Private Investing Could Change Forever With AI | Saad Hassan of Nvestiv
All right. Hi everybody. This is just Na Myers here from raises.com, where it’s our mission to democratize investment banking. So welcome to this episode of the podcast where I’m with, with, uh, sad Hassan, who is with Investive and Sad Hassan brings a big wealth of, you know, experience of expertise in leading the market when it comes to raising capital for a variety of c.
And he’s been an envir, invaluable resource to startups, companies, and all types of entities that are seeking to raise capital all across the world. And it’s with my great pleasure that I introduced SA Hassan from Investive. Thanks, NA. No, no worries. No worries. Um, and offline, we’re just, we’re just talking about, you know, just some of the experiences. (ai investing)
You know, that, that sad had with, you know, running and growing his company and assisting a lot of people in just organizing their companies and raising capital. So the first question that we usually like to ask is, everybody has a story. So when it comes to you and investive, what is your story side?
Thanks for having me, Nancy. Um, Investive, uh, is. It’s, it’s a marketplace, but it started with my work with investment banking in the past, right? So I, I worked as an investment banker, then I worked for a large conference company where, you know, I was heading up their investor relations team and I spent most of my time working with family offices.
Uh, that was my first time in the experience of private capital. Before that, it was all institutional and something that jumped out at me was this private world of alternative investments is very siloed. It doesn’t have a lot of technology and it doesn’t have a lot of connectivity between all those people that are, that are stakeholders in it, right?
Investors, sponsors of deals and funds, and all the brokers in between who are trying to get all this information done. So, It, it’s a very white glove turnkey solution type of industry. Families like to stay private. Information is not readily available. And I spent most of my days sitting in front of an Excel sheet.
Um, that was my day-to-day. Uh, I say this all the time, but I probably spent 16 hours a day working, and of those 16 hours, I would say 12 would be spent in front of an Excel sheet and the rest would be picking up the phone and, and getting on the phone and calling people. So I thought to. Why isn’t there technology in our industry that that accelerates, that automates a lot of that upfront legwork so that we can spend more of our time doing the things that make us money, which is being on the phone. (ai investing)
So, um, I built investive, uh, with the hope that we can leverage technology and automating a lot of the work that we do. We can create direct relationships between investors and, and those who are seeking investment. And, um, you know, it’s been an interesting journey so far. Yeah, definitely. Interesting. And as we were talking a bit offline, because, um, you know, a lot of times when, when a lot of high performing founders, especially in the you, you know, in the financial services and, and capital markets niche, you know, as they start, there are a lot of things that they see emerge, um, you know, after that inception of their company and when the company, you know, matures like investive has at this point.
So what’s is one thing you would say that you’re, you know, that invest. Um, did, uh, that you didn’t expect, or what is one occurrence that happened that you didn’t expect? You know, as you know, you’ve matured and grown the platform. It’s funny that you say that because that actually is a case for all startups and not just startups, but with every business.
You set out to think that you’re going to do something and then you end up doing something entirely different. And that’s because you don’t decide what your company is. The market tells you what you are, and it’s something that most founders find. Find out the hard way later on. So we started out because we wanted to be a marketplace for investors. (ai investing)
To source deals and for deals to find investors very quickly we turned into something completely different. Um, still kept that, but we had to pivot to cover other aspects the most, you know, interesting. One of those that, that I didn’t expect was the, the inclusion of brokers and intermediaries into our system.
Um, I told you the story in the past where I, I really thought that I was going to cut out placement agents and brokers and essentially get rid of the middle. In the capital raising process. That was the entire purpose of what we were going to do. And, you know, by accident, I pitched, uh, a placement agent one time.
I didn’t know who he was, and he ended up very quietly listening to what I was saying. And he said to me, Hey, listen, um, I’m a placement agent. Sorry, I, you know, didn’t mean to deceive you, but I wanted to hear what you had to say because I wanted to understand what you have. But if you don’t mind me telling you, You’re an idiot. (ai investing)
That’s, that’s exactly what he said to me. And I, and I said, well, hold on. So what do you mean? And he said, The people who would pay the most for what you’ve built are not the sponsors and not the investors, it’s the brokers who are doing this on a daily basis, right? We are the, the brokers who get hired on behalf of sponsors to do this work.
