TPG N.V.

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TPG N.V. (TP): Company Profile, Stock Price, News, Rankings

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TPG N.V. | Fortune

TPG N.V. (TP): Company Profile, Stock Price, News, Rankings | Fortune

Steve Ellis, A Managing Partner, TPG's Rise Funds Kentaro Kawamori, Chief Executive Officer, Persefoni Moderator: Sheryl Estrada, Fortune

Impact Initiative 2024: Tech Transformation - How Startups And Growth Investors Are Driving Change

Photography by Rebecca Greenfield/Fortune

Conferences

Thank you, Steve and Cantaro for joining us today. Thanks for having us. Great. So I'm gonna dive right in with the first question to you, Steve for almost a decade. TPG rise has been investing in companies that drive environmental and social impact and change while making money by virtue of what they do um from the lens of private equity and for profit capital. How are you identifying and supporting companies that are using tech to tackle some of these large problems? Yeah. So first of all, it's wonderful being here, let me maybe start just with a quick definition of impact investing because sometimes it gets conflated with ESG they're, they're siblings, but they're different. Uh It uh impact investing is about finding companies that by virtue of what they do to make money are creating net positive social and environmental good. And while ESG can be a policy and a set of practices that apply to every business, there's only a subset of businesses that are inherently what we call co linear meaning that their business model is focused on not just making profit but in creating social and environmental good that can be measured that's sustainable. And that is ultimately going to address some of the world's biggest problems. So we start from that premise and when it comes to identifying where particularly technology can make a difference, we start with the fundamental premise of access that uh if you think about really the cornerstone of impact investing is finding ways innovative ways to improve access to uh really valuable resources and services that underserved populations have difficult time gaining access to. So if you think about it, um education, access to quality education, access to affordable and high quality health care, financial inclusion, quality jobs, food security, uh clean water, clean energy, even access to uh a sustainable environment. Those are all problems that can be addressed through commercial businesses. And oftentimes the innovation, in fact, most of the time, the innovation is anchored on the application of technology. Um Obviously, software has enabled an enormous um amount of innovation in areas like education uh in Ed Tech for K 12 adaptive personalized learning in the health care world. The advent of gene therapy, cell therapy, advanced diagnostics have dramatically reduced the time it takes and the cost associated with diagnosing and treating illness. Uh Even in material sciences, we've found ways now with advanced technology to dramatically reduce the cost of solar panels to find ways to create clean hydrogen, clean ammonia. We've even found ways to convert municipal waste into usable thermal plastic that can replace petroleum based solutions. So we start with these, what we call impact pathways that are driven by this view of creating access. Um And then we figure out where technology can inflect the ability for a business to grow and to expand the footprint of its impact. Now, you do this all over the world. Um Are you learning best practices based on different regions? Uh how to u utilizing technologies that can maybe be applied to other places? Yeah, I mean, it's, we are a global fund which is a little bit unusual. We invest literally all around the world developed and developing markets. And uh one of the things that we've seen is uh is that this application of, of new technologies, it needs to propagate. And interestingly, we're, we're in sort of a de globalizing world as we sit here today, given everything that's happening geopolitically uh and what that's creating is a void. Um you know, there used to be, you know, free flow of commercial ideas and intellectual property and talent and that's all now being restricted a little bit. And so one of the things that we found is that we can be um a conduit for that, a very efficient conduit for being able to take some of the best practices from the developing world that are doing technology skipping, bringing those back to more mature developed economy, uh business models and vice versa, bringing advanced technology from the developed world into the developing world. So we've seen that cycle accelerate, you know, very meaningfully just at a time when the world seems to be retreating from the power of globalization. Thank you, Steve. Um Cantaro, you're the CEO of Persephone and also a co-founder and one of TPGS portfolio companies. Uh Can you talk a little bit about why you started your company and how you are leveraging A I to help uh carbon accounting and corporations? Absolutely. We talked about it a little bit, you know, when we started persephone almost five years ago now, which is just wild. Um We, we really looked at the problem that we solve a little bit differently than most. And thankfully, Steve saw that along the way and decided to, to endorse that strategy. And that was looking at what was traditionally environmental disclosures, which had been the providence of, you know, I think state, local regulators, the EPA and heavy industries. And we really saw that becoming a financially material topic both for investors like Steve, for example, um or in the corporate side. So us as a oops as a portfolio company at TPG, we don't just build a tool to help companies do that. We actually do what we say. And so as part of the rise funds, for example, we provide carbon and climate disclosures