1 00:00:00,000 --> 00:00:14,000 Welcome back to the Rate of Change with York Wealth Management. As 2 00:00:14,000 --> 00:00:17,340 advices to some of the wealthiest families in the country, the Rate of 3 00:00:17,340 --> 00:00:20,720 Change is a podcast designed to help you in the pursuit of building long term 4 00:00:20,720 --> 00:00:24,160 wealth through the insights of some of the brightest minds in asset management. 5 00:00:24,880 --> 00:00:27,600 I'm your host, Mirroq Gaddi. And in today's Rockcast, we're speaking with 6 00:00:27,600 --> 00:00:32,280 Ian McCowan, the Managing Director of Pinnacle Investment Management Group. 7 00:00:32,680 --> 00:00:37,760 Pinnacle is a growing multi-boutique, which provides their affiliates, non 8 00:00:37,800 --> 00:00:42,160 investment funds, management services, enabling the investment managers to 9 00:00:42,160 --> 00:00:47,360 focus on what they do best. Currently, they oversee $90 billion worth of 10 00:00:47,360 --> 00:00:53,320 FUM across 15 affiliate firms in various asset classes, which provides 11 00:00:53,320 --> 00:00:59,760 investors options across the most market cycles. Along with holding equity 12 00:00:59,800 --> 00:01:03,880 interests in their affiliates, they provide seed funding, global 13 00:01:03,880 --> 00:01:08,160 institutional and retail distribution, and industrial grade middle office and 14 00:01:08,160 --> 00:01:12,720 infrastructure services. For me, I really enjoyed hearing Ian break down 15 00:01:12,720 --> 00:01:17,840 how Pinnacle came to be and why they've chosen to work with specific fund 16 00:01:17,840 --> 00:01:23,440 managers. He unpacks what services they offer to fund managers, how the 17 00:01:23,440 --> 00:01:28,600 business operates, and where new technological advancements such as 18 00:01:28,640 --> 00:01:32,920 artificial intelligence are being used to improve the managed fund services 19 00:01:32,960 --> 00:01:37,600 industry. Before we get into the podcast, I'd also like to encourage you to 20 00:01:37,600 --> 00:01:41,960 listen to the disclaimer at the end of this Rockcast and to keep your feedback 21 00:01:41,960 --> 00:01:49,680 coming. You can reach me at mgatty at ywm.com.au. So with that being said, I 22 00:01:49,680 --> 00:01:53,280 hope you enjoy this conversation as much as I did. So sit back, relax and 23 00:01:53,280 --> 00:01:53,680 enjoy. 24 00:02:04,200 --> 00:02:07,840 Ian McCowan, welcome to the rate of change with York Wealth Management. 25 00:02:09,040 --> 00:02:11,080 Thanks Murdoch. Thanks for having me. 26 00:02:11,080 --> 00:02:15,640 It's really good to have you on in I've been using your funds for a while and 27 00:02:15,640 --> 00:02:19,840 we've had many, you know, guests on from some of the fund managers, you know, 28 00:02:19,840 --> 00:02:24,040 which are underneath your stable. So I think this is gonna be a very 29 00:02:24,040 --> 00:02:27,600 interesting conversation for for us, I'm going to find it very interesting and 30 00:02:27,600 --> 00:02:32,400 for our listeners as well. Yep. So why don't we kick things off. And I always 31 00:02:32,400 --> 00:02:36,280 like to start with learning a bit about yourself. So how did you get into the 32 00:02:36,280 --> 00:02:39,840 world of finance? And do you mind giving us a little bit of an insight into your 33 00:02:39,840 --> 00:02:46,680 formative years? Yeah, absolutely. So I knew from quite an early age, really, 34 00:02:47,160 --> 00:02:54,280 that money and finance and all things financial could make a big difference to 35 00:02:54,280 --> 00:03:01,600 people's lives. And I was really interested in commerce and financial 36 00:03:01,600 --> 00:03:09,000 matters. And so I just knew I wanted to go to university and do commerce. You 37 00:03:09,000 --> 00:03:13,680 know, I think I think you're lucky if you just have this inherent, strong 38 00:03:13,680 --> 00:03:20,040 feeling as to what things interested interest you. And so I was lucky enough 39 00:03:20,040 --> 00:03:25,680 to have that. So I grew up in Rockhampton, actually in central Queensland. 40 00:03:25,680 --> 00:03:33,160 I took a bonded scholarship to do commerce at university that led to 41 00:03:33,160 --> 00:03:39,560 internships and a really good job at Queensland Treasury. So most people are 42 00:03:39,560 --> 00:03:44,520 surprised that I started in the public sector. But that was actually fantastic 43 00:03:44,680 --> 00:03:51,760 training ground. I loved it from the day I started. Because I loved it, I worked 44 00:03:51,760 --> 00:04:00,440 hard, got, you know, rapid promotion. And long story short, I ended up as the 45 00:04:00,440 --> 00:04:06,760 first CEO of Queensland Investment Corp as a brand new corporation. I just 46 00:04:06,760 --> 00:04:12,120 turned 33. And that's how I got into investment management. 47 00:04:13,880 --> 00:04:19,360 Yeah, right. I always find the some people have straight paths and other 48 00:04:19,360 --> 00:04:24,040 people proceed to you know, you would never understand the path how they got 49 00:04:24,040 --> 00:04:29,160 there. But then when you look back at it, it's essentially the, you know, 50 00:04:29,160 --> 00:04:32,280 without that journey, they would not be where they are. And they wouldn't be 51 00:04:32,320 --> 00:04:35,760 able to have the insights and the ability to run such an operation. 52 00:04:36,320 --> 00:04:42,200 Absolutely. And look, the older I get, the more I want to help young people, 53 00:04:42,240 --> 00:04:45,960 especially young people coming into our industry, we have women in finance 54 00:04:45,960 --> 00:04:50,560 scholarships, etc. And what I say to them is, get in touch with your your 55 00:04:50,560 --> 00:04:53,800 feelings as to the sort of thing broadly you're interested in and then get 56 00:04:53,800 --> 00:05:01,120 started. And then the journey will go as it goes. And you'll have choices to 57 00:05:01,120 --> 00:05:06,560 make along the way. But as long as you're reasonably self aware, it'll take 58 00:05:06,560 --> 00:05:10,240 you in a good path, probably very different from what you initially 59 00:05:10,240 --> 00:05:14,960 imagined. I had no idea I'd end up in funds management. It was really because 60 00:05:14,960 --> 00:05:18,760 of the superannuation, you know, the growth that we could see ahead in that 61 00:05:18,760 --> 00:05:22,960 and the impact it could have on people's lives that got me so excited 62 00:05:22,960 --> 00:05:27,360 about investment management rather than, you know, running a treasury. 63 00:05:28,640 --> 00:05:33,080 Yeah, look, it's so true. Like, even my background, what I went Joey's was 64 00:05:33,280 --> 00:05:36,360 really, I really enjoyed the architecture. So I want to become an 65 00:05:36,360 --> 00:05:43,640 architect, then marrying architecture with the maths and the engineering level 66 00:05:43,640 --> 00:05:48,240 behind it ended up at Sydney University, didn't do architecture, but all my 67 00:05:48,240 --> 00:05:51,880 mates were architects. And what I learned was, if you're not the top 10% 68 00:05:51,880 --> 00:05:55,320 in architects, you males will have a cab license. And some of these some of 69 00:05:55,320 --> 00:05:58,240 these kids are sitting in university, some of my friends were just so 70 00:05:58,240 --> 00:06:03,080 talented. Yeah, and then and then but the other thing on which I realized, 71 00:06:03,080 --> 00:06:06,960 you know, going through that channel of friends is there's different ways which 72 00:06:06,960 --> 00:06:09,960 you can get into building beautiful things and the other and one of them 73 00:06:09,960 --> 00:06:13,960 which I thoroughly enjoyed was, you know, the finance side of things, right? 74 00:06:14,120 --> 00:06:18,320 And we'll get into it as well. But like, you know, one fun which we've had, you 75 00:06:18,320 --> 00:06:23,880 know, on before, which is Palisade, they're just doing such a great work for 76 00:06:23,880 --> 00:06:29,200 the Australian community in the mid tier infrastructure space. But you know, at 77 00:06:29,200 --> 00:06:33,720 the end of the day, everyone just wants to be a part of beautiful things being 78 00:06:33,720 --> 00:06:39,000 built. Yeah, quite interesting. It's fantastic. And you know, that tech 79 00:06:39,000 --> 00:06:42,880 background, I see computing and so on, that will stand you in very good stead in 80 00:06:42,880 --> 00:06:48,280 the future, because maybe we'll get into that the use of technology will 81 00:06:48,280 --> 00:06:55,120 be very important in delivering, you know, excellent investment outcomes to 82 00:06:55,240 --> 00:07:01,200 people who have a great need. Yeah, anyway, it's so funny you say that I 83 00:07:01,200 --> 00:07:03,640 did a bachelor of design and computing, I thought it's completely out of the 84 00:07:03,640 --> 00:07:06,680 waste of time, because I just wanted to roll at Sydney University and have fun 85 00:07:06,680 --> 00:07:09,640 and go to state and, you know, do the trans house man and all the types of 86 00:07:09,640 --> 00:07:13,360 jobs. But then fast forward 10 years, it's probably one of the best 87 00:07:13,360 --> 00:07:17,200 foundations for the modern world we're in. Yeah. Yeah. And then you know, 88 00:07:17,200 --> 00:07:22,560 master commerce, a bit of fun. But yeah, look, tell me about Pinnacle and how 89 00:07:22,560 --> 00:07:23,760 that came to be. 90 00:07:24,600 --> 00:07:30,160 Yeah, so I and my colleagues, who I