The sponsors go about their business because they’ve hired us to raise capital for them. We are the ones who do all the legwork in this industry to get these deals. We’re the ones who spend hours pouring over, you know, Excel sheets. So why don’t you let us use it? Not only will we benefit from it and help us grow our businesses, but we will end up being the, the army that gets deals done on your platform.
And I, and I agreed with him. So we, we pivoted and, and now our system is totally different. Now, when clients come to work with us, we actually dedicate, um, and, and assign a broker to them. Um, From part of our overall group, and, um, they’re the ones who end up going and closing deals for us. On top of that, the brokers actually bring us a lot of deal flow and a lot of relationships.
Yeah. That, that’s, that’s hilarious how that turned out and it became your great, one of the greatest assets, and it almost ties into the next points, but. So imagine, so imagine you have a, you know, a new, you know, potential, you know, potential person that wants to work with investive, um, or even one of the other, you know, whatever you broker dealer or what have you.
What is really a really common myth or misconception, you know, in, in this area of expertise that’s, you know, a lot of people, you know, wrongly believe investment banking is not the wolf of Wall Street. That’s, that’s the most common thing you can, you can say to them, people come in with investment banking.
What they, what they think that, you know, this is the life. Um, maybe it is in some places, but the reality is you spend a lot of time staring at your computer. Um, as I said, it’s a lot of research. It’s a lot of. Marrying, you know, buyers and sellers in your head. It’s a lot of preparing, deal documentation and all of those things. (ai investing)
Uh, the, the work of being a, being an investment banker is more closely related to the work of being a corporate lawyer than it is. Um, you know, anything else. Um, there is the aspect of sales and, and deal closing, but that probably is only 20% of the first, uh, amount of work. I couldn’t agree more. Like that’s exactly what one of the things I was thinking of, thinking of a few different things, but that’s one of them.
Um, so. Like looking. So it, it’s interesting because investive is really, it seems to be a software, um, innovation, uh, at, its at the heart of it. Uh, so based on some of the innovations that you know, you’ve built and what you’re seeing, where do you think Kepler raising will be in the next 15 years? And what is the vision for where your company will be, uh, at that time?
That’s an interesting question. Um, We have our thesis. Um, so here, I’ll tell you what I believe. Capital raising as it is now, is a consultative industry. It’s a matter of who you know and who you don’t know. So if you know somebody that will connect you to capital, then you’ll find the capital that you need.
If you don’t know anybody, then you’re at a severe disadvantage. Um, there have been many platforms in the past who have tried to, you know, put this matchmaking system online in the past and they’ve all failed. Um, There’s a very specific reason why it was because those who are tech savvy build platforms without understanding the mindset and the temperature of, of the people involved.
Um, you have to have really worked in this industry to understand that family offices, they’re, they’re private. Individual investors are private institutions. They have a, a due diligence requirement and governance with their boards and shareholders, and therefore they need to keep their information private. (ai investing)
They don’t like it when their information is on, on blast on the internet, so companies like PitchBook and Preco and databases out there. They’re detested by all investors because it’s simply a way for, you know, their information to be blasted out to everybody, just for anybody who’s willing to pay for it.
Take a family office for example. This is, this is direct words from what they’ve said. A family office hates PitchBook and frequent because it makes them targets. Um, it makes them targets to unsolicited, you know, requests of capital. That’s one, but that’s not even the worst part. If you are somebody who is, you know, looking to scam and fraud, guess what? (ai investing)
You’re gonna go on PitchBook and frequent and find out who the wealthiest people in the world are. If you have criminal intent, you’re gonna find out who the wealthiest people in the world are, right? So, Those who have money, they, they want to keep their wealth private and they wanna be able to interact and transact privately.
And so they hate those types of systems. But we’re also headed towards a world of, of digitization. So I think where, to go back to your original question, where I think the, the world will change is we are seeing now a eutification of, of, of investors all over the. The baby boomers are now retiring. There is a large generational transfer of wealth happening all over the world, largest in the history of our world, and the gatekeepers and the, and the those that are steering the ships of, of these investment organizations are now getting younger.
