9fin Q&A: Starting Something New

1. Seven months in to launching your own firm, what are the biggest lessons you've learned so far?

The first is that constructing a best-in-class team takes time and patience. This is also a process that cannot be shortcut, since it is the single most important aspect of the firm. We’ve built (and are continuing to build) a great team and culture, and I’m convinced this will make us successful in the four pillars of firm building: operations and infrastructure, investing, capital formation, and fund management.

2. What sector or type of investments are your main focus right now?

We focus on the top or near the top of the capital structure, with meaningful influence and governance rights to control duration and exit. On the sector side, we're most excited about what we call "old world" opportunities, including industrials, manufacturing, critical minerals, infrastructure, and materials. We're also watching financial services and insurance closely.

3. How have you adjusted or do you expect to adjust investment strategy as market conditions shift since you launched?

Investment strategy should always evolve depending on market conditions and opportunity set. We regularly develop new themes and grow our caution where it makes sense. Still, I won’t chase “hot” sectors just because they’re in style. Our core principles don't bend to market cycles. Occasionally, that discipline may mean passing on opportunities or sitting on capital for stretches of time. We're comfortable with that because capital preservation and selectivity keep you relevant through cycles.

4. Private credit has been a major topic in recent months in large part because of exposure to software credits thought to be potentially impacted by AI. How does Ferghana fit into that narrative?

I think we will be the benefactor. As an emerging manager, AI is immediately applicable and transformative in our own business. Its application will also be transformative in the industries we’re looking at. We’re leaning into the disruptive potential of AI, not only in the software space but beyond.

5. As founder/title what are your main responsibilities at the firm and what’s your day to day like?

As you’d expect from a new manager, my responsibilities span the full business: operations and infrastructure, sourcing and evaluating investments, and capital formation. Fortunately, I have strong leaders that I trust leading these efforts alongside me.

6. Earlier this year you announced a partnership with New Catalyst Strategic Partners, which is an affiliate of Apollo. What exactly does that mean for Ferghana?

The partnership means more than simply capital. From the start, I wanted a partner that cared about building the business, not just funding it. New Catalyst's perspective around firm formation and capital raising has been as valuable as the commitment itself.

7. What's it like building a team from scratch and hiring these days?

No doubt this is the most difficult part. The pitch to a candidate is: leave your comfortable seat at an established firm, bet on us, and help build something. That's a hard ask. The people who say yes tell you a lot about who they are. Up to this point, we’ve been successful and have de-risked this part of the ‘startup’ nature of the firm.

8. Now that Ferghana is up and running, what are your firm’s goals for the coming year and beyond?

Keep building the four pillars of the business mentioned earlier. In terms of doing deals, founders and entrepreneurs who want to grow or who have reached an inflection point in their businesses don’t have many capital options. I see this becoming even more pronounced as the year goes on. So, we will capitalize on the constant flow of intriguing opportunities coming across our desks.

9. What is the significance of the name Ferghana?

My last name means ‘horse’ in Chinese. Ferghana is one of the earliest and most prized horses imported into China. It felt like the right name.

‍

Reprinted with permission from 9fin