RIYADH, SAUDI ARABIA
The 6th edition of the Future Investment Initiative (FII) Conference 2022, also referred to as ‘Davos in the Desert’ was held from October 25-27, 2022 in Riyadh. Sandbox Studios was very fortunate to attend this event having managed to obtain tickets through Fahad Saud – one of the fund’s partners.
FII, which started in 2017, has had aspirations of competing with the World Economic Forum’s annual meetings in Davos, Switzerland, which has been convening for more than half a century. Davos regularly attracts a who’s who of global leaders, economists, political scientists and media personalities.
And despite it’s relatively short existence, ‘Davos in the Desert’ is no different.
During one of the opening sessions, Jamie Dimon and David Solomon, the CEOs of J.P. Morgan Chase and Goldman Sachs, shared a stage with billionaires Stephen Schwarzman of The Blackstone Group, and Ray Dalio, who founded the world’s largest hedge fund.
Other notable speakers included Masayoshi Son, Softbank CEO; Former President Trump’s son-in-law Jared Kushner and former US Treasury Secretary Steven Mnuchin (both who now run private equity funds backed by Saudi Arabia); President of the European Central Bank, IMF Christine Lagarde; and the UK’s former Chancellor of the Exchequer George Osborne, among hundreds of other top performing CEOs and government officials.
With over 6,000 delegates, the focus for this year’s conference was changing world order with the theme “Investing in Humanity: Enabling a New Global Order” discussing a number of issues including a post Covid19 world and the importance of sustainable growth.
Sandbox Studios had a front row seat and wanted to share our takeaways:
- Perhaps the best roundtable we saw was ‘The New Global Order: View from the Board of Changemakers’ discussing what ways investors and business leaders contribute to innovations that will advance human capacity across the globe.
There was a lot of controversy around changing motivations in regards to supply chains as a result of Covid19. HE Yasir Al-Rumayyan, Governor of the Public Investment Fund, outlined the issues Saudi faced because their nation (much like many Western nations) were working on a just-in-time, cheapest supplier strategy. This strategy works wonders when everything is open, but in Covid19 caused havoc. They are now committed to working towards “having 65% of their supply chain based in the country”.
Which was not something that Sara Menker, Founder of Gro Intelligence agreed with, stating “If you do that and are a poor country, all you are going to do is get poorer. That is not a strategy that most countries can afford to do.”
Discussions about government support in this area were also enlightening with Dr. Patrice Motsepe, Founder of the African Rainbow Minerals stating, “You should never leave what needs to be done in the hands of government. Certainly not if you want to get anything done.”
The discussion concluded on climate change with Jamie Dimon, Chairman & CEO of JPMorgan Chase & Co perhaps controversially stating, “If we aren’t sitting here in the next 100 years it’s because of nuclear power struggles, not climate change.”
- The other panel that we wanted to highlight was ‘The Rise and Evolution of the VC Asset Class’ – a panel exploring how venture capital has been transformed from a cottage industry in Boston and San Francisco to a global asset class responsible for $600 billion dollars of investment in 2021 alone. Dozens of innovative venture models now exist – from solo GPs running micro funds to multi-billion multi-stage franchises; from distributed scout funds and accelerators to sector specialist GPs; from firms that only buy equity to firms that buy crypto assets, secondaries, and fund interests. The panel discussed which strategies they thought were the most promising and will define the next wave of innovation in venture.
Heather Henyon, Founding Partner at Mindshift Capital ($30m AUM) saw a huge trend towards micro funds quoting higher returns for investors.
One great comment that resonated was Magnus Grimeland, CEO of Antler ($900m AUM) who stated, “This is becoming the network era of venture capital. Founders are no longer consolidated to a couple big cities around the world. Founders are now everywhere, and great companies can be built anywhere. The VCs that will win are VCs who can create a network effect to find all the best founders because you can no longer do it alone – which is really only possible through niche VCs. This is what I think will drive the next 10 years of venture.”
This comment is one that we particularly agree with because it’s something that we have found to be a huge benefit for Sandbox Studios – our two best deals came from other VCs.
Making friends is really what it is all about.
There was also a long discussion on female fund managers with many on the panel (mostly men) agreeing that female fund managers make better managers, which is concerning/confusing when the stats show that only 2% of fund managers are women.
Henyon added, “Female fund managers are proven to deliver bigger alpha, but struggle to raise funds.”
The panel was nicely summarized by Ben Casnocha, co-founder of Village Global ($500m AUM), who stated, “What you look for in a great founder – reckless ambition – is not the characteristic you want in a fund manager.”
We will be back!
It was a fantastic event with some amazing people. I highly recommend attending for anyone who might be interested – we’ll certainly be going to the next one!