to our investors like Steve. But the core of what we looked at was all this data that's required to calculate a carbon footprint. Looks a whole lot different than traditional environmental data for a lot of people. And what that means is we had to build a system that can take a huge variety of data sets by all accounts, the largest range of diverse enterprise data we've ever seen in a single system of record, be able to ingest that transform it and then publish it in a standardized format that could, that could meet regulatory scrutiny. You know, that was really the vision that we laid out, which was quite different than the rest of the market. That was saying, hey, you know, if you look at the previous cycles of ESG and sustainability, that was really CS R was driven by marketing and reputation. Now it's really become a financially material topic sitting very, very often now in the office of the CFO as well. Yes. And uh with uh SCC regulations in, in uh financial reporting when it comes to uh uh climate uh initiatives, um especially scope 12 and three. how do you explain to companies, you know, especially scope three? I know that's an issue that uh a lot of companies are grappling with. So can you tell us a little bit about that? Definitely the, the disclosure regulations that are either here already or about to be here. Topic, number one that, that we deal with in our customer base and like the, the, the advice that we have to dispense is quite diverse because companies tend to be in such a, a broad range of, of stages in this journey, right? And it's best to think about sustainability and climate as a journey. And, you know, it doesn't matter if you've set an S BT I target first. And now you're sort of realizing like we saw on the panel before, how do we get there? Maybe we have to rethink these targets or if you're just starting out and you're looking at, how do I set a target? What does good look like? You got to start with the fundamentals of understanding what you have and where you're headed. That's where we focus a lot of our time and advice. You know, there's a, there's a rightfully so a lot of excitement and desire to get to the end stage of that. So for example, in private equity or in Corporates, there's a lot of uh a lot of discussion about value creation. How do you, how do you create value from impact and sustainability and climate? But for a lot of people, I mean, look at what's happening in the news today. It's about getting the basics right first, value protection. But we're, we're dealing with a massive hurricane right now. We have people in our business that are out from that event. And so we, we very much advise our, our customers and our prospects that we deal with disclosure isn't just about sending something to a regulator. It's about understanding what you have and where you're headed. So you can actually manage the thing that you're trying to manage against. Yeah, I would say uh one of the things that has become very, very clear as we've gone through this journey is that um the market has been waiting for a lot of regulation to create top down um mandates for reporting. And obviously, those mandates have been more fragmented. Uh They've been delayed, they've been controversial. Uh And, but what we've seen happening now increasingly is that um people realize that they're going to need to be accountable for their carbon footprint and that they have going to have to have a, an accounting system to start so that they can understand exactly where their footprint is. 12 and three. Uh But more importantly, they're going to need actionable information from that system that gives them the ability to manage their footprint. And that's what is seems to be missing. A lot of people are getting the initial footprint. Um I like to call it sort of the, the blueprint of the house, but we need working drawings, right? We've got to understand specifically how we're going to address that um that footprint. You know, whether it means mitigation approaches, whether it means going into the uh voluntary uh uh carbon markets. And that's the, that's the tie that has, has been missing. But we're beginning to see now sort of an organic tipping point where that is um companies are doing it on their own. I am going to open the floor to questions in just a moment. If you have a question, you can raise your hand and someone with a mic will come. Um We can start now, this is Kwara Sheikh from IBM. Um When we look into the SCC regulations around the climate change and when we look at the VC investment, typically the venture capitalists have got uh high risk uh more patients long term orientation attitude. But uh the, we don't have the same mindset for the companies which are more short term oriented because the culture has to change uh for the new era where they need to be more long term focus. What advice would you offer if you are part of a business round table? Uh So that uh the CEO S can infuse the VC mindset where we, we just don't necessarily look at the SCC climate regulation standpoint, but also for the value creation for all stakeholders. Well, that's a, that is a great question and, and uh I'll start in and Kor will finish. Um This is one of the biggest challenges that we face, right? Because this concept of what is the method of change management to get organizations to stop just responding to the stick, which is regulation and start responding to the carrot, which is all the extraordinary benefits that flow from embracing this kind of management discipline and in principle, um and you know, it's in my mind, the most important thing is to just be crystal clear with how this aligns with your broader business objectives, to create the linkage between doing what's right from a sustainability standpoint with what's right for the important stakeholders in your business, whether it's your shareholders, whether it's