Those people are not content with this white glove, you know, under the table type of dealing. They’re interested in proficiency, they’re interested in ef. And they want digital means of finding investments. So how do you solve the first problem, which is privacy issues with the problem of trying to efficiently find capital and and source capital?
So that’s really been our focus, and I think that’s where we are trying to really build our inroads. Um, the way we’ve built our system is completely dedicated to privacy. We, we almost do it much like a social network where there has to be a mutual due diligence and a connection before any information is shared. (ai investing)
And I think that we’ll start to see a lot of platforms like this pop up here and there, but I think we have first movers advantage, uh, in a, in a, in a wild sort of, uh, magnitude. And I. That in the next three to four years, ecosystems of investment will be the, the way of capital raising in the future. JP Morgan, Morgan Stanley, investment banks are already doing this.
They have systems, even BlackRock has a system called Aladdin, where um, they use Aladdin to essentially qualify deal flow that fits into their criteria. So this will be the way of the world, I think, going forward, as long as those that are doing this are completely committed to the privacy of their individual.
Yeah. And fascinating because it almost seemed as if that would contradict one another. But it looks like, I mean, invest is, is solving the problem for both in this time. So, I mean, um, we’re challenges, but yes, we’re, we’re trying. Yeah. Um, there’s only, you know, there’s, there are conflicting issues as you said.
You know, privacy requires slowing down transactions and, and making sure that the right people are interacting with each other. But the whole idea of digi digitization is to scale, right? So then you now face opposing ideas and, and to be able to navigate and traverse that as a founder is really the, the main challenge.
Oh yeah, a hundred percent. And, um, And because even, even you just walking through this and talking to a family office directly and listening to what they actually told you from their mouth as opposed to assuming what people wants. Uh, you know, you actually focus on giving people what they want. So I guess if you were to combine a lot of the experiences that you had in actually assisted in a lot of, you know, these companies to get to where they want to be, um, what is one thing that you’d say that you learned through the experience?
Um, or I guess like an important lesson, uh, that you’ve learned as an owner operator and as somebody who is actually in the thick of it, seeing these deals get closed and just seeing everything that happens behind the. Well, you’re a broker. You would know this. Right? Relationships is key. Yeah, exactly. (ai investing)
Relationships above all things is key. Um, you’re building out your business and you’ll, I’m sure you’ve learned this already, that sometimes you have to sacrifice a tr the, the transaction for the sake of a relationship. And sometimes you have to be able to let go of instantaneous gain for, for the idea of, of long-term, you know, uh, prosperity.
And that’s something that’s hard to do in the beginning, because in the beginning you’re, you’re, you’re focused on earning revenue, you’re focused on getting what you can and, and building what you need to build. But I think founders make this mistake from the very beginning. And, and it’s something that I’ve made the mistake early on and I’ve learned to correct that, which is, There’s nothing that comes above the value of a relationship, especially a relationship that brings strategic value.
Um, sometimes it’s okay to give in order to get in the future, and the more you give, the more you’ll get back. Hmm. That’s the most eloquent explanation too, almost reminds me of the prisoner’s dilemma. Uh, something from game theory. You know, he is always thinking about the what is best for everybody and what are the, the biggest long-term gains, rather than just being greedy and following that greedy algorithm, so to speak.
Well, it’s hard to responsibility to your staff. Your responsibility is to your organization. You have shareholders. So you have to present short-term or, uh, short-term values. Take the c e o or the managing partner of any, any fund. They need to show immediate returns to their LP investors or their shareholders or whatever the case is. (ai investing)
Um, so they need to, to act now and to be able to show track record, but then, Sometimes a decision that they make now will destroy the prospects of their future raises going forward. So you need to have that long term vision as opposed to just, uh, whatever’s going on at that moment in time. Yeah. Good points.
So it’s not, it’s really both and just keeping the short term manual long term in play, not kind of removing one for the other all the time. Yes. So, Like I, I’m hearing obviously there’s been a lot of introspection because I mean, as somebody successfully, uh, build a platform in this, in this industry, um, I think it takes a lot of, um, it, it takes a lot and, you know, you’ve probably seen different characters in everything.
So I mean, Based on some of the people in like, let’s look at the people, some of the people you potentially work with, the people that actually succeed and the people that you know are even, are even ready for this type of work of raising capital of, or the people who are even allocating capital. What will you say is like a, a personality traits or a set of traits?
