Dubai multi-family office GSB Capital will seek impact growth funds focused on SMEs next year. According to founder and CEO Ross Whatnall, the $500m allocator is looking to diversify its total portfolio by shifting part of its fixed income sleeve to alternatives.
The firm is most keen on UK and US-focused GPs but is also open to GPs concentrating on the Middle East. For its future allocations, the investor targets GPs focused on SMEs.
GSB tilts towards food sustainability, transportation (electric and trucking), cyber security, and clean energy sectors for its growth ESG-focused opportunities.
“We look for companies and sectors disrupted by technological innovations through sustainability. It’s a good time to be focused on ESG because there’s a nice intersection between what’s ethical and what helps to tackle climate change. But also, there’s just huge growth potential. It’s a nice synergy,” explained Whatnall.
GSB leans towards ESG-focused sector specialists for its future growth allocations.
Allocations will depend on client needs
The investor does not have an upper limit regarding ticket size as it would depend on each client’s risk profile and the percentage allocated to their alternative investments.
“Our main focus is ensuring the client isn’t overexposed to alternatives as a percentage of their portfolio. Once we’ve ensured it’s proportional, we can diversify their allocation to alternatives among our opportunities. And if we can diversify their exposure, it is even better,” said investment analyst Ryan Clarke.
GSB wants managers with at least ten years of track record. The firm’s minimum requirements AuM hover around $10m.
The firm is more careful when selecting growth players. When conducting due diligence, it takes a deep dive into the GP’s performance and transparency.
“We have our internal due diligence process, and it is paramount. If we’re in dialogue with a manager and it’s proving difficult to access certain things, that would be the biggest red flag for us,” explained Clarke.
“We look for people we feel we can trust. A big part of it is performance. But ultimately, can we trust them? Are they accountable, and are they transparent?” he added.
GSB wouldn’t typically work with funds with management fees in excess of 1%. Ideally, it seeks a 0.5% fee as it looks to keep charges well under 1% on a client’s portfolio.
The MFO has recently partnered with Venley Capital and Klint Ventures.
“Klint Ventures have achieved growth of in excess of 50% in just over 12 months, so they are very well aligned with what we’re doing. It’s just a perfect synergy with our business,” said Whatnall.