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1/ You have an impressive career investing in publicly listed equity markets. Could you share your background with us?
I was born into a multicultural family, with a Spanish father and a Portuguese mother, and I’ve spent the last 17 years living in London. Academically, I graduated with a BA in Economics from the Nova School of Business and Economics, where I developed a strong interest in financial markets, which laid the foundation for my future career.
My first experience was in Madrid, working at Merrill Lynch, where I was involved in selling mutual funds and managing client relationships. It was there that I discovered my passion for financial analysis and investment management. This interest led me to London, where I had the opportunity to work with some of the world’s most renowned investment firms, such as BlackRock, Fidelity, and Och-Ziff. In these roles, my focus shifted from managing relationships to directly managing money, which allowed me to develop a deep understanding of equity markets and hone my skills in portfolio management.
Later, I co-founded W4i (Working 4 Investors) alongside the legendary investor Firmino Morgado. We achieved significant success in terms of performance, unfortunately not matched by our asset-gathering capabilities. This venture caught the attention of Man Group, which offered us the opportunity to manage a number of mandates, both long-only and hedge funds, over the past five years.
2/ After two decades of an outstanding track record, you decided to interrupt your career and pursue the entrepreneurial path by launching a SF. What motivated you to do this? And why did you choose the Iberian Peninsula as your target market instead of the UK, where you have your entire network?
My decision to shift my career and launch a SF was driven by several key factors. Firstly, the opportunity I saw in the market was compelling. In the Iberian Peninsula, there are significant demographic trends and a lack of succession planning among business owners that create opportunities to acquire good companies that might not otherwise be available for sale. This represents a unique chance to step in and help these businesses transition smoothly while preserving their legacy.
Secondly, there’s a noticeable difference in valuations between public and private markets. Good companies are priced very differently depending on whether they are publicly listed or privately held. Part of this is due to liquidity differences, but part of it is also due to pure market inefficiencies. This gap in valuations presents a great opportunity for those willing to dive into private markets and take a hands-on approach to value creation.
Thirdly, I see tremendous potential in SMEs: these businesses are inherently resilient, but many have yet to fully tap into opportunities for professionalization, digitalization, and internationalization. There’s a lot of unexploited potential here, and I believe that with the right approach, these companies can achieve significant success.
Lastly, there’s a personal aspect to this shift, my desire to leave a legacy that goes beyond my existence. I want to make a meaningful impact, not just in terms of financial returns, but by helping to build and grow companies that can thrive long after my involvement.
Regarding my choice of the Iberian Peninsula over the UK, this decision is deeply rooted in my background. I have dual nationality, Portuguese and Spanish, which has been further reinforced after marrying my Spanish wife. Portugal and Spain share many cultural similarities, unlike the UK, which is quite different. I believe it would be challenging for me to generate the necessary empathy and trust with a British owner for them to feel comfortable entrusting me with their business. In contrast, my European network, particularly in Iberia, is very strong. This experience gives me a strong foundation to understand and connect with business owners in this region.
Actually, I hadn’t heard about SFs until relatively recently. It was a friend from Harvard who introduced me to the model. My original idea was to set up a private equity structure to buy one company. It was upon his suggestion that I delved into what SFs were and the kind of companies the model advocated for – and guess what, the definition of a solid company in a healthy industry matched exactly what I had learn to appreciate over years and years of deploying capital.
3/ Your profile is unusual: no MBA, 20 years of expertise in public markets, leaving the UK to launch an SF in Spain—the most competitive market right now, with nearly 50 SFs looking to acquire a company. Despite these challenges, you raised €450k, which is at the higher end of the capital typically raised by an SF, and you did it in less than 4 months. What’s your secret?
I wouldn’t call it a secret; it’s more about mindset and approach. Let’s start with the idea of an “unusual profile.” I recently read “The Outsiders: Eight unconventional CEOs and their radically rational blueprint for success” by Will Thorndike. It’s a fascinating book that reflects on eight CEOs who were best-in-class at generating shareholder value, despite flying under the radar. None of them had previous CEO experience, and many didn’t have MBAs. What they had was a unique perspective and a willingness to do things differently. I resonate with that. I don’t believe a traditional background is the only path to success.
For me, it’s about “running my own marathon.” I’m not competing against other searchers. The market is big enough for everyone to find the right company, especially given the aging demographic and the lack of succession planning. There’s a lot of opportunity out there. I focus on my race, my pace, and my objectives.