That, uh, are more prevalent in this industry when it comes to people that actually successfully, you know, work through the finish When it comes to closing a transaction, what are the personality traits that you see, uh, are the most common For those that are in our position, which is to, to facilitate the transactions, or are you referring to the investors or the sponsor? (ai investing)
I’d say the sponsors for, for one, because number one, the sponsors are probably the people watching this video and the ones who are most eager. Um, and then just as a general owner operator, uh, because many of the people who are sponsors are also owner operators. So I, I think if you can hit it from both angles, you’ll probably help out a lot of the viewers.
Sure. In my experience, the sponsors are terrible salespeople. Um, and I say this with all the respect because I understand where the sponsors are coming from, right? The sponsors, let’s just say they’re a deal that is looking to raise money for their company. The reality is they’re probably, you know, good at something else that made them successful in how they built their own business.
Maybe they’re an engineer, maybe they’re, you know, uh, a technical expert on something else. That is what gave them success in their company, and now they’re looking to raise capital, but that doesn’t necessarily mean that they, they’re good in sales. Sales is a very different set of personality skills or take a, take a fund.
For example, a real estate fund who’s raising a hundred million is doing so because they have access to wonderful pipeline and pipe, uh, of deals and assets. That financial literacy does not always come with sales acumen. Raising capital is sales. Above all things, it’s sales. You have to be able to sell yourself, sell your idea, and sell your future. (ai investing)
So what I would say is the most important thing that I noticed about sponsors is Danny to learn to sell better. Um, and there are different ways of going about it. Um, Personality is, is important. You need to be able to, to compose yourself, uh, as somebody who is in control of your situation. One thing I always see is that sponsors, and even brokers, like myself included, I’ve done this in the past where when we’re speaking with investors, we treat them with the type of reverence that actually kills deals.
Do you agree? Yeah. I was on mute. Exactly. Um, we were just talking about this offline, like, and for reasons that you wanna get into, I. You know, it repels, it repels people like crazy because it shows that you need them, right? Yes. And, and investors know that you need them, but you also have to remember that investors need you.
Because investors the worst thing they want and, and the biggest challenge that they’re battling is inflation. They don’t want their money sitting around in a bank account. They need it, you know, put to work. So they have challenges just like you, just like you need the capital to, to further your strategy. (ai investing)
Investors need you to further their capital, so there is a mutual need for each other. And instead of reving investors, as if they’re somebody who’s above you. It’s very important to make that change in mindset. And remember that investors need you as well. You are there to qualify, fit, uh, as to who is the right investor for you at the same time that the investor is trying to qualify fit as to who is the good sponsor for them.
And if you can treat investors like an equal, like a human being, not just a checkbook or, or a wallet, um, you will find that you have a lot more traction with investors, and investors will openly do business with you because, They respect people who deserve and demand respect for themselves. Hmm. Oh, interesting perspective.
And, um, so I mean, it links, it links into. Some of the most important things anyone could ever need as advice because, um, I, I was also going to even bring up the fact, hey, somebody who is getting into this type of work, who are, who is looking to start out in raising capital and who may even be a potential good fit for investive.com?
Um, I was gonna ask, what was the biggest piece of advice? So, I mean, would it be just focus on sales and if so, are there any tactics, uh, that you would recommend or is it something else that you would recommend as the number one piece of advice, uh, for people starting out in raised capital? I feel that I got to where I am today because of my ability to, to sell as nothing to do with anything else. (ai investing)
Uh, um. I have a bit of a technical background in terms of, uh, of, you know, how I approach problems. I, I like to apply, you know what I know. I would just say that in order to be successful in our industry, you know, sales is one thing, but sales can be taught. But sales, I think, gets a bad rep. Um, there, there’s this saying that everybody says, which is when you’re describing a good salesperson, they say, this man can sell, you know, ice to an Eskimo, right?
It’s meant as a compliment, but I think it’s the worst thing that you can possibly say about a person, right? Being able to sell ice to an, to an Eskimo just infers that you are looking to sell somebody something that they don’t need. Sales has turned into a bad sort of definition because of the fact that people don’t like salespeople.
