Interview with François Pictet

At a time of perhaps unexpected turbulence, at least to some extent, François Pictet called for caution, inviting clients not to lose sight of the real long-term objectives and to continue to pursue them through active strategies in the construction of their portfolios. ‘We are living in a more volatile, uncertain and unpredictable world’, explained the managing partner of the Pictet Group, an independent investment firm. ‘It is therefore essential to favour this kind of approach, as it focuses on sectors that are likely to benefit from long-term trends and identifies companies that generate value over time.’

His attention is particularly focused on high-end clients, those with large amounts assets to manage, generally associated with the private segment. For them, a fundamental component of the portfolio is represented by private markets that are reacting in their own way to the growing uncertainty and insecurity of the geopolitical situation. ‘In recent years we have seen a decrease in liquidity events, IPOs, transactions and valuations as well’, François Pictet said, while emphasising that private assets remain a good investment opportunity, especially in light of the current state of uncertainty.

‘For the time being, valuations have not moved too much on private equity,’ he explained, before clarifying an essential element and pointing out that, in this case, ‘investments require patient capital and a long-term perspective that an unlisted company like ours is able to maintain without coming under pressure, either in terms of business management or asset management.’ Another fundamental aspect of the approach is sharing the same objectives as one’s clients. The Swiss company pursues these objectives by choosing the right partners and above all by acting as an investor rather than a distributor: ‘By only recommending funds in which we invest ourselves, we can ensure alignment with clients’ interests’, François Pictet assured, ‘as well as building stronger and more predictable companies.’

Italy - which is the second most important market for the Pictet Group after Switzerland, and where the Wealth Management division has been led by Alessandra Losito as Country Head since 2021, - presents its own peculiarities. ‘As far as liquidity events are concerned, the market has slowed down, but to a lesser extent than in other countries’, François Pictet explained, attributing the different dynamics largely to the family structure that characterises our economy. ‘Many companies’, he explained, ‘are going through generational transitions, or they need to scale up in order to compete internationally. To achieve these goals, they very often rely on external partners such as private equity funds, which are best placed to support SMEs and entrepreneurs in a period of discontinuity.’

Among other things, dynamism has helped to partially reduce the valuation gap that has traditionally afflicted Italian companies compared to their French, German or British counterparts.

‘We have also seen a change in cross-border M&A activity, and transaction volumes are now more balanced’, François Pictet acknowledged, and attributed the realignment to the fact that the market felt a sense of greater stability in Italy. This stability is, after all, one of the three pillars on which the Group’s offering to its clients has rested throughout the 25 years it has been active in Italy, along with its innovative approach and the team’s expertise. ‘Our strategy’, he explained, ‘has been to be present and always available to investors, who today have become more savvy. New generations tend to have a higher level of financial education, are better informed and more sophisticated, looking for different and more advanced solutions.’