guess you'd say were the founders of 91 00:07:30,160 --> 00:07:37,080 Pinnacle, we cut our teeth, got our early experience at institutional funds 92 00:07:37,080 --> 00:07:43,000 managers, you know, most fund managers were owned by banks or life companies 93 00:07:43,000 --> 00:07:49,720 and so on. And we were ultimately disillusioned at the ability of those 94 00:07:49,720 --> 00:07:57,280 kind of structures to provide the right environment for investment excellence, 95 00:07:57,960 --> 00:08:03,520 for the most talented investment professionals to get on with that 96 00:08:03,560 --> 00:08:09,520 extremely difficult but incredibly important job of delivering investment 97 00:08:09,520 --> 00:08:15,120 excellence, investment outperformance, you know, and also importantly in 98 00:08:15,120 --> 00:08:22,040 sustaining investment outperformance. Everyone was looking to take shortcuts, 99 00:08:22,040 --> 00:08:27,920 we were poaching each other's people, which our clients hated, by the way. 100 00:08:28,640 --> 00:08:35,760 It's the last thing clients wanted, they wanted stability. And, you know, the 101 00:08:35,760 --> 00:08:42,120 talent and investment professionals were distracted in so many ways. And the 102 00:08:42,120 --> 00:08:49,920 industry just wasn't set up to deliver what we were promising our clients. So 103 00:08:49,920 --> 00:08:56,040 we felt that there has to be a better way, a better environment for these 104 00:08:56,080 --> 00:09:03,400 talented, scarce, amazing people to go about, you know, this incredibly 105 00:09:03,400 --> 00:09:08,520 important task. So we came up with this, what we call the multi-boutique 106 00:09:08,520 --> 00:09:15,080 model, which we felt was the best of both worlds. We felt that the boutique 107 00:09:15,080 --> 00:09:22,080 environment was very likely to enable the most talented and experienced people 108 00:09:22,080 --> 00:09:28,440 to deliver the best outcomes. But a standalone boutique could be fragile. 109 00:09:28,440 --> 00:09:33,960 And the investment people could be distracted by the other functions. So 110 00:09:33,960 --> 00:09:37,560 to be an excellent investment management business, you have to be good at 111 00:09:37,560 --> 00:09:41,920 distribution, you have to have all the infrastructure to a truly excellent 112 00:09:41,920 --> 00:09:48,480 standard. And yet these people have to focus on investing. So how can you do 113 00:09:48,480 --> 00:09:53,720 all of that? So our solution was the best of both worlds. The boutique 114 00:09:53,720 --> 00:09:59,000 environment for these investment professionals, but with the functions 115 00:09:59,000 --> 00:10:05,760 where scale could be a benefit, you know, those were shared functions. And 116 00:10:05,800 --> 00:10:09,760 we took the responsibility for delivering those functions to the 117 00:10:09,760 --> 00:10:14,480 investment professionals to a very high standard and saying, if you don't want 118 00:10:14,480 --> 00:10:18,920 to, don't worry about these things. You just get on and investing. That's the 119 00:10:18,920 --> 00:10:26,440 scarce and precious piece. We'll do the other bits. So that's really, well, for 120 00:10:26,440 --> 00:10:31,600 me, it was perennial first, that was the first multi-boutique. And then in the 121 00:10:31,600 --> 00:10:38,400 end, things changed there. I went looking for another backer, because I was such a 122 00:10:38,400 --> 00:10:44,200 believer, I was just a passionate believer in this multi-boutique model. 123 00:10:44,200 --> 00:10:48,360 And it didn't really exist. So we had to build it. We had to build it from scratch. 124 00:10:48,360 --> 00:10:56,440 So I, for example, boring, you know, public servant ended up an entrepreneur 125 00:10:57,240 --> 00:11:03,200 out of necessity, because the model that I believed in didn't exist, we had to 126 00:11:03,200 --> 00:11:09,720 build it. And that was 17 years ago. It's been a long journey. And there were a 127 00:11:09,720 --> 00:11:15,640 lot of skeptics in the early days, but not too many skeptics anymore, Murdoch. 128 00:11:15,640 --> 00:11:19,680 People generally are believers that it's a great model. 129 00:11:20,720 --> 00:11:25,760 The brave go into the fray. Yeah, brave go into the fray. Indeed. Look, I've 130 00:11:25,760 --> 00:11:31,240 always respected entrepreneurs. And, you know, the people that can see that 131 00:11:31,240 --> 00:11:36,000 something there's a need, and it doesn't exist. And there's a whole lot of people 132 00:11:36,000 --> 00:11:39,520 that are going to hate you for it. But the thing is, at the end of the day, if 133 00:11:39,520 --> 00:11:42,240 your products sound and you know, there's a need, and you're actually 134 00:11:42,240 --> 00:11:47,560 giving people what they want in a better format, it just benefits everyone. And 135 00:11:47,560 --> 00:11:51,760 just to give for our listeners, I'm not really familiar with what a boutique 136 00:11:52,080 --> 00:11:56,920 fund manager is. Maybe we can discuss it in the concept of horses, right? It's a 137 00:11:56,920 --> 00:12:00,600 very nice way to putting it. So you know, everyone loves horses, but only some 138 00:12:00,600 --> 00:12:04,600 people can afford to, you know, own multiple horses, house them, warehouse 139 00:12:04,600 --> 00:12:08,480 them, feed them. And then but some people just want to ride horses or race 140 00:12:08,480 --> 00:12:14,800 horses, right? So would it be the correct analogy saying that you essentially own 141 00:12:14,820 --> 00:12:21,200 a horse stable, which enables people to, you know, own horses and keep them in 142 00:12:21,200 --> 00:12:23,840 your stables and make sure that everyone's looked and fed and then when 143 00:12:23,840 --> 00:12:25,160 they want to ride them, they can ride them. 144 00:12:25,480 --> 00:12:31,720 Absolutely. I'd go even further and say that the people who look after those 145 00:12:31,720 --> 00:12:36,680 horses can just focus on the horses and the looking after them, they don't have 146 00:12:36,680 --> 00:12:39,960 to worry about the broader aspects of the business and making sure that 147 00:12:39,960 --> 00:12:44,840 everything else is organized and so on. But yeah, it's a good analogy. It's all 148 00:12:44,840 --> 00:12:51,640 about focus and people doing the things that they're good at and not having to do 149 00:12:51,960 --> 00:12:52,600 everything. 150 00:12:53,240 --> 00:12:57,760 Yeah. Teams, teams make more money than an individual. 151 00:12:58,280 --> 00:13:04,040 Absolutely. And it's also a stronger and more resilient business model. If you 152 00:13:04,040 --> 00:13:09,640 only own one horse, you know, you'd have to be very lucky for it to be 153 00:13:09,640 --> 00:13:13,880 successful. Whereas if you do own a stable of them, you're going to have some 154 00:13:13,880 --> 00:13:14,520 winners. 155 00:13:15,520 --> 00:13:18,760 The other thing which I wouldn't mind discussing and your thoughts on this is 156 00:13:18,760 --> 00:13:22,880 that we saw when there was a big move into managed funds, what 20 years ago, 157 00:13:22,880 --> 00:13:25,920 you know, for Australians, which was everyone normally just had a ComSec 158 00:13:25,920 --> 00:13:29,760 account in Australian property. But the world of, you know, high end wealth 159 00:13:29,760 --> 00:13:36,360 management, you know, people were looking for incredibly brilliant minds to run 160 00:13:36,400 --> 00:13:40,280 wealth in particular asset classes, we did see a trend of a number of great 161 00:13:40,280 --> 00:13:44,600 firms coming out that started with one particular strategy and all of a sudden 162 00:13:44,600 --> 00:13:48,720 they had 10. But one thing I always thought was quite challenging for those 163 00:13:48,720 --> 00:13:53,440 firms was, you know, what happens if your main speciality is just say growth 164 00:13:53,440 --> 00:13:58,400 assets or your main specialities property or it's just fixed income? You 165 00:13:58,400 --> 00:14:02,480 know, we hope this isn't the case. But as we've noticed that nearly every single 166 00:14:02,480 --> 00:14:06,840 investment out there does have a particular cycle to it. It's short term 167 00:14:06,840 --> 00:14:12,840 or if it's long term. So why so with with the funds you currently have, how 168 00:14:12,840 --> 00:14:20,040 many funds are there and why have you chosen the particular strategy 169 00:14:20,060 --> 00:14:24,320 strategies in the portfolio? Is that to diversify against that cyclical risk? 170 00:14:24,320 --> 00:14:30,600 Or as it were? Absolutely. So we wanted to have a strong and resilient business 171 00:14:30,640 --> 00:14:37,360 that no one ever has to worry, could you be in trouble during a particular stage 172 00:14:37,360 --> 00:14:45,440 of the cycle? So we have 15 affiliates. We believe they are all amongst the 173 00:14:45,440 --> 00:14:51,560 best of their kind. And they all specialize in particular areas. And as 174 00:14:51,560 --> 00:14:56,760 you say, they're all different. And it's quite diverse. You know, we have 175 00:14:56,780 --> 00:15:02,880 Australian equities, global equities, global REITs, more recently, more private 176 00:15:02,880 --> 00:15:12,440 market asset classes, metrics is, is, you know, private credit. Cooler bar is 177 00:15:12,440 --> 00:15:20,640 listed credit, 5V is private equity, etc. So it covers a big range. So, you 178 00:15:20,640 --> 00:15:26,240 know, our proposition is simply, we don't have to do everything. But 179 00:15:26,280 --> 00:15:35,280 everything we do, we have to be excellent at. And we will deliver to our 180 00:15:35,280 --> 00:15:42,720 customer base, a range of investment capabilities, which are in need, which 181 00:15:42,720 --> 00:15:48,920 people are looking for, to a very high standard. With the talent investors 182 00:15:48,920 --> 00:15:53,600 focused on delivering just that, just their specialization. 