The superpower of specialism

Lindsey McMurray, Managing Partner at Pollen Street Capital and upcoming speaker at SuperReturn International 2022, highlights the megatrends impacting financial services and the superpower of specialism. Read on to learn about the strategies of Pollen Street Capital and critical role financial services have to play in driving positive impact in a tangible way for the real economy.

Pollen Street is a financial and business services specialist, and we believe that our specialism is both a differentiator and driver of performance. We created Pollen Street to champion and nurture businesses positioned to benefit from the huge structural changes taking place in the financial services industry. Across both our Private Equity and Credit strategies we see the impact of a set of megatrends in financial services:

1. New technologies driving disruptive business models

2. Significant SME financing whitespace

3. Financing the green transition

Ultimately, we believe that our dedication to investing in financial and business services across the capital structure is one of the key factors for us to be able to deliver strong returns within a very contained risk profile. The expertise – the founding partners and I have been working together for over 16 years – and relationships within our business mean that we can capitalise on a number of key things:

• differentiated deal sourcing driven by our network
• bespoke deal structuring
• best-practice sharing across our portfolio
• business development and sharing of common opportunities
• risk mitigation through multi-cycle sector experience

We have been focused on the Financial and Business Services sector since 2008. Our sector specialism means that all our years of experience generate a deep understanding of the megatrends mentioned above and their impact on the businesses we work with.

Powered by purpose

Our specialism in financial services also informs, and is a product of, our overarching purpose. We believe in the critical role that financial services has to play in driving positive impact in a tangible way for the real economy. It is through this lens that we assess our investment opportunities; to build better businesses, to improve access to finance and the help decarbonise the economy and support the environment.

Our purpose is to deliver long-term sustainable performance by enabling society through frictionless financial services. Through our investments in financial services we can drive change, whether that be by funding green alternatives for homes and transport, accelerating financial inclusion through investing in purpose-led banks and lenders or even driving regional economic growth by investing in businesses and real estate developers across the UK and Europe that reduce regional disparities.

Framework informed by clear focus

At Pollen Street our specialism means that we are focused on sectors that are enjoying strong growth and structural change. The megatrends we see are driving huge opportunity in a space where we have deep understanding – with those foundations in place why wouldn’t you specialise?

In financial and business services, structural change is accelerating. Technological innovation and changing consumer behaviours are creating opportunities to build leading businesses that serve well-defined target markets and combine excellent customer service with modern delivery methods.

Large incumbent players, encouraged by shareholders, regulators, and their own boards, are simplifying their business models. Customers are demanding more and better products and services as they see improved service and delivery across other sectors. Data and technology are enabling those nimble, fleet of foot businesses to deliver high quality products and services to businesses or individuals with better service and price.

Consumers are increasingly focused on their environmental impact and looking to make real-life changes. Finance is an essential component of this side of the green transition, supporting EV Financing/Mobility and the shift to renewable energy and green housing.

This is where we focus our energy – dynamic businesses that have the agility and customer loyalty to anticipate and meet change. A specialist focus allows us to develop a truly effective systematic framework to deliver growth in this space through:

• Digital transformation and adoption
• Product development
• International expansion
• Bolt-on acquisitions
• Business development via the Pollen Street Capital network

The power of the network: Pollen Street Capital Hub

In Pollen Street we have formalised and resourced the idea of powerful networks, through our Hub. The Pollen Street Capital Hub is a dedicated team with capabilities in data, AI, tech and impact implementing a systematic approach to drive growth, technology development, sales performance and collaboration across the portfolio.

Although our portfolio businesses operate in different areas, because of our sector specialism there are strong common themes; digital transformation and digital marketing, data analytics, cloud implementation, excelling in the regulatory sphere and ESG.

Since launching in 2018, we’ve created multiple Hub initiatives addressing portfolio-wide issues through workshops and network events where we can share common opportunities as well as operational expertise. Leaders and teams across our portfolio connect regularly to share their specialist knowledge, all facilitated by sector-specialist experts in our Hub team.

In times of abundant capital, deep sector relationships and domain expertise are key differentiators that can attract top founders and leaders in our industry. The specialist strategic support we then offer drives performance for our portfolio companies and returns for our investors.

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Under the spotlight: Lindsey McMurray

Lindsey McMurray founded Pollen Street in 2013 and is the Managing Partner as well as Chairman of the investment committee. Lindsey McMurray has been a private equity investor for 25 years with a particular focus on the Financial Services sector. Before she founded Pollen Street, Lindsey led the team managing the £1.1bn Special Opportunities Fund within RBS and spent six years as a Partner at Cabot Square Capital, focusing on operating investments in real estate and other asset backed investments, together with investments in the Financial Services sector.

To hear more insights from Lindsey McMurray and other industry leaders, join us at SuperReturn International 2022 >>