Um, whenever you’re around a salesperson, you, you get, you know, agitated or, or, or you get nervous because people. It’s human behavior. They want to be able to control their own choices and, and they feel that salespeople are ingenuine and trying to give them things that they don’t need. In reality, sales is about understanding fit. (ai investing)
I use that word all the time. It’s about understanding fit and being able to explain value. Um, Where that isn’t so obvious, and that’s what I refer to when I say sales. But outside of that, what I would also say is it’s very important for somebody who wants to be successful in this industry, to be curious and to be able to love soaking in new information. (ai investing)
Um, my friends actually say this one thing about me, which I think is, is really the key to my, my prowess in anything is that. I’m a walking encyclopedia of useless information. It’s always been like that. I mean, there are things in my head that are related to so many different subjects, you know, from science to math, to to, to languages, to history, to to world p, world issues.
And, you know, I’m not a master of anything, but I feel like. I’m a bit of a jack of all traits and, and the reason why that’s important is because investments is all about that. Today we’re gonna be speaking with somebody who is in real estate. The next day we’re gonna be speaking with somebody who has an interesting engineering concept.
Um, somebody who has a pharma or a biomedical advance to be able to understand at the very base level what they’re talking. Um, and to be able to apply that to how it, you know, fits in with other things in your ecosystem or the world ecosystem or to the ecosystem of your investors that you’re bringing into. (ai investing)
That level of knowledge doesn’t come by learning. It comes, or, or anything that I can teach you. It comes from your own curiosity of the world and then the world around you. So those that I’ve seen are the most successful people are those that are just. Eager and, and open to new information, even if they don’t, you know, feel that it doesn’t, it doesn’t benefit them right away.
Um, I’ve learned things and applied things this week that I’ve learned probably 10, 20 years ago. Hmm. And like, I mean, I, I agree. When, when, especially when you talk about things that are off like finance, because I mean, look at, I mean the, the, the classics, right? Like, uh, Charlie Munger, Warren Buffett’s, uh, business partner.
I mean, he, like, he knows, he knows that every, almost every, like, I mean you’re talking about engineering principles, you know, biology, physics, and especially some of the principles that go on longer than some of, a lot of the human made ideas because those principles seem to be true, uh, over the longest period of time. (ai investing)
And so a lot of them, they seem to just like a p, apply those principles to, um, To things that we like business, for example, throughputs marketing is just getting people through a funnel, you know, things like that. So, couldn’t agree more. I mean, you should see my YouTube suggestions, right? That’s, yeah. I feel like YouTube suggestion is a good indication of a person’s real, real personality because, If you were to see the categories that show up on my YouTube suggestions, it’s a little bit of everything.
Um, starting from sports all the way towards, you know, weird conspiracy theories and, and science and, and world issues and geopolitics and I mean, you would think that there, there’s, you know, multiple people, um, using my YouTube account, the reality is it’s just me because. Anything that’s interesting or anything that I don’t know, I’m interested to see and, and soak it up.
And I think that when I hire people, um, I don’t test them on their knowledge of this industry because that can be taught. Hmm. I’m more interested in how curious they are. Um, Of the world around them, of human behavior of, of how people interact with each other and how entities interact with each other.
If they, if they show that burning desire for knowledge, that to me, is the most attractive quality for anybody who I would hire and I think would be successful in this industry. Yeah, here, here. I mean, there came a point, even me personally, I mean, uh, without me knowing about, being curious about crypto and, and getting into that, I, once I’ve been into investment in banking, so, um, maybe, maybe, maybe if you’re curious about capital raising, maybe you should take action and maybe, who knows, maybe you’ll be one of invest best, uh, one of their best clients if you’re watching this. (ai investing)
So, uh, I mean, looking at, just looking at all the people watching. Uh, anyone who’s curious to hear more, like, uh, where would somebody who is interested in how Investive works, how would they actually get in touch with you or your company to actually, you know, benefit from some of these, um, services? Let’s say if somebody wants to raise some capital, what would they do to get in touch with investive?
So if you’re looking to raise capital, um, you can go to investive.com. Um, our system is free to create an account. Uh, there is a login portal@investive.com. What you can do is create an account, create a profile. If you’re looking to raise capital, specify a project that where we ask you a structured questionnaire.