your customers, your employees, and really spending time to understand what they want, what they need, how they measure it, how they uh how they metabolize whatever information or um or evidence that you provide them for what you're doing to contribute to a more sustainable world. And that's just good business, right? I mean, you don't want to be working against the grain of the organization. Let's take that focus on commercial success and profit motive and use it to our advantage to accelerate the change. Yeah. And I think the the regulatory piece is such a bear in our world, right? It's both this immense opportunity for acceleration and standardization and you know, a whole bunch of things in between. But at the same time, you know, if I come back to your question on how do you, how would I talk to a VC or a corporate board and sort of infusing the VC mentality, I would say, you know, building a business off of regulation alone is very risky. Like you need to look at what are the intrinsic macro forces happening and is there an underlying set of drivers that's gonna make this business or this product? Successful regardless. And a great example in our business, you know, Steve and I are very aligned on the vision of persephone, obviously as as investor and entrepreneur and our business is going to benefit massively from regulation, but it hasn't needed it yet. You know, we're seeing a huge groundswell right now, for example. So you have some some data to tie to this. We released a, a free to use first of its kind, what we call a premium type product that allows any company to do scope 123 and accounting completely free. And we've seen 3500 sign ups in six months. There's nobody's signing up because the regulation is live, they're signing up because their investors are asking for these disclosures, their customers are asking for these disclosures or some other stakeholder is forcing them to do this. So there's these intrinsic market forces already creating this market. So it's a small microcosm coming back to that, right? I think you have to look at macro developments and trends far beyond the regulatory side. And then regulation is either can go both ways, it can be a huge accelerant or it can be a huge inhibitor. Um So Cantaro, if you're a company that is having to do this type of, of reporting, um There's a lot of data, there's a lot of different technology that you can use. How do you actually figure out what is right for your company in terms of if I'm like for us helping the our customers. Um you know, fortunately for us, there's a very, there's a gold standard in our world, but here is probably familiar with the greenhouse gas protocol and it's sort of like what gap is to financial accounting. That's where the complexity starts, right? So the, the greenhouse gas protocol documentation in itself is over 600 pages in its various iterations, which is nutty. The best example I give to people is uh if you, if you really like have trouble falling asleep, go download the IRS tax code. And the IRS tax code is sort of like the greenhouse gas protocol uh in our world. So we, we have to have an immensely talented set of individuals that from a support and advisory perspective helps our customers interpret that our software has codified a whole bunch of that, right? So there's, there's a patterns and there are data driven ways that we can extrapolate what it is. You should be reporting that tends to be question number one to your, to your point on scope 12 or three. A lot of people say I know I need to do this, but there's 15 subcategories in scope three, which one's actually material for me. And there's various ways to answer that the data informs that the methodologies give the prescription of how to actually translate that data from one form into the other. And that's what our software does that's what our team does every day. Um And, you know, we've been fortunate, you know, we've been able to invest a whole bunch of cash into R and D frankly, which has allowed us to have a very strong set of IP both in our system of record. So the underlying software um workflows as soon as you come in, actually, we'll tell you here's what's material to you, how here's how you calculate this and then from an A I component, massive opportunity, massive Steve and I geek out about this all the time because where especially in the GP T world, where software really excels is when you have human readable language. And there's a great amount of, of data that sits in a company that is human readable that can now be read by machines. But in the past wasn't meaning a lot of data that sits in a SQL database, for example, isn't human readable, right? It's machine readable. But now the GP T world has really enabled a whole new set of use cases where we look, we can look at things like uh supply chain data in a whole new different light. When companies are getting small invoices from small vendors that say, you know, I was with a car manufacturer in Italy, you can take a guess which one and getting material welded at small shops and literally they're getting handwrit notes that now can be transcribed and read by A I which wasn't possible before. Yeah, I think just one of the things that we're seeing is it's a classic technology playbook which is to leverage the power of virality. And what's happening is um you know, uh many companies scope three is some other company, one, many companies scope one and two are other companies scope three. So if you can start to get the flywheel spinning where people are addressing the question of their carbon footprint on a common platform with a, with a really well designed and curated data layer. That's when you can start to really accelerate the adoption of practices that change behavior. Well, we're at time, that was an interesting discussion. Thank you so much, Steven Cantaro. Thanks for having me. Thank you.

