This month’s The Entrepreneur section features Mihir Kapadia who is the founder and CEO of Sun Global Investments, a leading, integrated, boutique financial services firm specializing in emerging markets.
Mihir was born and raised in India, which he left at the age of 18 in 1990 to study in New York. He graduated four years later with a MBA in International Finance from St. John’s University.
Sun Global Investments is headquartered in London, with an office in Dubai, forging a strong foothold in the international and emerging markets with assets under advice over $500mn.
The company provides a full scope of services to Institutional Investors, Family Offices, Corporate Clients and High-Net-Worth Individuals across wealth and investment advisory, securities trading, corporate finance and real estate advisory. Sun Global Investments is the creator of the world’s first India fixed income ETF on the LSE and recently we have been very excited as the fund reached its first $10m benchmark.
Can you tell us a bit about your career path prior to founding Sun Global Investments?
While I was living in the US, I decided to set up my first business – basically trading commodities and making investments. Whilst most of my colleagues seemed somewhat oblivious to the developments in emerging markets like Africa and Central America, I found that this was an area that I was immediately interested in. It was an interest that I would explore fully with Sun Global Investments in years to come.
At the time, however, I made the decision to move to Romania and take over the family business. By 2000, I had grown restless and so decided to move to the UK and London – a city I saw as the world’s financial hub. Soon after setting up a financial services firm, I had to navigate my fledgling business through the DotCom bubble bursting, which once managed led us to making waves and outpacing competitors. My old interest in emerging markets soon returned and this, coupled with my realisation of the potential of wealth and fund management, led me to part ways with the company in 2008, spread my entrepreneurial wings and launch Sun Global Investments.
You started Sun Global Investments and have since grown the company from London to New York and Dubai, despite the financial crisis and recession – how did you manage to achieve this? Can you tell us a bit more about how did Sun Global Investments develop into the company that it is today?
Being a small player, we have been one of the most innovative and idea-centric houses in this business. We were able to find a niche for ourselves by doing things differently, by having a different voice, almost being a little different from the consensus in our approach to risk, regulation and life in general.
From the early days, we were solely focused on emerging markets. Having the emerging markets versatility helped us to develop better results, as they were doing better, and helped us introduce new ideas. We have also focused strongly on the quality and intensity of service that we provide to our clients, which has allowed us to differentiate ourselves in difficult times.
We focused on being mean and lean, which could not have been possible without a strong team behind our efforts.
What would you say is the best thing about running your own company?
I feel it gives you an opportunity to put your ideas in practice and work towards seeing them grow and succeed.
What has been the most complex challenge that you have been faced with during your career? How did you overcome it and what did it teach you?
The development of my business was intimately linked with the burgeoning financial crisis of 2008. The year that I launched Sun Global Investments was the year of the most devastating financial crisis of recent history – not the most opportune timing. I already had a little experience in this field, having navigated my previous company through a previous crash, and so I knew that to survive this one, I would have to keep a calm head. Everyone lost so much faith in developed markets so quickly that I knew that the growth of emerging markets would be the key to unlocking a bright economic future.
With this in mind, we stuck to our guns and chased down every potentially lucrative investment opportunity we could find in any of our key emerging markets and created some good cut-through in an otherwise struggling industry.
What would you cite as your career highlight to date? And what burning ambitions do you still have for the future?
I would consider creating a niche market that didn’t exist before as the main highlight of my career. This allowed me to become a major player in convertible bonds, transforming my ideas into growth opportunities such as developing an Exchange Traded Fund (ETF) which allows investors to be exposed to bonds issued in rupees by Indian government owned companies. The Sun Global Zyfin SOE Bond UCITS ETF, which was and remains a global first has just completed its first year of trading and has given a return of 8% in USD and Euro tranches as well as a 30% return on the GBP tranche thanks to Brexit.
What’s your golden nugget of advice for young entrepreneurs?
You have to think big and believe in your idea. When the world was going zig during the financial crisis we were moving zag. We were able to find a niche for ourselves by not only doing things differently but thinking differently as well. We became known in the industry as an ‘ideas factory’ by having a different voice, and almost being anti-consensus in our approach to risk. You need to remain confident that there is growth ahead.
What excites you about the near future? What does 2017 hold for you and Sun Global Investments?
People have sold off emerging markets in the last three years, with the most recent reason for this negative sentiment being the push for a stronger dollar due to the Trump victory. This victory has been negative for emerging markets currencies and assets. The upside to this sentiment is that emerging market assets are now cheaper and likely to outperform in the medium term.