The Monaco Private Equity and Venture Capital Association has existed for six years. Its president, Zsolt Lavotha, explains its objectives.
Our organisation, MVCA, aims to attract new investors to Monaco. At the same time, it strives to promote a category of assets which has long existed and which is now becoming more popular: private equity.' Lavotha explains that in Europe, the practice began in the United Kingdom in the 1940s. More recently, companies as varied as Facebook, Amazon, FedEx, Microsoft, Hugo Boss and Orangina have turned to private equity. The idea is to support and/or relaunch development through granting private funds to companies in all sectors and of all sizes, whether or not they are experiencing financial difficulties.
An ambassador for Monaco
To share his practical knowledge, Lavotha has presided over an organisation created in 2006: Monaco Private Equity and Venture Capital Association (MVCA). 'We only represent ourselves' he stresses, to avoid the assumption that the State has conferred an official role upon him. Surrounded by individuals from the world of finance, some of them like himself of foreign origin, the president is nonetheless a devoted ambassador for the Principality, which he considers to be attractive for business. He defends his conviction during his business trips. 'All too often the people whom I meet think only of the Principality of Monaco in clichéd terms - little is known about the economic situation of the country. We stress that private equity can improve business prospects and create expansion and jobs. This is the main message which MVCA tries to communicate. Some of our foreign stakeholders first need to be convinced that actively participating in a conference in Monaco will not have a negative impact on their image. They are unaware that there is real economic life here.’ To support this position, the number of contacts and offers of joint working has increased: The Chambre de Développement Economique, the Junior Chambers of Commerce, the Direction du Tourism et des Congrès, the Fédération Patronale, and the International University of Monaco. 'I also want to present a good image of the country I have lived in for the past ten years. The organisation works essentially like a club, but skills sharing is part of MVCA's philosophy.' What is the target audience for private equity? African and Middle Eastern countries, as well as Russia, are developing faster than other countries and present great opportunities. MVCA is often contacted by foreign entrepreneurs and Monegasque companies who are looking for funding. For investors, it is often easier to control a company if they hold the majority share. The practice itself has sometimes a poor reputation. There is no question of hoping for an immediate profit: you have to learn to be patient and wait at least five years before the sums invested bear fruit. Convinced of its value, the president refutes ready-made ideas about private equity. He claims that those who have become involved obviously want to make money, but that recent trends push them to adapt their companies to new market information, even if this means temporarily being less demanding in terms of revenue generated. An international-scale study conducted before the economic crisis proved that companies who benefited from private equity funds grew more rapidly than others.
Providing advice and investment
MVCA essentially offers advice on investment and presenting investment projects. The organisation also focusses on young entrepreneurs wanting to set up their companies in Monaco. MVCA organised a lecture by the millionaire Henry Kravis, founder of Kohlberg Kravis Roberts & Co. Other such lectures are planned for 2013. To promote Monaco's image, the MVCA has drafted summary documents about the Principality's economy and participates in conferences about the Principality. It regularly invites international specialists to encourage discussion. With eight members, the Executive Board includes, alongside Zsolt Lavotha, two vice-presidents Guy-Thomas Levy Soussan and Stephane Garino as well as Nathalie Tanzi, Sabine Holz-Strautmann, Oliver-Tim Rott and Pravin Khatau. The 70 Members of MVCA are individuals from the finance sector and experienced international entrepreneurs. Before being admitted, candidates are hand-selected.
Monaco Private Equity and Venture Capital Association
3, avenue de la Costa – 98 000 Monaco
Tel. +377 97 77 03 33
Fax + 377 93 50 32 26
www.mvca.asso.mc