Anilu Vazquez-Ubarri, Partner and COO, TPG
Dave Wheeler, Chief Operating Officer, New Balance Athletics
Moderator: Phil Wahba, Senior Writer, Fortune

COO Summit 2024: All Eyes On The Coo - The Evolving Role In A Time Of Transformation

Why don't we just kick uh get right into it? The panel is called, this uh session is called All Eyes on the CEO the evolving role. How has the coo role changed since the peak of the COVID crisis? I don't wanna say it's over COVID is still running around but you know, we're, we're not at those peaks anymore. So for you, how do you see the profession and the role uh having changed? Yeah. Um Hi, everyone. Um Thanks for, for being with us. Um I think that um the last six years that I've been at TPG, not all of them in my coo role, I've hit on an enormous um level of transformation. Some of it has been COVID and things external and some of it has been our own growth. So I think nothing is the same. Um And I think that the COVID lessons, I think we have absorbed and incorporated and I think that they're here to stay. I think the most fundamental change is that everything happens at the same time. So during COVID, you had to solve COVID, but you were still operating a business. So to me that's, that's the new normal and I operated very differently according to, uh certain. How about, how about you? I think your role changes a lot. Um, certainly has changed a bit. Right. So, it's been a lot of turmoil, certainly since March of 2020. Um, and the two words that we really stick to is agility and speed, you know, being able to detect the issues sooner and the speed to then attack and mitigate those issues. Um And so that's been super important to us. We've doubled, almost tripled in business since then. So it's been a not only managing through geopolitical issues, but also scaling up at a significant rate um and innovating at the same time. So a lot of complexity happening all at the same time. Well, we're gonna come back to, to each of your experiences. Um But, you know, it's, it's uh I cover leadership at uh at Fortune and, you know, you see more and more coo announcements and CEO S who were coo s and for a long time, I think a lot of people would think of the coo role as well. OK, they're getting the stuff done, but, you know, um they're not very big picture oriented, but now what obviously a lot of CEO S have ended up in the corner office. So I'm just wondering, is the role um more strategic now for a company than it used to be or, or should we still sort of see it as it's tactical and it's, you know, the essential stuff getting done. Um And if so, uh how does, how is it blended into how the a company run strategically? I mean, I think that tactical is commercial. Um you know, if you wanna grow, you have to really be very deliberate. So I think that it's been a misnomer to assume that because there is an operational plan that you therefore are not being strategic. I think that that's a myth. I think all of you know that because you know, not like you go through your day and you say now I'm gonna be very operational and let me go to this other meeting and then turn it into strategy. Um It's a lot more dynamic than that. And I think also the, the functions that go under the coo vary for all of us. Um But those have also tended to expand. And so we're all closer to where the business strategy is being created and ID, and it just has to actually be able to be executed on. And I think that was a big disconnect before that when you have a separation of what the infrastructure needs to be and is beyond table stakes is actually what's gonna make you be the firm of five years. You know, I have a rule with my team that no one can come to a meeting with a decision or a solution that works for this year. It has to be something that grows with where we're going as a firm. And I think that that's the reality of our roles today that you're really creating the path for the next 5, 10 years. And how about a new balance when your CEO says, oh, we've got from 2 billion to 5 billion. So make more of it happen and you have to be the reality check or sounds so easy. Yeah. Right. Yeah. No, I think we keep it into two categories similar run the business, transform the business. And so, um you know, we fortunately back in 2019, created five key pillars of our strategy and everything flows from that. We haven't wavered much from there. And so we have key initiatives that spread out across the company. My job is to make sure operations has our fair share and that we're all in unison as we transform the company. Do you bicker with your CFO a lot? Um I would say we make a good business case. We don't always agree on the financing, but fortunately, in a growth environment, it's been a pretty good relationship. Um Well, just to uh to add to that question, how about the role in corporate culture? What is the role of the coo in a corporation? Yeah. Well, I, I have a very biased um answer to that because I actually came to TPG as the C HR O. But the other reason why I'm biased is because we produce nothing other than humans with great ideas and that our strategic partners. So for us, if the base is like where people need to wanna come and work for us as opposed to the many other great alternatives. And for us, culture is strategy, it is the equivalent of strategy. This is not just how people feel about working, but it's actually how we get things done and how we grow. And so for us, there's a lot of intersectionality, you know, you asked about the CFO I cannot get much done without having the partnership with my CFO um or of my general counsel by the time we're completely intertwined and no one can move very far without having a partner that is gonna support them and that is gonna see something that you're not seeing. So for us, um you know, we are also very entrepreneurial culture. And so to your question about like double, we've do more than doubling assets on their management and in people. And so given that the people are the center of what we do, it's very important that we're consistent and persistent about our culture. Likewise, I mean, we're privately owned. So a lot of family values um are important. So I'm kind of in the same box as a CEO and the head of hr I mean, my job is to role model and drive culture every single day