcast:

Major General (Retd) Fergus (Gus) McLachlan AO: Geopolitics, Leadership and Cybersecurity, Lessons learned from 37 years in the Army

In this episode, Managing Partner Tim Whybourne catches up with Gus McLachlan AO, a distinguished leader who retired from the Australian Army in 2018 after an illustrious 37-year career. Fergus held key roles such as head of Modernisation and Strategic Planning, deputy chief of Staff for Plans at the HQ ISAF Joint Command in Afghanistan, and chief of staff for the Office of the Chief of the Defence Force, culminating his career as Commander of Forces Command, leading 35,000 ground forces personnel.

They discuss everything from Fergus's extensive military career and leadership lessons to his insights on building and maintaining high-performing teams. Fergus shares his experience in strategic planning, cultural and organisational change, and integrating innovative technologies like cyber, robotics, and data analytics. They also discuss the current geopolitical outlook and the risks to Australia’s sovereignty.  Tune in to hear his thoughts on transitioning to the commercial and university sectors and his advice for emerging leaders aspiring to make a significant impact.

Marc Washbourne (Readytech RDY.ASX)

Our Managing Partner, Tim Whybourne, catches up with the CEO and co-founder of ReadyTech (ASX:RDY), Marc, who has overseen its growth from early product development in 1999 to leading the ASX-listed SaaS company with a reach across education, workforce, government, and justice sectors—from Australia/NZ to a global customer base. With over 25 years of experience in business leadership and technology, Marc heads up ReadyTech’s global team of over 500 people who are committed to supporting more than 4,600 customers with mission-critical technology.

Marc bootstrapped the company from private equity ownership to an ASX-listed company, growing it from 2 staff to over 600. In their discussion, they discuss the challenges of scaling a tech business through the different phases, what it takes to be a good leader, and what they are doing to embrace the ever-evolving technology landscape. 

Steve Byrom (Potentum Partners Private Equity): The Opportunity in Global Secondaries 

In this discussion, we chat with Steve Byrom of Potentum Partners. Steve is a Founding Partner of Potentum Partners. Before Potentum Partners, Steve spent 11 years as Head of Private Equity and Investment Committee member at Future Fund, Australia’s sovereign wealth fund. He led the team that created Future Fund’s private equity strategy, building a $27.5bn investment program.

We cover the basics of private equity, secondary, and primary transactions and highlight some of the key deals they have done recently. We also explain why it is important to invest in the top half of Private equity performers and the importance of continuing to allocate to private equity throughout a cycle. Potentum partners are currently raising capital for their new semi-liquid secondaries fund.

Mark Carnegie (MHC Digital): Why one of Australia’s Most Respected Investment Bankers is investing in Crypto

Mark has over 30 years of experience as an entrepreneur, investor and corporate advisor in New York, London and Sydney. From 1990 to 2000, Mark was the Australian and Asian representative of Hellman & Friedman following his training on Wall Street with James D.  Wolfensohn and in London at Hudson Conway with Lloyd Williams. In 2000, Mark co-founded the leading Australian boutique corporate advisory and private equity firm Carnegie, Wylie & Co Pty Limited with John Wylie. 

Throughout his career, Mark has been involved in a range of diverse Australian and  Asian investments and has participated in groups that have acquired major stakes in the  Courage Pub Estate, John Fairfax Holdings, Hoyts Cinemas, Formula One Holdings, SCTV, Macquarie  Radio Network, Lonely Planet Publications and London Sumatra Plantations. As a corporate advisor, Mark has advised Qantas and Coles Myer on general strategic matters, Westfield on its A$22 billion merger and Qantas on its JetStarAsia start-up in Singapore. 

Join us as we listen in on a recent call we had with Mark regarding the case of having a meaningful allocation to crypto assets in your portfolio.

To discover more about each episode, head to ‘The Exchange by EWL Private Wealth’ on Apple Podcasts.

Disclaimer:

The information in this podcast series is for general financial and educational purposes only, should not be considered financial advice, and is only intended for wholesale clients. That means the information does not consider your objectives, financial situation, or needs. Consider if the information is appropriate for you and your needs. You should consult your trusted licensed professional adviser before making any investment decision.

Thank you to our fantastic presenter Ashmi Mehrota, Global Co-Head of Private Equity at our co-host J.P. Morgan, and everyone who attended our recent boardroom lunch. 

It was very valuable to hear Ashmi share her deep insights on how the J.P. Morgan team assesses opportunities in the small and mid-market sector and the role of Private Equity more broadly. 

Private market investments regularly outperform public markets, so it is critical for all investors to be aware of private market opportunities. As a business, we are proud of the opportunities we open and present to our clients across the globe to help them build wealth today and into the future. 

Investing at all-time highs

While this article was fairly recent, we felt it was a timely message to reshare, given the early August market volatility and subsequent market moves higher. 

In this piece, our partner Tim Whybourne tackles some of the key questions investors have during bull markets, specifically whether investing is worthwhile, and highlights the historical trends that drive long-term investment decisions.

Thanks for reading! We’ll see you again next month.

www.ewlwealth.com.au 

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