Regarding fundraising, there is no secret formula other than hard work and having a process. As the legendary South African golfer Gary Player said, “The more I practice, the luckier I get.” It’s about putting in the effort, day in and day out.
As a portfolio manager, you get used to dealing with outcomes—today you win, tomorrow you lose. There are no excuses. You learn to detach, refine your process, and do it all over again. That mindset is crucial in fundraising. I focused solely on raising capital—I didn’t try to do it in parallel with searching for a company. I believe that when done right, fundraising is a job in itself.
I spoke with as many people as I could and put in the work. There’s no shortcut or magic trick—just a relentless focus on the goal and the determination to see it through.
4/ Being able to choose your partners is a luxury that not all searchers can afford. Why was this so important to you, and who are the investors that ultimately back your venture?
Choosing the right investor base was the single most important task during the fundraising period. In fact, there isn’t much more to do during this phase than to focus on securing the right partners. I wanted to ensure that I was aligning myself with investors who not only shared my vision but also had compatible investment objectives, styles, time horizons, and views on valuation. It’s crucial to understand that due diligence works both ways—just as investors are assessing me and my venture, I am equally diligent in understanding them.
In my case, the fund was oversubscribed at 150%, which gave me the flexibility to be selective about who to get on board. I ultimately chose 18 investors (and they chose me!) – towards the high end of the range but the number I feel most comfortable with. The SF model advocates for a fragmented investor base and that is what I looked for.
It includes institutional players such as Alza Capital, Aurica Search Fund, Novidam, Scipio Holdings, and TTCER Partners, and family offices such as RPG Capital, the Ruiz Family, Turtle Capital, and TMB3. Additionally, I am fortunate to have private investors and former searchers such as Will Thorndike, Luis Camilleri, Tobias Raeber or Alex Tuya. And other individuals who have preferred to remain anonymous, I decision I fully respect. Each of these investors brings a unique perspective and experience to the table, which will be invaluable as we move forward.
Having the right partners is about more than just capital; it’s about having a shared understanding and commitment to the long-term success of the venture. By carefully selecting these partners, I’ve ensured that we are all aligned in our goals and approach, which is critical for the journey ahead.
5/ What advice would you give to someone considering raising an SF? Is timing important?
Raising a SF is a significant undertaking, and my advice would be to focus on a few key areas. Firstly, learn about the ecosystem. The SF community is unique; it’s much more collaborative than competitive. There’s a real sense of shared learning and support, and you’ll find that there’s no excuse not to reach out and have conversations with others in the space. This includes those who haven’t been successful as well. Their experiences are just as valuable, if not more so, because they can provide insights into what can go wrong and how to avoid similar pitfalls. I spent a lot of time reading and learning from others to understand the landscape better.
Secondly, you need to learn about yourself. Raising a SF is not just about the destination but about enjoying the journey. It requires a deep soul-searching exercise where you have to be honest about whether you have the necessary attributes—humility, creativity, coachability, and tenacity. These are crucial qualities for anyone looking to embark on this path. You have to be prepared for the ups and downs and be ready to adapt and learn along the way.
Another important piece of advice is to get your close ones on board. There’s an old African proverb I like which says: “If you want to go fast, go alone. If you want to go far, go together.” Raising a SF is a family endeavor more than an individual exercise. It’s important to have the support of those closest to you, as their backing is crucial for the long haul. And I am most fortunate to have my family’s support, otherwise this journey would not be possible and I would probably still be a portfolio manager for a large financial institution.
As for timing, I believe one’s opportunity cost is the best example of commitment. It’s not just about what you could be earning elsewhere, but about what you’re willing to give up to pursue this venture. In my particular case, stepping away from the hedge fund industry to take on this challenge was the ultimate proof. It shows I have full confidence in the SF model and in the success of this project.
So, to anyone considering raising a SF, I’d say: do your homework, be introspective, ensure you have the support of your loved ones, and be ready to commit fully. Timing does matter, but more important is your readiness and determination to take on the journey.
6/ Being half Spanish and half Portuguese, you are now beginning to look for a company in both countries. How are you approaching this search phase?
My approach to the search phase is quite focused and deliberate. To start, I have no intention whatsoever of examining the entire market. Some industries simply do not fit the SF model—they might be too cyclical, too seasonal, in structural decline, too capital-intensive, or project-based. These types of business models don’t align with the long-term value creation we aim for in a SF, so I’m not spending time on them.
