Sovereign Funds Spent Another Year Hunting for Payment Fintech Plays
Global sovereign wealth funds are taking up larger stakes in the booming financial technology industry. According to the SWFI transaction database, sovereign funds like Singapore’s Temasek Holdings have been tepidly shifting out of Western banks in favor for companies like Mastercard and smaller fintech plays like Eigen Technologies, which is a London-based artificial intelligence (AI) technology platform that reads legal and financial documents. While valuations are high, confidence in the long term potential of some tech companies is strong enough to overcome the cost burden. Sovereign wealth fund managers don’t seem to mind paying a premium for a company that is likely to prosper. Saudi Arabia’s Public Investment Fund (PIF) funneled big money to the ginormous SoftBank Vision Fund which aims to target at least US$ 200 million toward financial technologies. Ibrahim Ajami, Head of Venture Capital at Abu Dhabi’s Mubadala Investment Company, opened an office in San Francisco. Mubadala perceives venture investing as a collaborative endeavor.
Fintech Payments Ecosystem
Proximity to the Silicon Valley is seen as the best way to be a part of the conversation, and to make prudent financial decisions. Payments processor Worldpay is one such investment. Worldpay processes a variety of payments online. Over 300 payment types are accepted, and Worldpay notes that US$ 40 billion in transactions pass through their systems each year. This includes payments in 146 countries. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
U.S. Public Becomes More Aware that Gmail Scans Emails
Alphabet is a major stock holding for sovereign wealth funds and large pensions. Search giant Google is under fire for allowing third-party partners and companies, like Return Path Inc and other advertisers, to share data from Gmail accounts. Many experts and tech observers already knew this, but more people in the public are becoming aware of Google’s practices when it comes to privacy. Google disclosed in a letter to U.S. lawmakers this finding. The Wall Street Journal reported that in some instances, app companies were able to read people’s emails in order to improve their algorithms. In 2017, Google said they would stop scanning all of one’s Gmail messages for the goal of personalized ads.
GPIF Infrastructure Exposure Almost Reached 200 Billion Yen in March 2018
Japan Government Pension Investment Fund’s (GPIF) exposure to infrastructure real estate was 196.8 billion JPY at the end of March 2018. At that period, 57% of the exposure was to the UK, 15% was to Australia, 15% to Sweden, 10% to Spain and 3% to Finland. 21% of GPIF’s infrastructure portfolio was linked to airports versus 27% to ports.
AIMCo-backed sPower Closes $498.7 Million Bond Deal
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The Government of Iceland is looking to possibly form a sovereign wealth fund to stabilize the country from unforeseen shocks to the national economy. The Iceland government released a statement saying, “The state’s contributions to the Fund will be equivalent to new revenues from publicly owned power production companies which are expected to accrue in the coming years.”
Japan Government Pension Investment Fund (GPIF) awarded its first global real estate mandate by hiring CBRE Global Investment Partners Limited. This is a global core real estate fund-of-funds separate account. Overseeing this mandate as a gatekeeper is Asset Management One Co., Ltd., which is a unit of Mizuho Financial Group. This RFP was launched in April 2017.
CBRE Global Investment Partners is the multi-manager arm of CBRE Global Investors.
In addition, on August 8, 2018, GPIF hired two custodians for short-term investments. These custodians are Trust & Custody Services Bank, Ltd and The Master Trust Bank of Japan, Ltd.
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