Liontamer's
new pride of place
Photo by Michael Bradley: Sunday Star Times
Female funds group targets Aust
By Garry Sheeran, Sunday Star Times: 28
May 2006
It's just the place for lion tamers – the lion's den. In this case the den is Australia, where from the mid-90s many Kiwis bought fancy structured investment products.
The unlikely lion tamers are four young, fired-up professional women who three years ago began designing, creating and marketing a new breed of capital-protected financial products for New Zealanders.
They've been so successful here that they're now planning to take their Kiwi-made Liontamer products – still the only ones of their kind – to Australia.
Janine Starks admits they will face more competition across the ditch.
"But compared with the place of structured products in European and Asian markets, Australia is not much better than New Zealand", she said.
Australia also represents a huge managed funds market – the fourth biggest in the world – and Starks is confident they will do well there.
"But we'll be starting small, and building our way to success," she said.
Which is what they have done in New Zealand, since they launched their first capital-protected structured global equity investment fund in August 2003.
Since then Liontamer has:
- Started a further 14
funds, including commodities and currency
funds in New Zealand.
- Offered investors 19 investment
products within those funds, with another
two on the way.
- Taken in more than $100 million from
retail investors in one of the most fiercely
competitive businesses
in New Zealand.
- Been named in a Microsoft/NBR
survey as one of the most exciting new companies.
- Had its managing director, Laetitia Peterson, voted one of the most influential people in financial services in New Zealand by Asset magazine.
"We're obviously doing things differently and getting noticed," said Starks.
Part of the difference is having a business owned and run by young women in an industry dominated by the dark-suited, middle aged male brigade.
Unusual, staid Starks, but entirely coincidental. And not unique, because of Carmel Fisher's Fisher Funds Management business.
But Fisher's success may have helped pave the way for the Liontamer foursome. "We go to business meetings and comments fly about "four Carmels, one for each lunch table'," said Starks.
Also different is the way Liontamer operated a virtual office from four homes – Starks in Christchurch and Peterson, Vanja Pivac and Patricia Newell from their Auckland homes.
Operating that way is part practical. "A lot of my work is done on the phone to global investment banks in London around midnight," said Starks. "Operating out of a glass tower inner-city office is not an option at that time – especially not for a woman." A home-based business suits Peterson, who has two children. It also means Liontamer keeps lean and mean, avoiding the bugbear of many managed funds – overheads and backroom costs.
They are getting noticed from two directions. An increasing number of retail investors are willing to put their money into Liontamer's structured products. Many fund managers with big global connections would die for $100m under management after three years. Liontamer products' attraction, said Starks, was their capital guarantee. "Investors are happier to place their returns at risk than they are to place their capital at risk".
Liontamer products allowed investors to put money into riskier underlying assets, while protecting the capital from erosion. Among those risky assets, which are usually a no-no for retail investors, are commodities, in which Liontamer has been offering two funds.
The first, due to mature in October 2007, locked in oil at $US31 a barrel two years ago. It has risen to more than $US70 since. The $1 units are now worth $2.49.
A second commodities fund had an early maturity feature so Liontamer is now cashing up the fund and returning money to investors. They have a realised 40% gains in only 17 months.
Bigger industry players are also now noticing who Liontamer are. Starks said big banks and financial advisory businesses usually made sure you survived your first three years before they would invest their clients' money. "We always felt that was a bit rough, given the capital protection for our products is being supplied by such global giants as Barclays, Deutsche and Morgan Stanley," said Starks.
But now the big players are starting to put client money their way, and girding what Starks hopes will be the next phase of Liontamer's growth.
On reflection, said Starks, opening a niche space for a Kiwi investment product was risky. But it was the experience she and Peterson had in international markets that gave them the confidence.
Starks spent six years in the structured product market in Britain with the Chase de Vere financial advisory group. Peterson has worked with financial derivatives in Chicago, with Goldman Sachs in New York, and her homeland of Belgium.
"There are 70 Liontamers in London. We new the business and its potential. We knew there were opportunities in New Zealand if we did it well," said Starks.
Pivac, who heads compliance and operations, joined the business a year ago after being involved with Liontamer for two years as a senior associate with law firm Bell Gully.
Newell is a Canadian, just arrived in New Zealand, and an associate of Peterson's from her years in the United States.