Instead, I’m focusing my search on specific value chains that consistently generate value and can distribute that value among all stakeholders, including employees and the community. The goal is to identify sectors and companies where value creation is a sustained effort, not just a one-off occurrence. To do this, I aim to become an insider in those industries—speaking the language, building relationships, and truly understanding the business dynamics from the inside out.
I firmly believe the seller is always going to know more about the business than I do. The only way to close that knowledge gap is by developing deeply knowledgeable in specific industries, which is why I’m concentrating on a few select sectors rather than spreading myself too thinly.
I have a strong preference for splendid companies at reasonable prices rather than mediocre companies at cheap prices. It’s not about finding the cheapest deal; it’s about finding companies with real potential for growth and scalability. For instance, I’m particularly interested in the technology sector because it allows for economies of scale, which can significantly increase margins. In technology, you can scale revenues while keeping fixed costs relatively stable, which is a powerful formula for long-term success.
I’m also looking at “under-the-radar” sectors—those that aren’t necessarily flashy or “sexy” but offer compelling opportunities. These are often overlooked by larger investors but can be very attractive if you know where to look.
7/ Thanks to your career, you have a deep knowledge of industries and have met many CEOs of high-growth listed SMEs. Will this influence your search, as you try to find a company that aligns with what a potential buyer might want in the exit phase? SFs typically aim to buy companies at less than 6x EBITDA, but you are willing to pay more if the company warrants it. Do you think your investors will support this?
Absolutely, I am a strong advocate of shifting the focus beyond EBITDA. While profitability is often used as a quick metric for evaluating a business, it doesn’t tell the real story. Free cash flow generation is the critical factor in value creation. It’s not just about how much profit a company makes on paper, but how much cash it can actually generate after accounting for necessary capital outflows. Often, the importance of capital intensity—both in terms of capex and working capital—is underappreciated. A business might have a high EBITDA margin but require significant ongoing investments to maintain its operations, which can reduce the amount of free cash flow available.
When considering the potential for an exit, my focus is not on planning a quick sale. I’m looking for an exceptional business that I wouldn’t want to part with easily. The vision is clearly long-term, with an emphasis on sustaining and growing the business, rather than just positioning it for a flip. The idea is that a sale should be optionality, not a priority. From day one, I approach this with the mindset of being the owner for the long haul, building a business that is so strong and attractive that, should the right opportunity arise, an exit is an option, but certainly not a necessity.
I am confident that my investors will support this approach. They understand that the SF model has evolved over time, and there is substantial evidence proving its effectiveness in creating value that exceeds other asset classes. My strategy is oriented towards building a business that can deliver extraordinary returns over its lifetime, not just in the short term.
8/ “Based on your investment experience, are there any characteristics of the ideal SF target company that resonate particularly well with you? Additionally, is there anything you believe is underappreciated or overlooked?”
Absolutely, I fully identify myself with the paradigm company the SF model advocates for. Over the years, the SF model has refined itself, evolving to a point where it’s reached a mature status. The statistics about value creation for shareholders are impressive, often outperforming other asset classes. This evolution has aligned perfectly with my investment approach, which has also shifted over time towards a more refined focus on finding companies that can generate consistent free cash flow, regardless of economic conditions.
However, in my humble opinion, there’s a critical chapter still missing in the Primer on SFs, and that is culture. Peter Drucker famous quote “Culture eats strategy for breakfast” resonates strongly with me. In my professional investor’s life, I observed first-hand numerous examples of companies in the same sector and in theory exposed to similar external conditions, with completely different return outcomes. The most striking difference between them? Culture.
And it goes well beyond a company’s mission statement. In fact, I am not even sure a company needs one to have a strong culture. We’re talking about how a company operates on a day-to-day basis—how decisions are made, how employees are empowered, and how the organization adapts to challenges. For example, successful companies often exhibit traits such as decentralization, where decision-making is pushed down to the lowest possible level, and employees are given real responsibility and ownership over their work. This creates a culture where people are not just executing tasks but are genuinely entrepreneurial within the company structure.
You rarely find a fantastic leader behind a mediocre team, and vice versa. I came to realize that in most companies, they share the same features, and more so in the SME environment where most probably the owner chose every single person under his helm. That’s why, when looking for a target company, I am particularly focused on the founder’s character and how he comes across. I want to see a leader who embodies these cultural values and who has built a team around those same shared principles.