You don’t have to pay or anything like that. What that does is it puts your information in our system and it. Cross references with all of the investors’ demands and mandates that we have in our system. It tells us before you even get on a call with us, whether there is a fit, um, with the level of demand that we have in our system, or if we can’t help you because we just don’t seem to have people that are interested in your strategy.
If there is a fit, then a member of our team will reach. I’m not so involved and invested these days anymore. I’m more in, more involved with our family office. But there are others in our team who are responsible for manager selection process, and they will get in touch with you. They’ll let you know what type of demand we have. (ai investing)
Sometimes they’ll tell you we don’t have enough and, and, and apologize and point you to the right direction of somebody else that might be able to help you. But the idea is that we’re very demand focused, not supply focused. We would rather start from the pockets of demand that we have from our investors and, um, Only bring on those clients that we believe would be a very, very strong, um, fit for the appetites of our investors.
Perfect. And and that is N V E S T iv.com for those who are just listing on audio. That’s right. So, exactly. So how about the, so the broker dealers and so I mean the broker dealers and the asset allocators as well. Uh, would it be through a similar process? Yep. Exact same process. Uh, allocators are, are the easiest. (ai investing)
Um, we do go through some checks to make sure that you are, who you would say you are as, as our res, our responsibility and due diligence. So sometimes we require you to upload information, um, to make sure that you’re an accredited investor or a sophisticated investor. Um, and for broker dealers, we speak with you directly just to understand what your priorities are.
Uh, now if you. Looking to be somebody who gets deal flow from us. Um, we will have that conversation. If you are looking to bring deal flow to us, um, that’s a different conversation and we work with you in, in, in unique ways to make sure that the alignment is there to make sure that rubber dealers make money as well as, um, investive perfect. (ai investing)
And so with all of that, I mean. You know, sad, I really enjoyed the conversation and hey, it is not that often that you actually speak to founders who actually understand the, you know, they’re not, they don’t think in black and whites, they actually understand that, hey, there are levels to this. And then they’re like, there’re different gradients to capital raising.
There’s tech, there’s systems there. Process. They’re misconceptions and it’s not really just, hey, you know, begging an investor for, you know, for like a miracle to happen. So I guess as we close, like is there anything else that you want to, you know, share to the audience? Any, I guess maybe tips, insights, or things that they should do? (ai investing)
Any, anything at all, especially in this, uh, time that we’re in? No, I mean, look, I think, I think the important thing to realize is that, We make mistakes as we build things and those mistakes teach us lessons, right? Um, I’ve made my share of mistakes. I’ve had blunders, I’ve pissed off clients. But the important thing is I’ve done everything I can to go forward and make up for those and see how we can add value.
And those clients of ours who, you know, we’ve made mistakes with, are now our biggest supporters because we’ve. We’ve admitted to our mistakes and we’ve said, listen, I need your help in fixing the issue. And I think that’s the important thing. As, as you know, people of this industry, we are managing so many clients and sometimes they have expectations and we’re never gonna meet them. (ai investing)
So it’s not that we’re always gonna have a hundred percent, you know, um, score with them, but it’s a matter of being able to say, let’s work together. In figuring out what you need as opposed to us always having to know what you need. I think that’s the biggest and most important thing. And I love the fact that, you know, you along with other companies in our industry are finding ways to innovate in, in the space that is so archaic.
Right. Very, I, I love what you guys are doing. I, I, I’m trying to do the same thing. Uh, there are a few other guys who are trying to do good work, um, and I think that eventually with a collective. We’re going to change the mindsets of the people in this industry who are resistant to technology and, and help them understand that this is far better way of doing business. (ai investing)
Every other industry has embraced it, just not this one. Absolutely. And, and in fairness, and based on some of the things I’ve seen, I mean, Hey, uh, in the line of the dinosaurs, it just takes two wheels to look like you’re NASA or something, you know, but, but, uh, that being said, hey, it’s always, it’s always a pleasure talking to you and, uh, learn a lot from you as well.
So, here, here, this is, uh, Saan, invest of everybody. Thank you for, for tuning in today. Thanks for having me. No worries. Cheers. (ai investing)