183 00:15:55,440 --> 00:15:59,880 So let's let's discuss some of the actually, let's just let's do this, like 184 00:15:59,880 --> 00:16:05,600 say right now. Is there a particular asset class that's not currently in the 185 00:16:05,600 --> 00:16:11,880 stable that you're looking to, you know, find a partner for like, what's the 186 00:16:12,400 --> 00:16:18,280 Yeah, so there are quite a lot of the Murdoch. It's, it's amazing. People 187 00:16:18,280 --> 00:16:25,120 say to me, oh, you've got 15, surely you don't know. You know, the needs of 188 00:16:25,120 --> 00:16:32,120 investors are increasingly diverse. And there's a lot more out there that we 189 00:16:32,120 --> 00:16:35,960 could do. But we don't say we want to have one of these and one of these and 190 00:16:35,960 --> 00:16:41,040 one of these, the most important consideration for us is with a 191 00:16:41,040 --> 00:16:47,320 particular investment team that we discover, whether they approach us or we 192 00:16:47,320 --> 00:16:53,880 go looking for them, are they the real deal? Are these people the best in the 193 00:16:53,880 --> 00:17:00,400 business with a proposition that investors need? And if that's the case, 194 00:17:01,040 --> 00:17:06,160 then we'll back them and we'll deliver that to the market. Unfortunately, you 195 00:17:06,160 --> 00:17:09,280 know, we're listed and it's normally confidential when we're talking to 196 00:17:09,280 --> 00:17:13,600 people, they may well be working for a big institutional funds manager at the 197 00:17:13,600 --> 00:17:14,320 moment or 198 00:17:14,320 --> 00:17:18,000 I didn't ask the name. I just said, Hey, what's interesting in an ASSA class? 199 00:17:18,680 --> 00:17:23,440 Yeah, no, no. But, you know, we're talking to quite a lot of people at any 200 00:17:23,440 --> 00:17:31,720 point in time. And to be honest, many of them don't end up having us back them. 201 00:17:32,440 --> 00:17:37,560 In fact, I, you know, we do a huge amount of work with people, we need to 202 00:17:37,560 --> 00:17:43,480 get to know them extremely well. I used to say that of the people we look at 203 00:17:43,480 --> 00:17:49,400 closely, we probably only do one out of 10. And now it's probably one out of 20. 204 00:17:50,800 --> 00:17:57,080 So the bar is very high. The standard is very high because we're about 205 00:17:57,080 --> 00:18:04,160 investment excellence. And if we are not completely convinced about the 206 00:18:04,160 --> 00:18:09,520 proposition and the team, we'll say no, we don't have to do everything. We've 207 00:18:09,520 --> 00:18:15,360 got a great stable already. We think our existing strategies can go from 90 208 00:18:15,360 --> 00:18:21,320 billion to probably 400 billion in time. They don't exceed their capacity, but 209 00:18:21,320 --> 00:18:26,120 they've got a lot of capacity left. So if the new things we do have to be great, 210 00:18:27,120 --> 00:18:31,880 really great. But if you if you'd indulge me, if you're allowed to discuss 211 00:18:31,880 --> 00:18:36,480 that, I'd love to take a look under the hood about you know, how you have the 212 00:18:36,480 --> 00:18:42,520 business actually works and operates. So how has the mechanics of it actually 213 00:18:42,560 --> 00:18:43,480 work and operate? 214 00:18:43,640 --> 00:18:49,080 Yeah, so our business model is pretty straightforward. The investment 215 00:18:49,080 --> 00:18:55,280 professionals are the majority owners of their own business. They're an 216 00:18:55,280 --> 00:19:03,120 affiliate. And they can go about their job focus on investing. And we provide 217 00:19:03,120 --> 00:19:06,920 all the other services, institutional grade, distribution, infrastructure, 218 00:19:07,120 --> 00:19:13,200 they can choose to use all or any of our services, but they don't have to 219 00:19:13,200 --> 00:19:18,920 there's no compulsion. That's just there to support them. We make our money 220 00:19:19,200 --> 00:19:25,520 through the minority equity we own in those boutiques. So it's highly aligned. 221 00:19:26,120 --> 00:19:32,320 Most of our investment professionals are investors in their own funds. And we 222 00:19:32,320 --> 00:19:36,880 often invest in those funds as well. So there's just a tremendous amount of 223 00:19:36,880 --> 00:19:43,240 alignment. They make the decisions on when they're out of capacity, or 224 00:19:43,240 --> 00:19:51,400 whether they add any extra strategies. And we're there to support them. And 225 00:19:51,400 --> 00:19:56,360 they generally do use our services so that they can stay focused on investing. 226 00:19:57,000 --> 00:20:01,680 But it's a pretty simple model, minority equity, but we like it to be really 227 00:20:01,680 --> 00:20:08,280 real equity. We have arrangements with them for the recycling of equity. As 228 00:20:08,320 --> 00:20:17,720 younger investment professionals emerge. And when founders or older people look 229 00:20:17,720 --> 00:20:22,120 to retire, we expect that equity to be recycled because we're building 230 00:20:22,120 --> 00:20:25,200 businesses for the very long term. We expect... 231 00:20:25,200 --> 00:20:28,400 Am I just giving a bit more clarity on what you mean by recycled? 232 00:20:28,400 --> 00:20:35,120 Yeah. So there are arrangements whereby when the time comes, and we don't push 233 00:20:35,120 --> 00:20:41,040 for this to happen any sooner than it needs to, but when people are looking to 234 00:20:41,040 --> 00:20:48,880 step back or step down, they have to sell their equity to either emerging 235 00:20:48,880 --> 00:20:54,280 executors, often with loans from Pinnacle, or sometimes Pinnacle will buy 236 00:20:54,280 --> 00:20:58,480 that equity and over time, sell it to emerging executives. 237 00:20:58,480 --> 00:21:02,360 Is that contractional? Or is it more as you said with loans, it's in the 238 00:21:02,360 --> 00:21:06,880 capital stack that there's an agreement that you're first in the queue if 239 00:21:06,880 --> 00:21:11,720 someone's looking to retire and a key manager is looking to exit, you're 240 00:21:11,720 --> 00:21:15,880 first in the queue to have the rights but not the obligation to purchase that 241 00:21:15,880 --> 00:21:17,400 equity in the business? How does that work? 242 00:21:17,400 --> 00:21:20,720 Yeah. So it's all about ensuring succession and longevity of the 243 00:21:20,720 --> 00:21:26,320 businesses. It is contractual that they have to sell because we don't want 244 00:21:26,320 --> 00:21:30,840 people sitting on equity beyond them making a contribution anymore. 245 00:21:30,840 --> 00:21:34,880 One of the observations we make is that investment management firms around the 246 00:21:34,880 --> 00:21:42,520 world do succession poorly. And it's sad. People hang on for whatever 247 00:21:42,520 --> 00:21:49,520 reasons, ego or whatever. And we could name some big fund managers, 248 00:21:49,520 --> 00:21:57,920 who've had to dynamite out founders and who lose key emerging people because 249 00:21:57,920 --> 00:22:02,360 they don't do succession. But yeah, that's part of our secret source, 250 00:22:02,360 --> 00:22:09,520 Murdoch. It's part of the deal that we do when we partner with investment 251 00:22:09,520 --> 00:22:13,600 professionals, we contemplate succession, even though that might be 20 or 30 252 00:22:13,600 --> 00:22:18,680 years away, because it's too late once you're getting closer to it, 253 00:22:18,680 --> 00:22:21,440 to try to put arrangements in place. 254 00:22:21,440 --> 00:22:25,160 Yeah, it's very similar with conversations that we're having with 255 00:22:25,160 --> 00:22:31,240 wealthy families. Where the issues come is when someone makes a decision or 256 00:22:31,240 --> 00:22:35,720 health or something equivalent, or they want out tomorrow, and no one's had a 257 00:22:35,720 --> 00:22:39,560 conversation, no one knows what's going on, there's no communication. And then 258 00:22:39,560 --> 00:22:43,880 it's a dumpster fire of an event and emotions get involved and it's very 259 00:22:43,880 --> 00:22:44,960 difficult to handle. 260 00:22:44,960 --> 00:22:52,320 It's too late. And what a tragedy. Someone has spent a lifetime building 261 00:22:52,320 --> 00:23:00,040 something and it's a mess. That doesn't have to be that way and it shouldn't be 262 00:23:00,040 --> 00:23:06,840 that way. But you've got to be thoughtful from quite a long time earlier, way 263 00:23:06,840 --> 00:23:15,320 before it's imminent. And it's not perfect, but you can set things up to give 264 00:23:15,320 --> 00:23:20,360 the maximum prospect of good succession. 265 00:23:20,360 --> 00:23:25,440 Well, let's discuss that key person risk in some of these managed funds. Some of 266 00:23:25,440 --> 00:23:32,800 the fund managers I've met over time, they are the business. There's a very 267 00:23:32,800 --> 00:23:38,960 high profile one that was the number one player in global and is on its way back, 268 00:23:38,960 --> 00:23:44,400 but it's gone the way of Manchester United. How do you deal with having such 269 00:23:44,400 --> 00:23:49,520 a prolific figure leading the charge and then an event occurs and you do have 270 00:23:49,520 --> 00:23:55,840 that transition, but it's not exactly the shop that it was before. How do you 271 00:23:55,840 --> 00:24:00,000 help that firm in the old times? 