Stephane Pesch (LPEA): The new face of PE
With PE and VC thriving in Luxembourg, Stephane Pesch, CEO of the Luxembourg Private Equity and Venture Capital Association, explains how the LPEA has become a valuable forum for practitioners to share their ideas, views with their peers as well as with the Luxembourg government and public institutions.
Can you describe your association in a few words?
The LPEA was created in 2010 by visionaries who anticipated that alternative investments, including private equity (PE) and venture capital (VC) strategies, would represent the next big success for the Luxembourg investment funds’ hub. The LPEA’s 338 members comprise three categories: Full members, who are General Partners (GPs), Limited Partners (LPs) and family offices. Secondly, Associate members, who include service providers and advisors such as depositary banks, AIFMs, fund administrators, audit and law firms, tax experts and consultants. Finally, the Affiliate members are represented by non-executive directors with PE mandates, entrepreneurs and founders of innovative companies and independent PE specialists.
“Democratization of PE will facilitate and enable new stakeholders to access the private asset classes”
What is your mission as an association?
The main goal of our association is to represent, defend and promote the interest of our members and the PE/VC industries. The first mission of the LPEA encompasses public affairs and advocacy hand in hand with the representatives of other financial associations, with whom we discuss the latest directives and regulatory changes in order to share our common views with the authorities and some public entities. Our second mission is thought leadership. Alongside our annual flagship conference, the LPEA Insights, we have launched more than 25 technical committees and clubs - composed of LPEA members and industry experts – which tackle the latest trends and developments. The topics range from legal to tax and also include operational matters, focusing on different investment strategies as well as analyse the latest ESG developments. Our third mission is talent attraction. Over the past two years, we have developed a specialized training academy and have organized two dedicated job fairs. We also opened an HR club where practitioners discuss their needs and the hottest profiles.
What major trends do you see emerging in private equity?
The most recent trends englobe the broader acceptance of technological innovation and the “democratization” of PE which enables new stakeholders to access private asset classes via specific products, vehicles or platforms, next to the traditional institutional and professional investors. Nowadays new players also include more family offices (many were already active in the field) Private bankers, Wealth Managers and insurancers who have strongly increased their share in private assets over the recent years due to a high demand from their clients. Digital platforms and innovators are offering tech-based solutions which for example facilitate the on-boarding of clients, help identify promising opportunities thanks to AI-driven tools, optimise the reporting and administrative deliverables, make the whole industry more data-driven or accessible (via APIs) and also automate the operational workflows. “Off the shelf” structures allow a quite personalised experience and exposure to PE/VC, which in certain cases, can even be extended to more “retail” types of clients. The refurbishment of the European long-term investment fund (ELTIF) structure is also happening right now and could represent a very interesting catalyst, solution to cope with this increased appetite. Luxembourg start-ups with their inspired technologies have also been sprouting for some time now and have successfully rolled out their products, further proof that Luxembourg is further strengthening its position as an innovative ecosystem and a more transversal PE/VC hub which proposes efficient structuring solutions, the right entrepreneurial mind-set and new opportunities.