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P Capital Partners deploys Daymi for strategic planning, informed decision and effective reporting

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Proventus P Capital Partners x Daymi
Daymi – keep on top of your ops

Navigating differences between UCITS funds and AIFs can be tricky, but it doesn’t have to be. Meet Nicoleta Lagerqvist, a seasoned professional in the financial industry with a passion for driving operational excellence. After years of experience in global trading and settlements, and later in the administration of UCITS funds, Nicoleta took on a new challenge and joined P Capital Partners (PCP).

As part of the PCP team, Nicoleta is responsible for the day-to-day administration of the funds, working closely with service providers ensuring systems and controls are effectively operating. Join us as we dive into Nicoleta’s unique perspective on the differences between UCITS funds and P Capital Partners Funds in terms of operations and administration.

Can you tell us about your background?

Educationally, I have a master’s in business administration from the University of Birmingham, UK, and a Certificate in International Investment Funds from the Institute of Banking Dublin in Partnership with Irish Funds.

My work experience over the years has been largely slanted to finance but lately to the fund industry. I was introduced to the trading floor of AKJ in 2006, a reputable Hedge Fund platform and a prime brokerage services provider. The work itself has put me in contact with large investment banks and funds organisations from where I gained valuable knowledge in the trading, settlement and corporate action events of different financial instruments from stocks, bonds, and derivatives. This has extended my horizon and I wanted to understand more.

After many years in the mutual fund industry, you have joined PCP, an AIF. What brought you to that decision?

The shift to PCP occurred in 2020. This is when the process of knowledge transfer from one country to another, and from UCITS to AIFs has kicked in. At the start, I knew very little about PCP, but I already followed the market trends. I was aware of the growing demand for alternative and flexible capital, I knew about the distribution of AIFs in different EU jurisdictions under the AIFMD, and I knew about AIFMD’s challenges in trying to implement regulatory frameworks. When the recruiter thought to me about the job role at PCP, I felt ready to step into the unknown. I knew I have room to go above and beyond my intended duties and add value in at least two of their key areas such as service providers and investor reporting. 

P Capital Partners (PCP) is a leading manager of multi-strategy credit opportunities funds investing in entrepreneurial and family-owned businesses. PCP provides capital to companies that need funds to grow, make acquisitions, or refinance their balance sheet. Having raised EUR 5 billion in institutional capital, PCP acts as a strategic financial partner to our portfolio companies. They have a long experience investing in businesses and recent examples include Kry (Sweden), Mathem (Sweden), DvH Medien (Germany), and Better Energy (Denmark).

Daymi for operations management

What is the difference between a regular UCITS fund and P Capital Partners Funds?

It is essential to understand the differences between the fund vehicles and the implications each of these has from an operational and administrative perspective. 

As opposed to mutual funds that adhere to the UCITS framework (Undertaking for Collective Investment in Transferable Securities) and which can only invest in liquid transferable securities (such as bonds, shares, and money market instruments), P Capital Partners as an AIF (non-UCITS), can invest in any type of investment asset, However, this does not make us less regulated. Such investments are possible through the AIF legislation that allows greater flexibility in terms of investment mandate and structure. 

Does this restrict who can invest in the fund?

In this context, AIFMs are not permitted to market any AIFs to retail investors, only to institutional investors.

What does it take to administer an AIF?

Given the structure of our funds and the fact that PCP investments are addressed to qualified sophisticated investors with high demands and expectations, the operation and administration of our funds are fundamentally a top priority. 

PCP has placed its resources to meet a flexible funding environment where we want our investors to feel comfortable and where we can adapt and act quickly when needed without putting assets at risk. We have positioned ourselves in the center of the business surrounded on one side by a group of robust service providers (trustee, custody, prime broker, brokers, auditors, legal, fund administrator, back-office systems, etc) and on the other side by our partners, advisors, and regulators. 

Each of these parties, mentioned above, requires extensive and necessary reporting – whether this is related to fund establishment, investors onboarding and ongoing support, admin, accounting or governance – and that implies a clear structure, specific skills, specific operational processes, and good reporting practices in alignment with the AIFMD framework. It also requires substantial experience and systems knowledge to carry out the fund administration functions effectively and efficiently.

 

P Capital Partners is leading the way in sustainable seafood production with a €75 million investment in Kingfish, a cutting-edge land-based aquaculture producer. This innovative investment not only pioneers the use of private debt in land-based aquaculture, but also focuses on reducing environmental impact, improving animal welfare and decreasing waste, all while producing yellowtail kingfish in the Netherlands.

(Nominated as a candidate for European deal of the year by Private Debt Investor Awards 2022)

Proventus P Capital Partners x Daymi

What are some of the operational challenges you have faced during your time at PCP?

One cannot deal with and overcome a challenge without embracing the notion of change. Sometimes certain changes can be predictable to some degree, sometimes not, especially in a constantly changing environment.

It was very evident during the pandemic that working remotely was a challenge. Such a large macro event has forced PCP to approach digital interaction and reshape the business models. Remote working is very different to office working, and technology has been instrumental in facilitating the new way of working. And as work patterns have changed, so have businesses become vulnerable to cyber threats.

What steps did PCP take to manage operational risk at that time?

PCP started to look not only at the “prevent versus recover” approach in terms of cyber security protection but also to assess whether our servicing capabilities are enough to satisfy a certain operational demand.

We developed contingency plans, assessed and adapted working practices, harmonised and adjusted day-to-day workflow processes and made them uniform or mutually compatible. We also implemented systems and documented automatisation to ensure the overall business does not suffer operational disruption and reputational damage.

This was possible with the implementation of Daymi. Daymi has helped us track, plan and analyse organisational needs, implement regulatory and reporting changes, act effectively, and improve performance & results as well as inefficiencies. It helped us have a coherent set of responses that make change workable. And not only that, with Daymi the knowledge stays in-house.

Daymi has helped us track, plan and analyse organisational needs, implement regulatory and reporting changes, act effectively, and improve performance & results as well as inefficiencies.

What is your view on business digitalisation?

Digitalisation has already changed the financial system. In the same way, the financial industry has been disrupted because of regulation. 

To some extent, digitalisation is a new way of working, even though services and systems are still middlemen, and many other administrative assignments are still in the traditional space operated by humans. But I don’t know for how long. And it is hard to predict how far it will go. Would it be easier to build a whole new financial system from scratch or to continue reforming the old one? 

Reinventing a new system will take time and there will be no margins, no values, and no revenue to provide in a decentralised world within 10 years from now. And because we don’t know what the future will bring, we have to maintain a fluid mindset. 

How do you see the future of financial operations?

Digitalisation does play an important role. Funds that already use digital innovation have become agile in managing and delivering data in a secure environment allowing improved operational efficiency. But digitalisation does not come for free nor without risk. It involves an investment with the main goal to ensure cyber protection for businesses, investors, and organisations.

PCP Transition Fund is proud to play a part in the growth and success of Scandinavian Biogas. PCPs SEK 300m financing will help the company expand its biogas production, becoming a leading producer of clean and sustainable energy alternatives. This investment aligns with PCP Transition’s mission to drive change by supporting companies that are making a real difference in reducing CO2 emissions and promoting renewable energy. We are excited to see the positive impact this will have on the environment and the community.

Proventus P Capital Partners x Daymi