because that's how we create that entrepreneurial kind of innovative spirit, super important to us and communicate that to everybody in the company constantly. Yeah, really role modeling is the most important. I think it's the most effective for us. And, and I make sure that all of my direct reports and everybody in the team really reflects that, you know, we have integrity, teamwork, total customer satisfaction, everybody gets that. And it's part of the role also to help people in other functions understand the complexity of the operation for sure. Yeah, because it sounds easy, right? You know, like uh double the number of new models you introduce more stores or, right? It, it, it can all sound rather easy. But um you talked about uh you know, coming over from ach ro role. So let's talk a little bit more about the unusual career trajectories that we're seeing. You were C hr O elsewhere, you know, for example, at, at Target, now they've had two coo s who had been the CFO before and, you know, I had my stereotypes, I'm like, how does somebody who's a CFO and is good at spreadsheets and saying no, you can't have that money um good at the technical aspects of coo of being a coo. So um I mean, I think that speaks to the evolving role, but tell me a little bit, let's start with you on, let's talk a little bit about C hr O which you have an idea of what that role is and how it prepares you for what you're doing now. Yeah, I mean, I have the benefit of having, um you know, been interested in doing things that I didn't know much about uh for a while. So I started as a lawyer as a corporate lawyer and then moved into um the human capital world leading into C hr O. So I have personally gotten used to quite frankly having to be a student of that next step. Um And I wish I could say I had planned it all along, but it was really because all the organizations I've been in have been organizations where they allow you to go and explore things. So I think as, as cultures also in our firms, I think it's really important to give exposure to people to areas beyond what they're doing currently because you don't know what that person may end up doing for you. Uh But I think that um those changes and those transitions also put you in a situation where you're gonna have people working for you that know more than you. And that's also incredibly helpful to have those experts and for you to learn and learn how to lead and guide without necessarily having to substitute their expert knowledge on things. Um And David question for you. So um obviously like a lot of consumer brands, uh and we can call you a retailer, you have your own stores as well. Um With COVID, you know, for a while, uh everything was really a mess and then we had the supply chain chaos last year. I mean, there's always something and then you narrowly avoided the port strike drama this week, right? Or last week. So, um for you, how has the role changed? Vis a vis what it might have been before COVID? Yeah, I think it's, um you know, the innovation part of it is um a critical element and that kind of falls I I have a collection of different functions. So it's like traditional supply chain from, you know, planning, sourcing, making delivery, but then also product development, which is very, very important for the effectiveness of my organization because we get to take the design from, you know, pie in the sky designs, really exciting stuff, but actually develop a product that we can manufacture. Um But the innovation portion of it has really escalated from an A I perspective um being able to develop a new er P and supply chain planning suite so that we can better do touchless planning and be more effective and be able to do scenarios where we can anticipate what might happen and therefore be ready with a playbook of Plan B, plan C. Um That isn't something that we did, let's say prior to COVID. Um because it was, let's say relatively stable back then, now we've seen so many different events occur and we just strengthened up on the innovation side of systems as well as overall processes so that we're more resilient and can respond to those issues as they come about. Because as you said, it happens every month, every year now in their big events. So we expect that going forward. Um I'm gonna continue going, but I want to open it up to the audience. We'll have somebody here who has a Mike. So please don't be shy. We're all to new, good group of peers here. So um I'm gonna ask another question, but uh raise your hand and Mike will come to you. Um So just quickly following up on those questions. So um I have to admit the first time I saw TPG, I was like the coo why does TPG need the coo you know, it's like their portfolio companies will each have AC O but obviously your role is different and, and the company just made, the firm just made uh an acquisition. So tell me a little bit about your, what's a typical day for you anyway? Yeah. Um So TPG is an, a firm. We're headquartered in San Francisco and Fort Worth and that's very important to the origin and the culture of the firm, very tech, um oriented, health care, oriented in our private equity business. We are now diversified in acquisition last year, Voice of Angela Gordon, um a credit business and the real estate business. Um And so this is really where this industry is going. So I because of my legal background as a corporate lawyer, I was very involved in the transaction with the D team. And I also lead the integration, which we believe will be a multiyear integration. And it's not just the operational part but actually the growth part. So I spend a lot of time on thinking about growth organically, which has been the majority of the growth of TPG. We have over 200 billion in assets under management. And up until this transaction, all of that was organic, uh which is actually pretty rare. Um and a pretty fast paced way of growing. Um I spend my time in three buckets. I do lead uh one of our investing strategies. So one of those new businesses, so I can identify with someone who comes with an idea. Uh It's a seeding and staking um strategy, then there's the growth part of it and then there's the every day. So on every day I spend my world, you know, kind of revolves around those three main areas and then the occasional thing that surprises