Interview: Peter-Paul Van Hoeken, FrontFundr
Peter-Paul Van Hoeken, FrontFundr Founder & CEO, tells RE Royalties that his entrepreneurial path started when he moved to Canada from the Netherlands in 2010. After working for the Royal Bank of Scotland, he brought his wife and two daughters to Vancouver, B.C. and spent some time as a consultant for several early stage and growth companies.
He experienced the challenges that young companies face in attracting capital and realized the venture financing space was not using any of today's available technology. In 2013, he founded FrontFundr to address these challenges and take on the opportunity to create a new capital market in Canada.
Name: Peter-Paul Van Hoeken
Business: FrontFundr Title: Founder & CEO
Education: Masters Degree in Economics, Erasmus University Rotterdam
1. What inspired you to work in finance?
When I was studying for my master’s degree in economics and business, finance interested me because it is what makes our real economy work. I wanted to work for a bank, a big one. However, the longer I worked in the world of big banking, the more I asked myself why I was attracted by this industry in the first place. I learned how it is actually a very tricky industry with a lack of transparency, information asymmetry and concentrated wealth accumulation that benefited a small group of individuals and big corporations. Finance and banking is one of the most traditional industries that needs to make the biggest leap to catch up with the progressive world we live in today. My decision to start FrontFundr was the result of a big dream to innovate funding and investing for early stage companies, the biggest growth engine in our economy. FrontFundr was built on the idea to provide emerging companies better access to capital and empower everyone to invest in companies they believe in and share in the upside.
One of my leading life principles is that life is too short so you want to live it to the fullest. I try to follow this principle in my personal and professional life.
2. What advice do you have for others who want to invest responsibly?
Responsible investing in my mind comes down to first, making investments that are aligned with your values and beliefs. Second, making investments only after you informed yourself properly about the risks and potential returns or losses. Third, regardless of how many assets you have, diversify your investments across different types of investments. With FrontFundr, we enable any investors, big or small, to diversify into investments in private companies.
3. What is your perspective on investing in renewable energy projects?
Investing in renewable energy is investing in the future, in the energy transition renewable is the way forward. Investments in renewable energy projects can create an attractive and sustainable yield for investors. While renewable energy projects typically require significant upfront capital expenditures and therefore larger project financiers are involved, these investment opportunities are increasingly becoming available to the wider investor community. In the fall of 2018, RE Royalties listed on FrontFundr, where RE Royalties successfully opened up its private offering to all Canadians before it subsequently went public on the TSX-V.
From an entrepreneurial point of view: Fintech is revolutionizing and changing the world of finance forever. Look where the puck is going, not where it has been.
4. What is your opinion on the value of ESG in companies that you invest in? How do sustainable values influence your decision to invest?
There is an increasing trend, a paradigm shift where stakeholder value goes beyond just shareholder value. We are and have to move toward a model of Shared Value (a principle introduced by Michael Porter in 2006). This means the return to their investors can be measured in two ways—in profits as well as in societal impact. For instance, at the time of the RE Royalties raise on FrontFundr, RE Royalties shared its clean impact with investors so investors could align their values with their investment. Shared value investing represents an evolution in the relationship between investors, business, and society. Ultimately, investors provide the needed capital for corporations, thus they can directly drive ESG in companies.
5. What was your first job and what did you take away from the experience?
When I was about to finish my masters degree I worked with a consultancy firm. As this boutique consultancy firm I worked mainly with mid-sized growth companies and it exposed me to the world of entrepreneurship. While I still wanted to move into banking, I knew that at some point I would go down the entrepreneurial path. After spending eight years in international banking, I was able to bring the two together with FrontFundr: entrepreneurship in finance and investing.
6. Where do you see your personal investing portfolio in 5 years? My current portfolio has a relatively higher risk profile with focus on growth rather than income. After the next 5 years, I see my personal investing portfolio move towards more capital preservation (from growth to income). However, I do believe that even in relatively conservative portfolios there is a place for investment in growth, in emerging companies that will change the world.
7. What do you think is the future of investing in private companies?
Early-stage and growth companies are the growth engine of our economy, driving innovation and jobs. These companies need capital to grow and thrive. Opening up the private capital markets to the wider investor community, will unlock an entirely new pool of capital. Democratizing the private capital markets enables the public to share in the wealth that is being created by private companies. On the other side of the market place, there is an opportunity to provide the public access to invest in early-stage and growth companies they believe and like to see succeed. That includes companies that contribute to the triple bottom line; people, planet, profit.
Connect with FrontFundr
Social Media: https://www.linkedin.com/company/frontfundr