272 00:24:00,000 --> 00:24:07,840 Yeah, we call them rock star fund managers. We don't do rock stars. So this 273 00:24:07,840 --> 00:24:14,000 is, I mentioned before that when we set up Pinnacle so long ago, it was to 274 00:24:14,000 --> 00:24:19,280 overcome the weaknesses we saw in the industry. One of the weaknesses was 275 00:24:19,280 --> 00:24:25,800 firms built on rock stars. And this happens all around the world. And we 276 00:24:25,800 --> 00:24:34,000 think that's a problem. We want teams, not individual rock stars. Now, of 277 00:24:34,000 --> 00:24:40,120 course, we do have key people. Every fund management businesses has key people. 278 00:24:40,120 --> 00:24:45,000 You need leadership, but there's a big difference. It's a little bit subtle. 279 00:24:45,000 --> 00:24:53,720 It's a fine line between good leaders, investment management leaders who are 280 00:24:53,720 --> 00:25:01,960 always talking and thinking team and rock stars who talk and think I. I 281 00:25:01,960 --> 00:25:05,600 mentioned we spent a lot of time with people before we decide whether to 282 00:25:05,600 --> 00:25:13,000 partner with them or not. And you can tell when people are talking more 283 00:25:13,000 --> 00:25:21,400 about I than we and, you know, that they're really on about, they think 284 00:25:21,400 --> 00:25:26,920 they are everything. And they may have people around them, but that's their 285 00:25:26,920 --> 00:25:31,360 servants rather than their colleagues. And we don't like that. We think that 286 00:25:31,360 --> 00:25:37,280 makes for a fragile business. Sure, it can blossom for a period of time and 287 00:25:37,280 --> 00:25:43,600 sort of slightly sadly, they attract people, they attract investors to them. 288 00:25:43,760 --> 00:25:50,040 People love to see a hero, you know, I want to believe in this guy. But the 289 00:25:50,040 --> 00:25:56,120 rock star thing has a terrible downside to it. So we spend a lot of time, as I 290 00:25:56,120 --> 00:26:05,160 said, working on succession and teams building and growing. And that's the 291 00:26:05,160 --> 00:26:12,320 reason we want to build long term enduring sustainable businesses. Yeah. 292 00:26:12,800 --> 00:26:17,840 Yeah, it's quite interesting. You know, I can't help myself, but I keep saying on 293 00:26:17,840 --> 00:26:22,160 the buses everywhere, the the new Napoleon movie coming out. Yeah, yeah. 294 00:26:22,600 --> 00:26:26,120 Well, there's there's been a number of phenomenal people in history, but the 295 00:26:26,120 --> 00:26:31,480 within the rise of fools and empires. But that's what I find quite fascinating 296 00:26:31,480 --> 00:26:33,720 about fund managers. And the conversations that I'm having with, you 297 00:26:33,720 --> 00:26:38,640 know, clients and friends and family members is, you know, this fund manager, 298 00:26:38,680 --> 00:26:40,840 oh, they're great, they're great person, they're making money, but then 299 00:26:40,840 --> 00:26:44,960 something changes. And what I've also noticed is with a lot of Australians 300 00:26:44,960 --> 00:26:48,360 that is so used to a standard Australian equity portfolio moving into managed 301 00:26:48,360 --> 00:26:51,600 funds, because they've had superannuation, a number of these last 302 00:26:51,600 --> 00:26:56,280 institutions, they're so they think that I stick my money in. And then these 303 00:26:56,280 --> 00:26:59,720 people are going to be able to manage that regardless and always get me the 304 00:26:59,720 --> 00:27:04,240 result. They don't understand that a funds business, they're just people, 305 00:27:04,440 --> 00:27:08,920 right? You're playing the person not necessarily and the team, it's not like 306 00:27:08,920 --> 00:27:11,840 you're purchasing an index fund or whether there's an algorithm going into 307 00:27:11,840 --> 00:27:18,240 it. No, it's quite interesting how you manage it, because by the sound of it, 308 00:27:18,240 --> 00:27:22,200 you're essentially running administration business for managed funds 309 00:27:22,240 --> 00:27:24,440 and your currencies people is that correct? 310 00:27:24,600 --> 00:27:30,880 People is everything. People is the absolute core. And I would say don't be 311 00:27:30,880 --> 00:27:35,800 in the funds management business. If you don't understand that these talented 312 00:27:35,800 --> 00:27:40,600 investors, investment professionals, they have certain personality traits, 313 00:27:40,600 --> 00:27:46,320 they can be difficult to work with, and so on. And it's a complex, it's a whole 314 00:27:46,320 --> 00:27:52,320 environment. It's not just one person out there being a genius, because the 315 00:27:52,320 --> 00:27:57,360 downside to that is just crash and disaster. Now we say that is not 316 00:27:57,360 --> 00:28:05,040 necessary. It is not inevitable that you'll get crashing. But you have to plan 317 00:28:05,040 --> 00:28:11,360 for it well in advance, you have to be able to work with these people. And you 318 00:28:11,360 --> 00:28:17,000 know, it's a day by day proposition. As issues start to emerge with people, you 319 00:28:17,000 --> 00:28:23,520 need to address them so they don't become big problems. Whereas, you know, 320 00:28:23,520 --> 00:28:27,960 with a rock star, people just convince themselves, it'll be okay, it'll be okay, 321 00:28:28,120 --> 00:28:29,600 you know, but it won't. 322 00:28:29,600 --> 00:28:35,480 Yeah, the only constant in life is change. So very true. So with just 323 00:28:35,480 --> 00:28:40,360 getting back to the mechanics a bit, how much with all the funds, the 15 324 00:28:40,360 --> 00:28:44,080 underneath Pinnacle now, how much money are they overseeing? 325 00:28:44,880 --> 00:28:46,640 A bit over 90 billion. 326 00:28:47,040 --> 00:28:48,560 $90 billion. 327 00:28:48,600 --> 00:28:57,400 Yeah, it's grown tremendously. Yeah, we've been listed now for seven years. 328 00:28:57,400 --> 00:29:03,200 And I think, I think we're probably about, you know, 20 billion, when we 329 00:29:03,200 --> 00:29:08,920 listed and we've grown very, very strongly, I think our CAGR, it's well 330 00:29:08,920 --> 00:29:14,560 over 20% per annum. So which just goes to show if you get something right, 331 00:29:14,880 --> 00:29:19,840 and it's not easy, and you have to execute continually, but if you get it 332 00:29:19,840 --> 00:29:26,040 right, people love it, and you will grow rapidly. But you need to be, you 333 00:29:26,040 --> 00:29:31,120 need to plan for rapid growth as well. And you know, our model is quite 334 00:29:31,120 --> 00:29:35,760 modular. So it can grow rapidly without problems. 335 00:29:38,040 --> 00:29:45,280 Can the fund managers work anywhere in Australia? Work from home? Or are they 336 00:29:45,280 --> 00:29:50,240 just required to? Yeah, so the requirements of the funds or? 337 00:29:50,240 --> 00:29:59,840 The overwhelming issue is what delivers for clients. That's what matters. 338 00:30:00,320 --> 00:30:04,480 So now certainly, we have some affiliates, as they become more and 339 00:30:04,480 --> 00:30:07,920 more global, you've got people in different parts of the world, and so 340 00:30:07,920 --> 00:30:14,400 on. But, you know, the majority of our affiliates now have their people in 341 00:30:14,400 --> 00:30:18,720 the office most of the time, because of those subtle benefits that they 342 00:30:18,720 --> 00:30:26,640 have, because of those subtle benefits of sort of collaboration and sparking 343 00:30:26,640 --> 00:30:32,120 off each other's and sharing ideas and so on. That's why it's turned out. 344 00:30:32,120 --> 00:30:37,760 Not because anyone's mandated it, but because, and each affiliate makes its 345 00:30:37,760 --> 00:30:44,160 own rules, you know, but that has tended to be the case. Investing is hard, 346 00:30:44,160 --> 00:30:48,960 but it's not going to be going for you. And so most of our affiliates have 347 00:30:48,960 --> 00:30:55,040 ended up figuring, but even though, you know, they like flexibility, and 348 00:30:55,520 --> 00:31:01,880 talented people need a degree of flexibility. They also need to work 349 00:31:01,880 --> 00:31:03,080 together quite a lot. 350 00:31:03,640 --> 00:31:08,440 Teams make more money. Yeah, very, very true. The other question I had is, is 351 00:31:08,440 --> 00:31:13,200 it predominantly Australian domiciled funds? Or do you have any 352 00:31:13,200 --> 00:31:15,280 considering any international domiciled funds? 353 00:31:15,840 --> 00:31:23,440 So at the moment, just because of our history, 13 of our 15 affiliates are 354 00:31:23,440 --> 00:31:29,360 sort of headquartered in Australia. A number of those have people located 355 00:31:29,360 --> 00:31:35,280 overseas, in the US, Canada, London, and Europe, etc. But 13 of them are 356 00:31:35,280 --> 00:31:41,440 headquartered here. Our two most recent builds, or what we call Horizon 2, 357 00:31:41,440 --> 00:31:47,920 where we build things from scratch, are overseas. One is AICIA, which is 358 00:31:47,920 --> 00:31:53,040 based in London. Although a couple of the key people are out here at the 359 00:31:53,040 --> 00:31:59,120 moment, Ashish presented at Hearts and Minds on Friday. But they're based in 360 00:31:59,120 --> 00:32:05,840 London, and Greg Dean and the Langdon team are based in Toronto, Canada. 361 00:32:05,840 --> 00:32:12,200 They do global small caps. And they're based there. Yeah, we think we're 362 00:32:12,200 --> 00:32:17,480 becoming increasingly global. It's a global industry. And we're finding a 363 00:32:17,480 --> 00:32:22,400 demand for what we do overseas, as well as in Australia. We've been doing 364 00:32:22,400 --> 00:32:27,200 distribution overseas for a while. About 11 billion of our 90 comes from 365 00:32:27,200 --> 00:32:32,400 overseas investors, and that's growing rapidly. So we think we will we will 366 00:32:32,400 --> 00:32:39,360 end up with quite a few more affiliates based overseas in global global asset 367 00:32:39,360 --> 00:32:40,320 classes. Yep. 368 00:32:40,320 --> 00:32:45,600 So if I'm understanding you correctly, the Australian domiciled business is 369 00:32:45,600 --> 00:32:49,680 going quite organically. And you're having a conversation with a lot of 370 00:32:49,680 --> 00:32:53,440 people. So as you said, you choose your one out of 20. So, you know, that's 371 00:32:53,440 --> 00:32:58,240 quite stable. Are you saying that your main, from a growth focus, 372 00:32:58,240 --> 00:33:04,400 internationally, is on the mind? Is that what you're saying? 373 00:33:04,400 --> 00:33:09,120 Yeah, and we don't rule out excellent things that are Australian based. And 374 00:33:09,120 --> 00:33:13,120 we tend to know the people here. But yeah, I think there'll be more done 375 00:33:13,120 --> 00:33:19,600 overseas than in Australia now. And Australian investors need global asset 376 00:33:19,600 --> 00:33:24,160 classes, a range of asset classes, and we'll, we'll deliver those. 377 00:33:24,880 --> 00:33:27,280 If the international business grows, and you probably can't talk about this 378 00:33:27,280 --> 00:33:32,400 because you're listed, would international listing be potentially on 379 00:33:32,400 --> 00:33:34,560 the cards? Look, a dual listing at all? 380 00:33:34,560 --> 00:33:39,520 Or? Yeah, look, I don't really think so, Murdoch. We love the Australian, 381 00:33:41,120 --> 00:33:47,120 you know, the ASX is a great base for us. We have, you know, a lot of 382 00:33:47,120 --> 00:33:52,320 Australian fund managers, institutional shareholders, but we have some foreign 383 00:33:52,320 --> 00:33:56,560 ones as well. But they don't, they don't seem to be calling for us to be listed 384 00:33:56,560 --> 00:34:00,160 over there. They seem to be able, you know, they're global equities managers, 385 00:34:00,160 --> 00:34:04,880 they seem to be able to invest in a company listed on the ASX. I just think 386 00:34:04,880 --> 00:34:11,280 we need to stay focused and true to what has made us what's made us great. And 387 00:34:11,280 --> 00:34:16,400 we don't want to get over our skis. Yeah, yeah, we how many times we've seen 388 00:34:16,400 --> 00:34:21,040 that before when you've done so well in your, you know, your little patch, and 389 00:34:21,040 --> 00:34:24,960 then companies try to overextend in particular areas, like look at Starbucks, 390 00:34:24,960 --> 00:34:28,640 right? Yeah. Or, you know, going to the foray and then realize, hold on a second, 391 00:34:28,640 --> 00:34:31,680 you know, people in particular countries do not like coffee. Yeah, 392 00:34:32,640 --> 00:34:38,160 absolutely. And we've said, as we do things overseas, we're going to be 393 00:34:38,160 --> 00:34:45,680 incredibly careful. Because we're acutely aware of those mistakes. Yep. You've got 394 00:34:45,680 --> 00:34:55,120 to keep the right culture. So we talked about, okay, what's a day in your life? So 395 00:34:55,120 --> 00:35:04,080 for me, I'm a servant leader, my the most important aspects of my job, making sure 396 00:35:04,080 --> 00:35:11,200 that we are doing an excellent job of supporting our affiliates. So I'm on the 397 00:35:11,200 --> 00:35:17,440 board of many of our affiliates, plus where their distribution partner, where 398 00:35:17,440 --> 00:35:25,520 their ops partner. I say to people, I spend most of my time on worrying about 399 00:35:25,520 --> 00:35:30,240 the things that could go wrong. And any issues that are emerging, because I've 400 00:35:30,240 --> 00:35:36,080 always had this philosophy, if you address things early, as soon as they are 401 00:35:36,080 --> 00:35:45,440 emerging, then nothing becomes a really big problem. So a day in my life, often 402 00:35:45,440 --> 00:35:50,640 affiliate board meetings, but I also catch up informally with a lot of people 403 00:35:50,640 --> 00:35:58,320 in our affiliates. And then our people in distribution and all of our ops, etc. 404 00:35:58,320 --> 00:36:04,480 I'm sort of there at their disposal if they need me, if there's anything 405 00:36:04,480 --> 00:36:10,880 complicated or important that they need me. I also have to stay open to our 406 00:36:10,880 --> 00:36:14,400 shareholders. I mentioned institutional shareholders, we've got to keep them 407 00:36:14,400 --> 00:36:21,200 informed. Twice a year, we have results, annual results, half year results, we 408 00:36:21,200 --> 00:36:27,920 spend a week out on the road talking to shareholders. So that's one aspect. But 409 00:36:27,920 --> 00:36:33,280 we keep it a flat structure, we keep it tight, we keep the personal 410 00:36:33,280 --> 00:36:40,080 relationships strong, we need to know what's going on in our people's lives. 411 00:36:41,920 --> 00:36:44,560 How many people in Pinnacle now? 412 00:36:44,560 --> 00:36:52,720 There are about 120 in Pinnacle itself. And broadly, about half of those are in 413 00:36:52,720 --> 00:37:00,880 distribution, marketing, etc. Australian wholesale and retail distribution 414 00:37:00,880 --> 00:37:08,480 institutional offshore, and about half are operations. You know, responsible 415 00:37:08,480 --> 00:37:16,480 entity, middle office, finance, risk, insurance, all that stuff. All the 416 00:37:16,480 --> 00:37:21,360 stuff that just has to be done very well so the investment professionals don't 417 00:37:21,360 --> 00:37:22,880 have to worry about it. 418 00:37:22,880 --> 00:37:28,560 Do you see any changes? I did a podcast yesterday and one of the he's asked him 419 00:37:28,560 --> 00:37:32,080 what was the main risks he's currently facing. He said the main risk is 420 00:37:32,080 --> 00:37:36,480 essentially regular regulation risk, you know, with the government. Is there any 421 00:37:36,480 --> 00:37:42,160 big risks coming down the pike with regulation? Like, you know, I'm a 422 00:37:42,160 --> 00:37:46,000 financial advisor, we just went through the phaser. I think there was what 16,000 423 00:37:46,000 --> 00:37:49,520 advisors and then went down to 8000 now. Massive. 424 00:37:49,520 --> 00:37:54,400 Pass the test and there's fantastic investors, you know, 60 year olds, 50 425 00:37:54,400 --> 00:37:58,720 year olds that are essentially being forced out purely because they did what 426 00:37:58,720 --> 00:38:03,120 probably all of us should have done and, you know, not spent five years and, you 427 00:38:03,120 --> 00:38:07,760 know, how many hundreds of dollars in education and they just went straight 428 00:38:07,760 --> 00:38:11,440 into the game and they're probably some of the best advisors that I've ever seen 429 00:38:11,440 --> 00:38:16,160 or had the privilege of working with. But there's continuous changes. What do 430 00:38:16,160 --> 00:38:17,600 you see happening? 431 00:38:17,600 --> 00:38:22,960 Absolutely. And, you know, we're sort of a market led organization. We brought 432 00:38:22,960 --> 00:38:28,000 ourselves on being very close to our clients and customers and understanding 433 00:38:28,000 --> 00:38:32,720 how their needs are changing, how our industry is changing. But yes, we are in 434 00:38:32,720 --> 00:38:38,800 a very heavily regulated industry and I would say rightly so. We are entrusted 435 00:38:38,800 --> 00:38:45,360 with other people's money. That's a huge fiduciary responsibility. It's 436 00:38:45,360 --> 00:38:52,160 important to understand where the regulators are coming from and stay ahead 437 00:38:52,160 --> 00:38:57,440 of all of that. We put a lot of emphasis on it to make sure we're not ever going 438 00:38:57,440 --> 00:39:04,320 to be in trouble. We're ever going to be doing anything that might cause us to 439 00:39:04,320 --> 00:39:11,040 run foul of the regulator. We put a lot of emphasis on, you know, just ethics 440 00:39:11,040 --> 00:39:17,360 and having high standards and always thinking about our investors, the people 441 00:39:17,360 --> 00:39:23,280 whose money it is. Our mission or purpose of our company is enabling better lives 442 00:39:23,280 --> 00:39:28,880 through investment excellence. So we're always thinking about our customers. So 443 00:39:28,880 --> 00:39:35,280 there have been changes for fund managers in regulation. Your super your 444 00:39:35,280 --> 00:39:42,560 future was one that made some changes. But it's more the investment environment 445 00:39:42,560 --> 00:39:48,160 is changing. I mentioned it's globalizing, etc. So another thing is 446 00:39:48,160 --> 00:39:55,680 technology is going to change things a lot. You know, people are talking about AI, 447 00:39:55,680 --> 00:40:03,200 but I think we generally only have a very vague idea of what it means. To me, 448 00:40:03,200 --> 00:40:11,040 it will be enormous. And I want to make sure that we understand the potential of 449 00:40:11,040 --> 00:40:18,400 all of these new tools, the new data, the computing power, what can be done to 450 00:40:18,400 --> 00:40:24,320 gain insight to make better investment decisions. That's going to be quite big. 451 00:40:24,320 --> 00:40:29,600 All of our affiliates are working on it in one way or another, but it's quite 452 00:40:29,600 --> 00:40:37,120 uncertain. As you say, uncertainty is uncertainty prevails. But, you know, 453 00:40:37,120 --> 00:40:42,960 these are also opportunities. If you're focused on excellence, if you're 454 00:40:42,960 --> 00:40:48,960 focused on doing everything you can to be the best investors you can be, then 455 00:40:48,960 --> 00:40:54,720 you don't miss these things. You know, you are there. 456 00:40:54,720 --> 00:41:01,200 Let's keep going on the tech and the AI and just the evolution that is the 457 00:41:01,200 --> 00:41:05,680 access to information. Like I was listening to Joe Rogan and Elon Musk 458 00:41:05,680 --> 00:41:11,920 discuss AI the other day. He says that he's actually quite cautious about 459 00:41:11,920 --> 00:41:17,680 the damage which it can do. But then I speak, I use it myself in a number of 460 00:41:17,680 --> 00:41:21,920 aspects and it takes tasks that might take four hours down to like 30 minutes. 461 00:41:21,920 --> 00:41:24,960 You can phrase an article as a particular question and then you get 462 00:41:24,960 --> 00:41:30,160 talking points and it just completely has expanded. And like me personally, 463 00:41:30,160 --> 00:41:33,200 around my own business, we all call off management, used to be with 464 00:41:33,200 --> 00:41:36,640 showing partners. But if you look 20 years ago, I've got a number of friends 465 00:41:36,640 --> 00:41:40,320 that came through JB, we're Morgan Stanley, a number of these fine 466 00:41:40,320 --> 00:41:44,720 institutions, but they held the keys to you know, if you're an advisor, you had 467 00:41:44,720 --> 00:41:49,520 to work at a large institution if you wanted any research fast forward 20 468 00:41:49,520 --> 00:41:55,360 years. And, you know, I'm very privileged to now be able to do what I do because 469 00:41:55,360 --> 00:42:00,800 I have now access to so many fantastic third parties that have just evolved 470 00:42:00,800 --> 00:42:06,320 efficiently providing access to efficient, accurate on time information 471 00:42:06,320 --> 00:42:10,400 that just makes my life able to live the life which I do. Like how are you 472 00:42:10,400 --> 00:42:14,400 finding the evolution of technology and AI in the business? 473 00:42:14,400 --> 00:42:21,840 Yeah, absolutely. So, I mean, technology is the secret to improving 474 00:42:21,840 --> 00:42:29,120 productivity and to overall advancement of standards, ultimately to improve 475 00:42:29,120 --> 00:42:34,720 lives and living standards. Of course, all technology can be dangerous or 476 00:42:34,720 --> 00:42:41,440 damaging if it's used the wrong way and we do need to be careful about that. 477 00:42:41,440 --> 00:42:47,600 But the big risk is missing the opportunity and not being on the front 478 00:42:47,600 --> 00:42:51,840 foot and taking advantage. I mean, I think even of the internet, people 479 00:42:51,840 --> 00:42:55,920 ask me about AI and I say, well, think about the internet. When it started, 480 00:42:55,920 --> 00:43:01,440 it was some vague, only techos had any idea about it really and this idea 481 00:43:01,440 --> 00:43:09,440 about the cloud and email and all this stuff. It was just mind boggling. But 482 00:43:09,440 --> 00:43:15,440 then we started to see the practical applications and it's been a revolution. 483 00:43:15,440 --> 00:43:21,520 And, you know, how much improvement has occurred. AI will be the same, but 484 00:43:21,520 --> 00:43:29,120 you'll need to understand it. You'll need to have the resourcing. You know, 485 00:43:29,120 --> 00:43:36,400 it means adding some expense and, you know, studying the emerging 486 00:43:36,400 --> 00:43:42,960 capabilities that are available to you. Sort of two categories. One is massive 487 00:43:42,960 --> 00:43:48,160 improvements in efficiency, as you've talked about, which we are onto. And 488 00:43:48,160 --> 00:43:55,760 that will be tremendous. But in investing, better investing insights. 489 00:43:55,760 --> 00:44:00,480 I mean, I've always said investing is pretty simple, really. It's 490 00:44:00,480 --> 00:44:06,640 researching and uncovering the information that you need. Then it's 491 00:44:06,640 --> 00:44:12,640 analysing it and gaining insight out of it. Pretty simple, really. And, you 492 00:44:12,640 --> 00:44:16,480 know, over the decades, I mean, back in the day, people spent the first 493 00:44:16,480 --> 00:44:23,520 majority of their time trying to find the information. Now, finding it, you 494 00:44:23,520 --> 00:44:28,320 still have to be smart enough to know what data you're looking for and so on. 495 00:44:28,320 --> 00:44:36,560 But the tools are there. The computing power is enormous. So, you know, if 496 00:44:36,560 --> 00:44:43,120 you're not onto it, onto figuring out how you can use this emerging AI type 497 00:44:43,120 --> 00:44:48,080 technology, which will be completely different and keep evolving 498 00:44:48,080 --> 00:44:51,760 enormously, you just won't be a good investor in time. 499 00:44:51,760 --> 00:44:56,480 I find this quite interesting, this particular topic, not just for funds 500 00:44:56,480 --> 00:45:00,320 management, but just human beings. I've got two kids, a four-year-old, I'm 501 00:45:00,320 --> 00:45:03,600 turning six, right? So, you know, we're looking, you know, at the school 502 00:45:03,600 --> 00:45:06,960 system and going, okay, well, you know, it was once created by a good old 503 00:45:06,960 --> 00:45:11,280 Rockefeller and Ford to essentially put everyone into an industry. And then 504 00:45:11,280 --> 00:45:14,400 1957, you know, they said, hold on a second, we want to stick people on 505 00:45:14,400 --> 00:45:18,000 NASA and then my mom got free education in university because they 506 00:45:18,000 --> 00:45:23,040 wanted doctorates and etc. But, you know, I think there's been a change in 507 00:45:23,040 --> 00:45:29,200 New South Wales recently, an update to how they're educating kids. But I 508 00:45:29,200 --> 00:45:34,480 still find it's behind. And what I mean by this is I still find that, yes, you 509 00:45:34,480 --> 00:45:38,480 need to teach the reading, the writing, the arithmetic, but then arithmetic, 510 00:45:38,480 --> 00:45:44,640 sorry. But as you said, accurately, is it's not before it was, hey, let's 511 00:45:44,640 --> 00:45:47,840 fill everyone's brain up with information. And then, you know, you may 512 00:45:47,840 --> 00:45:52,400 have a task where you can use it. But what you're really talking about is 513 00:45:52,400 --> 00:45:57,440 comprehension skills. Like there is so much information readily available at a 514 00:45:57,440 --> 00:46:01,200 drop of a hat. I think South Park just came out with an episode, I won't touch 515 00:46:01,200 --> 00:46:04,560 the Disney subject, but they were discussing how AI that you know, 516 00:46:04,560 --> 00:46:08,640 normally, yeah, you know, people that are unlicensed immigrants over in America, 517 00:46:08,640 --> 00:46:12,480 they'll go to Home Depot to get a job as but they're the wealthy ones, some of 518 00:46:12,480 --> 00:46:15,600 my friends are making more money than God, you know, as plumbers and 519 00:46:15,600 --> 00:46:18,560 everything, because no one knows how to do anything anymore. Right. And 520 00:46:18,560 --> 00:46:24,480 they're holding signs going, I've got a $250,000, you know, debt, you know, with 521 00:46:24,480 --> 00:46:29,520 a particular university for a geology degree. Right. Yeah. Which it is 522 00:46:29,520 --> 00:46:32,640 ridiculous now because you just anyone can just search with AI, you know, 523 00:46:32,640 --> 00:46:37,200 how does geology work? Right. So what's your suppose the where I'm going with 524 00:46:37,200 --> 00:46:41,760 this is there's a lot of young people probably listening this podcast as well 525 00:46:41,760 --> 00:46:45,520 that want to get into funds management or, you know, your business or be a fund 526 00:46:45,520 --> 00:46:50,800 manager or the investment guy. What's your, you know, counsel, you know, to to 527 00:46:50,800 --> 00:46:56,080 them with how do you deal with, you know, AI and then building their skill sets to 528 00:46:56,080 --> 00:47:00,960 essentially embark on the journey that you've had? Yeah, so look, I think 529 00:47:00,960 --> 00:47:07,120 things will change massively and radically. So I agree with you. You can't 530 00:47:07,120 --> 00:47:10,640 fill your brain with all the things you need, because as soon as you do, it's 531 00:47:10,640 --> 00:47:16,000 redundant. But as I said at the beginning, because some things never 532 00:47:16,000 --> 00:47:20,960 change the the essentials. And as long as you stay focused on the essential 533 00:47:20,960 --> 00:47:27,760 aspects of what need are you seeking to meet? Because, you know, people's need 534 00:47:27,760 --> 00:47:34,080 for investing will never go away. It's a matter of how you can how you can 535 00:47:34,080 --> 00:47:38,640 achieve it and get it to them. So what I'd say to young people is, well, 536 00:47:38,640 --> 00:47:47,120 absolutely, you need to study some tech, you need to be tech aware. And the 537 00:47:47,120 --> 00:47:51,120 specifics of it to some degree don't really matter. I would also say you need 538 00:47:51,120 --> 00:47:56,560 to make a start in finance somehow. You know, you have to be a tech 539 00:47:56,560 --> 00:48:02,080 expert. You know, you have to show your interest in your aptitude. And by the 540 00:48:02,080 --> 00:48:07,280 way, do a good job of it, because employers are looking for talented 541 00:48:07,280 --> 00:48:14,000 people. And we need to see some evidence to say, yes, I want this person and 542 00:48:14,000 --> 00:48:18,880 not that person. So you need to get in and just start to demonstrate your 543 00:48:18,880 --> 00:48:27,120 interest and your ability. But it's not about the specifics. Once you get 544 00:48:27,120 --> 00:48:31,440 started, you know, get started in your career, because so much of the 545 00:48:31,440 --> 00:48:37,840 learning that you find mentors, and you develop so much once you start, and 546 00:48:37,840 --> 00:48:42,480 you may change exactly what you're doing, you probably change many times. 547 00:48:42,480 --> 00:48:49,360 And your kids at four and six, they will change many times. But the basic 548 00:48:49,360 --> 00:48:53,760 idea of thinking about who your customer or client is, what their needs 549 00:48:53,760 --> 00:49:01,120 are, and my job is to find ways to meet that need, that'll never change. It's 550 00:49:01,120 --> 00:49:09,680 just the specifics of how you deliver it that change. And also people, as 551 00:49:09,680 --> 00:49:14,480 we discussed, put time into your relationships. And I think the younger 552 00:49:14,480 --> 00:49:20,000 generation do that better than I did, my generation did. You need to work with 553 00:49:20,000 --> 00:49:24,640 people, it'll always be teamwork. I don't care what the computers and the 554 00:49:24,640 --> 00:49:28,880 tools are, you still need to collaborate and work with other people. 555 00:49:28,880 --> 00:49:33,280 Yeah, I couldn't agree more. There's Elon Musk was discussing how he 556 00:49:33,280 --> 00:49:37,040 pulled his kids out of school, and then he built his own school. I call it 557 00:49:37,040 --> 00:49:41,120 the synthesis or something equivalent. And the entire thing was they got rid 558 00:49:41,120 --> 00:49:46,160 of, you know, ages for schools, and it was about on aptitude. And the entire 559 00:49:46,160 --> 00:49:49,680 thing was from the starting the age of seven, they're playing games like high 560 00:49:49,680 --> 00:49:53,440 end comprehension games, essentially like Fortnite on steroids. Yeah, it was 561 00:49:53,440 --> 00:49:57,200 and they had like four or five kids. And then there was there was no 562 00:49:57,200 --> 00:50:01,280 instructions. There was no nothing. It's just, you know, keep having a go at 563 00:50:01,280 --> 00:50:04,400 this. And what they found really quite interesting is, is some leaders came 564 00:50:04,400 --> 00:50:08,960 out, the doers came out, you know, if something's, you know, kids have the 565 00:50:08,960 --> 00:50:14,960 ability to essentially explore, find themselves and then do teamwork. And 566 00:50:14,960 --> 00:50:18,400 the more I read about this, the more I think, you know, you know, my kids or 567 00:50:18,400 --> 00:50:21,200 friends kids, right, that that particular skill set, you know, when 568 00:50:21,200 --> 00:50:24,000 we're, you know, working in our my business, your business, or a farm 569 00:50:24,000 --> 00:50:27,040 manager or something equivalent, it's all teams, right, the ability, 570 00:50:27,040 --> 00:50:31,840 everything changes every single day. Nothing's everything's fluid, every, 571 00:50:31,840 --> 00:50:35,520 you know, and then how do we, as you said, what I asked you, what are you 572 00:50:35,520 --> 00:50:38,480 doing your day? And you said, well, predominantly creating solutions to 573 00:50:38,480 --> 00:50:42,400 problems that arise, right? Every single day, problem solving, right? 574 00:50:42,400 --> 00:50:45,920 Working with people to do that. Yeah. And it's essentially people, people, 575 00:50:45,920 --> 00:50:49,760 people, it's people and problem solving. It's just so interesting. 576 00:50:49,760 --> 00:50:54,720 So every discussion system is going to have to change a lot too. But they'll 577 00:50:54,720 --> 00:51:02,640 have some good tools. We hope we've got good people doing the redesign. 578 00:51:02,640 --> 00:51:06,320 Yeah, that's a whole topic for another conversation. Don't put anyone 579 00:51:06,320 --> 00:51:08,960 offside. But look, a lot of great teachers out there that have done a 580 00:51:08,960 --> 00:51:13,120 great job. You know, they're working again, it's a system, right? You know, 581 00:51:13,120 --> 00:51:16,800 we're discussing regulatory changes, you know, what are the changes in the 582 00:51:16,800 --> 00:51:20,240 system? And you know, how do you go about that to essentially improve 583 00:51:20,240 --> 00:51:23,680 one's life, which is everyone's thinking, correct? Yeah, using the 584 00:51:23,680 --> 00:51:30,560 technology that's becoming available. Yeah. The other question I had is 585 00:51:30,560 --> 00:51:34,560 there's some shareholders probably listening in. And there's some people, 586 00:51:34,560 --> 00:51:38,080 you know, that may want to go down the journey of building, you know, a stable 587 00:51:38,080 --> 00:51:44,640 of fund managers. What are the numbers? You know, what type of profit margins? 588 00:51:44,640 --> 00:51:48,080 You know, how does it, what are the numbers of the business? Yeah. So the 589 00:51:48,080 --> 00:51:53,360 way we have always operated, the way we've built Pinnacle, we don't say, oh, 590 00:51:53,360 --> 00:51:59,040 we want to get to a certain level of profit, even a certain level of funds. 591 00:51:59,040 --> 00:52:04,880 We've essentially said, look, we're on a mission here. We believe, you know, 592 00:52:04,880 --> 00:52:09,600 with every fiber of our body, that there is a better way of doing funds 593 00:52:09,600 --> 00:52:14,320 management. And we think we need, we know what the key ingredients are, you 594 00:52:14,320 --> 00:52:18,640 know, the talented professionals in a certain environment supported 595 00:52:18,640 --> 00:52:25,600 properly. So if we just go out and we find the best people in a range of 596 00:52:25,600 --> 00:52:33,520 fields, we do a good job of taking that to clients, well, it'll be a success, 597 00:52:33,520 --> 00:52:39,760 you know? And I'd have to say it's been successful beyond anything we 598 00:52:39,760 --> 00:52:47,040 imagined. But it's a platform now and it will grow a lot from here. I wish I 599 00:52:47,040 --> 00:52:51,840 was 20 years younger because, you know, you ain't seen nothing yet. But it's 600 00:52:51,840 --> 00:52:58,160 about doing an excellent job and doing it for the customers and meeting the 601 00:52:58,160 --> 00:53:04,560 needs you know they have. If you keep doing that, the numbers will work out. 602 00:53:04,560 --> 00:53:08,960 So, you know, as it's turned out, we've all made more money than we ever 603 00:53:08,960 --> 00:53:14,480 imagined, not because that's what we set out to do. We set out to do 604 00:53:14,480 --> 00:53:20,240 something that we thought was important and do it better. And so it turns out 605 00:53:20,240 --> 00:53:25,520 lots of people want to invest with our affiliates. That's, you know, young 606 00:53:25,520 --> 00:53:31,680 people sometimes say to me, as I say, I talk to a lot of them, I try to help, 607 00:53:31,680 --> 00:53:36,000 they say, hey, we want to be like you. And you say, well, what do you mean by 608 00:53:36,000 --> 00:53:40,240 that? And if it turns out they're saying, I want to make a lot of money for 609 00:53:40,240 --> 00:53:48,080 myself. So you'll almost certainly fail, young man or young woman, because if 610 00:53:48,080 --> 00:53:53,520 you do that, you'll take shortcuts. You will not do the right thing by your 611 00:53:53,520 --> 00:53:59,200 customers. But if you are on a passionate journey to deliver a need 612 00:53:59,200 --> 00:54:05,040 that is a major need, and you're just devoted to doing that, you find people 613 00:54:05,040 --> 00:54:10,320 who are also devoted to it, get on with it, you'll make quite a lot of money. 614 00:54:11,200 --> 00:54:17,920 You know, our market caps about one and a half billion dollars. It was three 615 00:54:17,920 --> 00:54:21,520 billion, you know, our share price is half in the last two years as we've 616 00:54:21,520 --> 00:54:25,280 gone through that difficult stage of the cycle. We're not fussed about that at 617 00:54:25,280 --> 00:54:31,280 all. We're focused on the medium term. We always have been. So look, the 618 00:54:31,280 --> 00:54:36,240 numbers work out. Well, it's quite profitable. We always price our things 619 00:54:36,240 --> 00:54:42,880 very fairly, we want to be good value for our investors. But it also has to 620 00:54:42,880 --> 00:54:49,200 be a successful commercial proposition for your shareholders. We talk about four 621 00:54:49,200 --> 00:54:54,800 groups of stakeholders, our clients or customers, number one, our 622 00:54:54,800 --> 00:55:00,480 shareholders, our people, we have to have an environment where top quality 623 00:55:00,480 --> 00:55:06,800 people love working. And then the community, the broader community, where 624 00:55:06,800 --> 00:55:11,920 we're doing lots of things. You mentioned some of our managers, you've seen what 625 00:55:11,920 --> 00:55:17,840 amazing things they're doing for, you know, climate and the environment and 626 00:55:17,840 --> 00:55:25,200 society generally. Of course, our fundamental purpose is helpful to 627 00:55:25,200 --> 00:55:33,520 people's lives, enabling better lives. So that's the main game. And the 628 00:55:33,520 --> 00:55:37,840 financial numbers fall out and end up being pretty good if you're good at it. 629 00:55:37,840 --> 00:55:39,760 And if you're not, you'll fail. 630 00:55:42,000 --> 00:55:46,320 I think that's quite good advice, build something that people want to play with. 631 00:55:46,320 --> 00:55:49,200 And then if they want to play with it, they play with it. And then essentially, 632 00:55:49,200 --> 00:55:53,360 you know, don't focus on the money. That's actually been the whole core of 633 00:55:53,360 --> 00:55:56,880 what FASIA is about. Don't focus on conflict and mutilation. If you build 634 00:55:56,880 --> 00:56:00,320 and generally look after your family or the people you're looking after and you 635 00:56:00,320 --> 00:56:03,280 want to build a service and you want to do it to the highest standard, and 636 00:56:03,280 --> 00:56:07,840 essentially the rewards follow. Don't put the car before the horse. 637 00:56:08,560 --> 00:56:09,060 Correct. 638 00:56:10,240 --> 00:56:13,840 So what keeps you up at night and what gets you out of bed in the morning? 639 00:56:16,720 --> 00:56:20,240 So look, to be honest, I sleep pretty well, Murdoch. 640 00:56:20,240 --> 00:56:24,720 I mean, look, part of that's deliberate because I am interested in health and I know that 641 00:56:25,040 --> 00:56:29,760 sleeping well is very important to that and to functioning at a high level. 642 00:56:30,800 --> 00:56:38,480 I mentioned before that I work hard to address issues as they emerge. 643 00:56:39,760 --> 00:56:45,040 And I work with my colleagues to do that. And if you do that, which is not easy, 644 00:56:45,040 --> 00:56:50,320 because people's natural tendency is to dodge hard things. But if you do it, 645 00:56:50,800 --> 00:56:58,080 nothing becomes a big problem. The sort of things that really will keep you awake at night, all night. 646 00:56:58,880 --> 00:57:04,720 So I feel, you know, very good about the quality of the people around me and our business 647 00:57:05,520 --> 00:57:11,840 and our business model and our capabilities and so on. So the things that you might think 648 00:57:11,840 --> 00:57:16,400 might keep me up awake at night really don't. 649 00:57:17,520 --> 00:57:22,320 And that's not that I'm complacent, but that we address things. 650 00:57:23,600 --> 00:57:32,480 I mentioned before the changing nature of investing and technology, whether we'll be able to adopt 651 00:57:32,480 --> 00:57:40,240 the right new technologies and data and so on. I hate the thought of me being a 652 00:57:40,240 --> 00:57:46,080 good investor. I hate the thought of missing opportunities and not being as good as we can 653 00:57:46,080 --> 00:57:53,360 possibly be. That's one thing I do worry about. In the end, it'll be younger people than me who 654 00:57:53,360 --> 00:57:59,600 have the responsibility of delivering that. But you know what I worry about most of all 655 00:58:00,240 --> 00:58:07,760 is the people who are missing out. There are so many people miss out, for example, on the benefits 656 00:58:07,760 --> 00:58:15,280 of investing. There are so many people out there who just don't know what to do about money. 657 00:58:16,880 --> 00:58:25,520 And with their money, they don't know where to get help. So sadly, just sort of out of fear 658 00:58:26,560 --> 00:58:37,200 or just not knowing, money is not used in the way that it ought to be. And you know, you are not 659 00:58:37,200 --> 00:58:42,960 going to get the sort of outcomes you need with your money if money is left in bank accounts 660 00:58:44,080 --> 00:58:50,960 or cash or just the wrong kind of investments. And you know, I said to a good friend of mine 661 00:58:51,520 --> 00:58:58,080 recently who's very involved in financial literacy, I said to him, you know, Paul, 662 00:58:59,120 --> 00:59:04,560 I'm afraid that I'm going to end up retiring not having been able to do anything about the fact 663 00:59:04,560 --> 00:59:10,240 that investors come pouring to the equity market after equities have gone up a long way, 664 00:59:11,120 --> 00:59:18,480 and they come out after it's gone down. And it's just a tragedy. And he said to me, well, you know, 665 00:59:18,480 --> 00:59:27,680 Ian, it's in our DNA, fear and greed, and so on. So we need to take some responsibility for helping 666 00:59:27,680 --> 00:59:36,800 people. But I do worry that we as an industry don't do a good enough job in helping people 667 00:59:36,800 --> 00:59:44,800 to get the right outcomes with their money. Yeah, it's always an interesting one. How do you 668 00:59:44,800 --> 00:59:49,840 get people on the right path of education? Hopefully someone someday may petition the 669 00:59:49,840 --> 00:59:56,320 government to allow their finance to be taught in schools, accounting, legal, just shake things up, 670 00:59:56,320 --> 01:00:00,320 or, you know, anyone out there that runs an institution or thinking about, you know, opening 671 01:00:00,320 --> 01:00:06,320 up an institution, preferably someone in Lankov, you know, that, you know, offers primary or high 672 01:00:06,320 --> 01:00:13,440 school and, you know, the ability to educate, you know, young minds early on in the piece to like, 673 01:00:13,440 --> 01:00:19,440 even if even if someone wants to get it sparky or get a chippy trade, like the majority of my 674 01:00:19,440 --> 01:00:24,080 friends that do that, they run their own business anyway. And then they need to know, okay, what do 675 01:00:24,080 --> 01:00:27,440 I do with that money? And I think at that point, you touched on before the majority of families, 676 01:00:27,440 --> 01:00:33,200 as I speak to, they're phenomenal. They've done the same thing over and over again, to a point 677 01:00:33,200 --> 01:00:38,640 of excellence for 30 years running their own thing. And one of the most troubling conversations I have 678 01:00:38,640 --> 01:00:44,080 is they just think that they can take what they've been doing for the past 30 years, they get a very 679 01:00:44,080 --> 01:00:48,320 large windfall when they sell their business or retire or something equivalent, a lot of money, 680 01:00:48,320 --> 01:00:53,200 tens of millions of dollars. And then they think they can do the exact same thing in the finance 681 01:00:53,200 --> 01:00:58,480 world. But the first year, if it's a good year, and it's a COVID and everything moves up, they 682 01:00:58,480 --> 01:01:02,960 think they're heroes, they don't need any help. There's always a winter around the corner. And 683 01:01:02,960 --> 01:01:08,640 what they don't realize is the number of variables associated with our industry. And they get confused 684 01:01:08,640 --> 01:01:12,160 and they don't know where to hide. And they go screw this, they toss in the towel and throw the 685 01:01:12,160 --> 01:01:18,640 money in the you know, in an asset class, they think is safe. But yeah, I just think we don't 686 01:01:18,640 --> 01:01:24,480 agree that just a pathway for you know, education or just the ability to find information. Yes. 687 01:01:25,120 --> 01:01:31,600 So important. Yeah. So financial literacy is just a fundamental life skill. Yeah. Like learning 688 01:01:31,600 --> 01:01:40,320 English or basic maths and so on. So and it's not that hard. So yes, there should be attention given 689 01:01:40,320 --> 01:01:48,560 to that. And then yes, help people to understand, you don't have to do it yourself. If you're 690 01:01:48,560 --> 01:01:55,280 an expert in your trade or your field, you don't have to be an expert in investing. You just have 691 01:01:55,280 --> 01:02:01,920 to know how to find the right people to help you. It doesn't happen often enough. 692 01:02:03,920 --> 01:02:08,880 Yeah, I completely agree. So with that being said, Ian, look, it's been a pleasure having 693 01:02:08,880 --> 01:02:13,120 you on. I've learned a lot from today and hope everyone has felt the same. 694 01:02:13,120 --> 01:02:16,880 Yeah, I've enjoyed it. I'm sorry if I've taken us off on a few tangents. But 695 01:02:16,880 --> 01:02:21,760 look, that's the reason look, in all honesty, Joe Rogan has been such a fantastic person for 696 01:02:21,760 --> 01:02:26,960 the podcast genre of these long format conversations. This is the most enjoyable part when you go on 697 01:02:26,960 --> 01:02:30,960 tangents, and then you're not in particular places, but it's all associated with financial markets. 698 01:02:30,960 --> 01:02:34,480 It's so interesting. And again, I really thank you for your time, Ian. 699 01:02:34,480 --> 01:02:37,840 No, you're welcome. You're talking about things that I'm passionate about. So that 700 01:02:40,480 --> 01:02:42,720 isn't that the keto a happy life? 701 01:02:42,720 --> 01:02:45,360 It is. Absolutely. Yeah. 702 01:02:45,360 --> 01:02:47,440 All right, Ian, have a great day. 703 01:02:47,440 --> 01:02:48,880 Great. You too. Thanks a lot. 704 01:02:49,440 --> 01:02:50,240 Bye. 705 01:02:50,240 --> 01:03:18,880 Bye bye.