Breakthroughs on the Buy Side: Robert Stark
Breakthroughs on the Buy-Side
Robert Stark
Head of Investment Management, Americas at Nomura | Chief Executive Officer of Nomura Capital Management
Robert is an asset management industry veteran who came to Nomura in April 2022 and was previously Founder and CEO of Alterum Capital Partners. Robert has also held senior management roles for Russell Investments, J.P. Morgan Asset Management, and FS Investments. Robert started his career in management consulting at McKinsey, where he was a partner and mostly worked with asset management firms across Europe and North America.
Nomura has realigned all of its asset and investment management capabilities in the Americas under Nomura Capital Management (NCM) which integrates firm’s public and private credit offerings to maximize growth opportunities. NCM will take on the private credit business which we really see as a once-in-a-lifetime opportunity to build private credit investments from scratch that has the backing of a large financial institution; and the 30+ year old public credit business of Nomura Corporate Research and Asset Management (NCRAM), which will remain independent as a public credit boutique. Nomura is investing heavily into its investment management business here in the U.S., so you should see a lot from us in the years to come. And the more we grow, hopefully, the more we can grow our partnership with Bloomberg.
Q. What are you currently focused on in your work at Nomura?
We have been building a private credit investment arm from scratch within our Investment Management capabilities in Americas. Our product focus is private credit where we invest across the entire credit spectrum including direct lending, asset-based lending, real estate lending, and specialty finance. We’re bringing those investment capabilities to the RIA market, and to do that we are also building a separate distribution team under the leadership of my colleague Steve Schlow.
My role is overseeing the entire endeavor. We started in April 2022 with just two people, but we are at 20 now and I expect us to grow to 25 to 30 people over the next 12 months.
I also lead the broader asset management activities of Nomura in the Americas. That includes Nomura Corporate Research and Asset Management (NCRAM), our leading high yield manager that’s been around for over 30 years, as well as our U.S. institutional distribution and compliance teams.
Nomura as a group also holds a non-controlling 41% economic interest in American Century Investments. In that capacity, the firm has two board seats and I’m one of the board members representing Nomura’s interests.
Q. How has Nomura evolved over the course of your time there, and what role has Bloomberg technology played in that evolution?
Nomura hasn’t previously been in the private credit space, nor in distribution to RIAs, so my group is a startup inside a larger firm. We mostly work from Nomura’s office, so it doesn’t look like a startup, but it essentially is.
Nomura in the U.S. is mostly focused on sales and trading and investment banking, so its operational infrastructure — including the types of systems that we use — is geared towards wholesale activities. That’s why we are building our own infrastructure, and why it’s incredibly important for us to have a partner like Bloomberg by our side to help us, especially in regard to the portfolio management process all the way through middle- and back-office implementation.
The current environment is also an accelerator for larger trends in the asset management industry — such as the growing interest from investors into private markets, for example, and the shift into more institutional-like portfolio construction.
Q. What industry trends are most impacting your work and the firm right now?
The macro environment we are in [is having a positive impact]. Heightened interest rates and heightened inflation, although it’s coming down, are impacting how we think about portfolio construction and how to help our clients achieve their goals. We believe this is a great environment in which to invest in private credit and diversify away from the public side. The current vintage presents a great opportunity, especially if you have fresh capital to deploy.
The current environment is also an accelerator for larger trends in the asset management industry — such as the shift from public to private markets, for example, and the shift into more institutional-like portfolio construction. That should lead to a “barbell” — with one side of the portfolio continuing passive, low cost investing, through either ETFs or index funds on the public side, and the other side of the portfolio making private market investments that are continuously growing.
Investors must be differentiated [in private market investments] as well, but they are coming from a much lower percentage base. We are very bullish on the fact that private markets are still massively under allocated in most individual investors’ portfolios, and that should create a lot of opportunity for growth for our firm.
Q. How do you see Nomura and Nomura Capital Management evolving over the next five years?
We will continue to add investment capabilities to our platform. We recently brought in an executive from BlackRock — his name is Steve Kavulich — who is going to run our opportunistic private credit team, so we’re getting deeper into investing across the private credit spectrum. That allows us to create more products that are geared not only to accredited investors — like our first product, an interval fund, is — but also to qualified purchasers and institutional clients.
The implementation of that effort could come through different vehicles, whether traditional private GP/LP drawdown funds or other structures such as non-traded BDCs, non-traded REITs, and the like. But it all starts with adding more investment talent and capabilities to our platform. My partner and CIO, Matt Pallai, is leading the charge in building out our investment capabilities.
I can also see our firm attracting teams or doing team lift outs. We may attract teams in adjacent areas — such as asset-based lending, real estate lending, or specialty finance — or go all the way to doing small acquisitions in those areas. At the end of the day, we are building a multi-credit investment platform that provides private and public credit solutions to both institutional and intermediary clients.
Q. How have you been investing in diversity, equity, and inclusion (DEI) or working to close gender and minority gaps?
This is a very important topic not only here at Nomura, but for me personally. