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Nichola Pease

The chief executive of JO Hambro believes boutiques now face a growing challenge with bigger companies finally responding to the threat of small start-ups but in three years her firm has grown dramatically but she says the business is still climbing and has not yet reached base camp. Interview by Nicola York.

Content over packaging is Nichola Pease’s philosophy when looking to recruit new members to the JO Hambro fold.

By this, the chief executive of JO Hambro means the boutique has always picked managers on the basis of their performance, even if they are relatively unknown. Pease feels this has paid off.

In the three years since it was set up, the retail arm of the business has grown from 80m to just under 1.5bn, now making up half of the company’s assets.

The Dublin-based Oeic business launched in November 2001, setting off with optimism in a difficult market, and Pease says the key to success has been attracting the right people and sticking to principles.

This is an integral part of the JO Hambro philosophy which Pease says is very much about aligning the interest of the investor with the fund manager, hence the company was one of the first investment houses to introduce performance fees and the capping of funds.

The philosophy seems to work. Pease talks of the “great mutual respect” between the managers and their passion and belief in what they do. “People here have different styles. as I say, we have more than one author in the library, we do not just have different volumes of the same author.”

Pease thinks there has been a generational switch in the type of role that people want to take in a work environment. She thinks people want to have a more active part in the business as well as managing their fund.

“I think there are quite a large number of people of this generation coming through who like the idea of being able to affect the business and have entrepreneurial views on the way they want to approach this.”

Although Pease says she is constantly “looking up the hill”, she does feel the company has reached “base camp”.

She says: “Things have become a bit easier, despite the fact the big companies are fighting back well and their remuneration systems are more generous than they were three to four years ago about tying people in.”

Fund boutiques will continue to flourish, she thinks. In her experience, people rarely move from a small company back to a big company, another part of the generational shift of people wanting to feel as if they are partly equity owners in businesses.

There are two barriers to entering the retail fund market as a new player today, she says. This is because there is more choice for the fund manager and the big companies are locking in people more effectively.

“If you are a fund manager with a great record and you are looking to join a boutique then I think you want someone who is a bit established now and can show you a good record of raising money and that they provide a good environment. Therefore, setting up completely from scratch is, I think, reasonably difficult, but not impossible.”

She describes her team and herself as “pretty self-critical” and thinks it is important to reflect on events honestly. The company has a management meeting every other week and part of this is spent assessing what challenges they face and, when necessary, setting their goals for the next quarter.

She admits that JO Hambro needs to build on its distribution and says they are working on this at present. “A good business has breadth to whatever it is doing and we have got a reasonable breadth developing on our fund management side.”

By the end of March, the boutique will have about 10 funds on its Oeic platform with an increasing number onshore, as well as the original offshore funds. Pease says the company also needs to work more with the life and supermarket platforms which she sees as a “good challenge”, admitting maybe they could have done this earlier.

She believes that it is getting harder to find good people. She interviews two or three people a week and hires only two or three a year – an indication of how much time she invests in finding the right mix.

Pease says it is a challenge to retain the boutique culture which she believes is a hard term to define. “One is trying to create somewhere which is a non-political environment with very clear remuneration, very clear incentivisation which aligns the interests and people who really care and are passionate about the business. Those things, whether we have extra assets or not, I do not think will ever be destroyed.”

Despite being in a male-dominated industry, she claims. “I always just believed that if you were good at what you do and you were useful, then everybody was going to enjoy working with you and you were going to do well and that essentially for me has worked out.”

To unwind after work, Pease spends a lot of time with her three children and enjoys walking, reading and playing the piano. “It is all about having a contrast really. If you are in a frenetic busy day, you want to do something that takes you out of that.”

Looking to the future, Pease says she believes in continuing to be brave and take risks with the business. She is stresses that getting the work/life balance correct is very important. “I do not believe that success is in power and money. I think it is a milestone if you do well and get to the top of a company but I think that having a balanced life is key. As the company gets bigger, the challenge is how one manages that.”

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