you. Um And, and how to communicate about it. The crisis, sometimes, sometimes only a few times I've, I've come across actually, you know, I think that that's, you know, one thing that people don't talk as much about in terms of the role of the CEO O because you're involved in so much that you can probably see a crisis coming. Um You probably understand who you need to pull in, who you need to be the connector to make sure that everyone that needs to help has their marching orders and have the support that they need to act fast and one more follow up for David. So um for you, what's the, you guys are doing a lot? You're getting much bigger, you're going further into apparel, you're doing more DTC, more of your own stores. you also produce about 20% of what you sell stateside. So for you, what's the biggest operational challenge for the company operational challenge? I think now expanding is, is as challenging as shrinking. It's just more fun. I would say, you know, it's like, how do you make sure the product has the right quality that we stick with our ESG goals? Um So many different issues, right? Um So growth is a challenge. No question. I would say policy is also a big one for us trying to stay abreast of what's coming around the corner. Like you think about all the European policies that are coming at us. How do we make sure that we're compliant so that we can continue to sell and be a good corporate citizen? So policy is huge for us. So at the in February, I wrote a story based on research from Spencer Stewart. Um you know, we're a little, we like drama in the media and, and, and it was like they were finding that coo S had come back and supplanted CFO S for uh in terms of the other c speakers who end up uh in the corner office most often. And, you know, we had quite a few coo s in the last 12 months that who became the CEO S of the company Costco for one uh Netflix, um the one of uh the CCO one of the Boeing units also became a CEO somewhere. And so I'm just wondering, uh does this make sense to you? Um What's, what do CEO S have that others, don't, do you think? Good question. Do you want to take that one? Yeah, I was gonna say, um I'm pretty happy with my current role. I'll say that. So I'm not aspiring to become the next CEO if it happens, great, but certainly just knowing how product is made and having overall purview of that is um you know, something that not all executives have in, in the various C suite um roles. And um yeah, I just think it takes a certain uh a mindset and a personality to make it successful. And if you're successful as a coo you could be a successful CEO I'm, I'm not surprised because of the scope of the role. I think that the most important thing is not whether that's the new trend or not, but is the possibility. Uh And I think that it comes back to how each of us do uh our current job um and making sure that it can be that exposure to if that is what's best for the firm that at least people are positioned to do that. I think, importantly, thinking about the generation underneath us because it might not be us, but it could very well be someone who is training uh with us. And I think that that's the most important thing, right? You're a leadership uh focused person and we don't know where the next CEO could be, it might be right underneath us. And if we have that responsibility, that in fact, we're training that future leader, we should be as expensive as possible. Um I mean, it's worth noting too. Uh you know, that article just kind of looked at the last job they had. But when you look, take for example, the new CEO of Costco, he had been the chief merchant too. And I, so I think basically the takeaway is, is you, you need to get skills in all sorts of different areas. And then uh that, that runs you out as an executive. So speaking of skills, what does the CEO of today, uh what new skills does the CEO of today need uh that might not in the past have been uh cultivated as automatically or that are required. I, I think um being a quick listener um and gather information quickly and they're all kinds of way from A I to actually talking to people and not losing that balance. I think that the pace of growth and the pressure on CEO S to grow is generally so in their face that, um, they need to have a way to separate the noise from what they really need to focus on and execute pretty quickly. Yeah, I, I would totally agree with that. I think leading with hearts and minds sometimes gets lost in the mix because there's so much pressure, so much going on, you got to keep that front, front of mind. And I think also going to the geek side of things being a data geek, being an A I geek, not being afraid to roll up your sleeves and getting into the detail because the more, you know, um, the better your teams will dig in as well and make it happen and take some risk, you know, and I think risk taking is super important in today's tech world. No, I, I mean, absolutely. And, and I think, um, um, you know, we've seen a lot of companies get into trouble by not having what you can call left brain, right brain. You know, I think some, some brands in retail got too obsessed with uh operational efficiency and forgot about the core product and making people want it and then sometimes it, so it's, uh, it's gonna be interesting to see. You have to have a new balance. Sorry, you have to have a new balance. Yeah, exactly. There you go. Um, um, I was gonna make a joke about one of your competitors but I won't. Um, so we can stay friends. But, um, last question in these, in these uh, final seconds, how often do you see your CEO, does it? And does it ever feel like you're being called to the principal's office? I mean, we have constant communication, even if we're not in the same place, we travel a lot and we try to divide and conquer. But it's constant whether it's in person, phone, text messaging email. I mean, it is all the time. So you're on speed dial. Likewise, texting constant multiple times a week. In fact, our owner Jim Davis, he's the chairman that's weekly as well. So he's 80 plus years old. Super involved very much into the manufacturing innovation. How do we make more product locally? And so that keeps us busy. Ok. Well, stay busy. Busy is good. So, on that note, join me in. Thanking Andy Lou and David.

Anne Chow, Chief Executive Officer, AT&T Business, AT&T
Edna Conway, Vice President, Global Security, Risk, & Compliance, Azure, Microsoft
Julie Felss Masino, President, International, Taco Bell
Dr. Paula Johnson, President, Wellesley College
Moderator: Lucinda Shen, Writer, FORTUNE
Introduction: Anilu Vazquez-Ubarri, Partner, Chief Human Resources Officer, TPG

MPW Summit 2020: Digital Transformation (No, Really This Time)

Uncategorized

We hear from business leaders on how they are embracing—and enabling—monumental, technological shifts that will alter and hopefully strengthen corporations long after the pandemic is over.

 I've always thought that investing is actually not about what's for sale, but about what you want to buy. So one of the things we really focus on is top down trying to spot trends in the world, in the economy, and then going out to find interesting opportunities within those trends. Number of years ago at TPG, we started doubling down in our efforts to invest in content. One of the areas of content that was actually growing most robustly was live events-- sports, concerts, conferences, so we began looking for opportunities to participate in that trend. Cirque, which people had thought of as a circus in some ways, in fact, was one of the leading producers of live content in the world. And the farther we got into looking at the company, the more we realized the opportunities that lay ahead. Cirque Du Soleil has 10 permanent show, and we have 9 touring shows traveling around the world in 350 cities. We have close to 5,000 employees working for us. You have artists, gymnasts. You have people who come from the world of dramatic arts. You have all kinds of different artistic expression that come together for a show. We have about 250 people working in the shops, which goes from everything to shipping and receiving, textile, store room, sort of library for new fabrics. We have a 3D shop, cutters, and seamstresses, and shoemakers, and hat makers. It's a huge group of people with lots of passion. As we speak right now, we're developing a new show. So when we open the show in Montreal in April, there will be 150 employees that are going to travel around the world all together. In each city that we visit, we will hire an additional 150 locals in order to help us to support the development and hosting our customer for merchandising, and ushers, and food and beverage. A history of being just incredibly committed. It creates for a very vibrant environment in which a lot of different kind of people seem to strive and be happy here. It's obviously a well-known brand. And one of the things we track across our consumer oriented portfolio is Net Promoter Score, or MPS, and Cirque has always been one of the highest overall MPS scores, kind of comparable to Apple, Netflix, others that we'd know out here. What's most unique about Cirque though isn't the high MPS score, it's that it's considered the most differentiated brand. So a brand's standing for something that is truly unique that no other brand is comparable. The organization started in 1984. And Guy and a bunch of street performers got together and developed the first show, which was called Cirque Du Soleil. Took a few years to make the company profitable. The first breakthrough was our first visit in Los Angeles. And then it continues to grow. The next breakthrough was the opening of permanent show in Las Vegas. The company has been booming at a very, very rapid growth. In 2008, like everybody else, there was some difficulty. And then it was getting tougher and tougher for us to bring Cirque Du Soleil to the next level. Guy felt that we needed to have new partners, new shareholders that had the power to bring us to the next level. So today, we're in that position with TPG as the control shareholder, and Fuson opening us China. We've been investing in China for a long time through our ownership of CAA. We've watched the Chinese entertainment markets open up and become hugely impactful in the TV and movie area. Couldn't there also be more opportunity in China for live events? When we put our investment group together to purchase the company, we immediately went out and found a Chinese partner that would join us as a major investor in the company to help make sure that we were making the cultural translation, the business translation correctly. A year and a half later, we have an office in Shanghai. We're going to open a permanent show in Hangzhou. So we're going to have our first touring show starting in November 2017. So all of a sudden, in a year and a half, we have been able to accomplish more in China in a year and a half than in probably 30 years before. You think about investing in a company, the first question you always ask yourself is what don't you change? So we began at Cirque by realizing that we didn't want to change the creative energy and talent that is a core of the franchise. However, we also realized that there was more they could do, and management was in agreement with us. The company historically had not had a head of China. Didn't have a head of sponsorships. Didn't have a head of business development. It didn't have a chief marketing officer. Cirque created this great product that they felt, you know, should sell itself. The reality in the competitive world we're in is you do have to put marketing muscle behind. And that marketing muscle is quickly evolving given all the new social media channels. We needed to build an infrastructure that allowed us to speak to customers beyond the show. We have found out by leveraging the data that we have that consumers actually want to hear from us more, right. They've become a fan. And just like if you're a fan of a sports team or you're a fan of a movie, you want to see a trailer. You want to check in on trades. You want to hear more about it. I'm saying some of the things that many marketers do, but we haven't actually done a lot of that. We had, fortunately for Cirque, it was it was a cult brand for so many years, right. And word of mouth, the crucial word of mouth in any marketers lexicon, drove it. Inspired by the adventurous spirit of freedom and the thrill of blazing your own trail, Cirque Du Soleil Volta. With Volta, we've partnered with Red Ball. It introduces our brand in a new way to new audience. It gets people to look twice. We're going to open an NFL experience on Times Square, so you cannot talk of a better window for an artistic content provider to put together a new experience for customer. So that experience in itself opened the door for Cirque Du Soleil to a new category of experiences that we can develop moving forward in a lot of different sports and in a lot of different cities. We're very serious and supportive about accelerating the pace of development of new shows. Obviously, there was some anxiety, but it didn't last long. Because the people in creation and production are totally fueled by new shows. And that, within a very short period of time, brought stability emotionally in the organization, and now we're at the stage of people get very, very much evaded by the fact that we are accelerating the pace of development of new content. I think the trend society of people wanting to leave their digital world to connect in a live experience is young and still growing. So understanding the particular challenges and opportunities of building a live events business has been hugely impactful for me. Delivering what Cirque delivers around the world to millions of viewers every year is really an incredibly difficult thing to do and do well. And so watching them do that and do it very well has really been a learning experience for me. Where do you see Cirque Du Soleil in 5 years? You know, my wish is that in five years from now, Cirque Du Soleil is considered as the leader of live entertainment in the world. [MUSIC PLAYING] 

Cirque du Soleil: When An Investment Firm Buys A Circus

Luxury

The private equity firm TPG Capital seized the opportunity to invest in Cirque du Soleil and boosted its potential.

I've always thought that investing is actually not about what's for sale, but about what you want to buy. So one of the things we really focus on is top down, trying to spot trends in the world in the economy and then going out to find interesting opportunities within those trends. A number of years ago, TPG we started a doubling down in our efforts to invest in content. One of the areas of content that was actually growing most robustly was live events, sports, concerts, conferences. So we began looking for opportunities to participate in that trend. Certain which people thought of this circus in some ways, in fact, was one of the leading producers of live content world. The farther we got into looking at the company with, the more we realized the opportunities that lay ahead. Cirque du Soleil has a 10 permanent show, and we have nine touring shows traveling around the world in 350 cities. We have close to 5000 employees working for us. You have artists, ex gymnast. You have people who come from the world of dramatic arts. You have all kinds of different artistic expression that come together for a show way have about 250 people working in the shop, which goes from everything to shipping and receiving. Textile store room for a library for new fabrics. We have a three D shop, cutters and seamstresses and shoemakers and half makers. A huge group of people with lots of passion way speak. Right now we're developing a new show. So when we open the show in Montreal in April, there will be 100 and 50 employees that are going to travel around the world all together in each city that we visit, we will hire an additional 150 locals in orderto help us to support the development on dhe, hosting our customer for merchandising and ushers and food and beverage, a history of being incredibly committed. It creates for a very vibrant environment in which a lot of different kinds of people seem to strive and be happy here. Obviously well known brand and one of the things we tracked across our consumer oriented portfolio is net promoter, score, or MPs, and Cirque has always been one of the highest overall MPs scores, kind of comparable. The apple, Netflix, others that we know out here. What's most unique about circuit was in the high MPs score that it's considered the most differentiated brand, so a brand standing for something that is truly unique that no other brand is comparable. Three organization started in 1984 and G and a bunch of street performers got together and develop. The first show, which was called Cirque de Soleil, took a few years to make the company profitable. The first breakthrough was our first visit in Los Angeles, and then it continues to grow. The next breakthrough was the opening of permanent show in Las Vegas. The company has been booming at a very, very rapid growth in 2008. Like everybody else, there was some difficulty and then it was getting tougher and tougher for us to bring service away to the next level. G felt that we needed to have new partners, you shareholders that have the power to bring us to the next level. So today were in that position with TPG as control shareholder and full song opening US China. We've been invested in China for a long time through our ownership of See a, we've watched the Chinese entertainment markets open up, become hugely impactful in the TV and movie area. Couldn't there also be Maur opportunity in China for live events? When we put our investment group together to purchase the company, we immediately went out and found a Chinese partner that would join us as a major investor in the company to help make sure that we were making the cultural translation. The business translation corrected. A year and 1/2 later, we have an office in Shanghai. We're going to open a permanent show in Hangzhou. We're going to have our first during show starting in November 2017. So all of the sudden, in a year and 1/2 we have been able to accomplish more in China in a year and 1/2. Then, in probably 30 years before you think about investing in a company, the first question you always ask yourself is, What don't you change? So we began a search by realizing that we didn't want to change the creative energy and talent is a core franchise. However, we also realized that there was more they could do and management was in agreement with US company historically had not had ahead of China, didn't have a head of sponsorships, didn't have a head of business development. It didn't have a chief marketing officer. Circuit created this great product that they felt should sell itself. Reality in the competitive world we're in is you do have to put marketing muscle behind. That marketing muscle is quickly evolving, given all the new social media channels we needed to build an infrastructure that allowed us to speak to customers beyond the show, we have found out by leveraging the data that we have that consumers actually wanna hear from us more right. They've become a fan. And just like if you're a fan of a sports team or you're a fan of a movie, you wanna see a trailer you wanna check in on trade you want, you want to hear more about it. I'm saying some of things that many marketers do, but we have actually done a lot of that. We had, Fortunately for Circuit was a cult brand for so many years, right and word of mouth, the crucial word of mouth and any marketers lexicon drove it, inspired by the adventurous spirit of freedom and the thrill of blaze your own Trail Soleil Volta with Voltaire, we partnered with Red Bull. It introduces our brand in a new way to new audience. To get people to look twice. We're going to open an NFL experience on Times Square, so you cannot talk of a better window for a new artistic content provider to put together a new experience for customer. So that experience in itself opened the door for Cirque du Soleil toe, a new category of experiences that we can develop moving forward in a lot of different sports and in a lot of different cities, very serious and supporting about accelerating the pace of development of new shows. Obviously there was some anxiety, but it didn't last long because the people in creation and production are totally fuel by new shows and that within a very short period of time, brought stability emotionally in the organization and now where the stage of people get very, very much evaded by the fact that we are accelerating the pace of development of new content. I think the Trend society of people wanting to leave the digital world to connect in a live experience is young and still growing so understanding the particular challenges and opportunities of building a live events business has been hugely impacted. For me, delivering what Cirque delivers around the world to millions of viewers every year is really incredibly difficult thing to do and do well. So watching them do that and do it very well has really been a learning experience for me. Uh, you know my wishes that in five years from now Cirque du Soleil is considered as the leader of live entertainment.

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