With David Nangle I talked about the strategy of VEF – the emerging market fintech investor (formerly: Vostok Emerging Finance).
We discussed the following:
00:00 Introduction
00:18 “VEF – The emerging fintech investor” – Why The?
02:15 Competition in the emerging markets
03:45 What is Fintech?
05:28 Limitations of fintech
07:55 Global spread of companies
10:27 Cash from the perspective of a fintech investor
12:22 Exchange rates in the investment process
15:35 Difficult emerging markets to invest in
17:09 Competitive markets
17:50 Assessing risks
19:50 The lean setup of VEF
20:50 Choosing investments: Quantity vs Quality
22:19 What kind of investor is VEF?
23:35 Timeframe
25:03 Selling
26:20 Improvements over the past 5 years
28:18 Why did he join VEF?
30:29 His motivation
32:08 Views on retirement
32:50 The relationship with VNV
34:51 How is the competitive landscape?
36:30 Skin in the game
37:20 Compensation at VEF
37:58 Buybacks
38:56 Portfolio construction
40:54 Pain points
42:12 Replicating models of the developed market in emerging markets
44:01 Loss-making investments
47:11 Evaluation process
48:35 Can loss-making investments be turned around?
49:40 Investing time in certain companies
50:51 Creditas
54:10 Potential risks for Creditas
55:12 Ideas for future developments for Creditas
56:35 Investment thesis for Konfio & the Mexican market
58:23 Optionalities in the businesses
01:00:26 Moving concepts out of emerging markets to developed markets
01:02:20 The next frontiers
01:03:48 Opportunities in the portfolio
01:05:46 VEF in 5 years (Community exclusive)
01:06:35 Closing remarks from David
01:07:30 Thoughts on scalability
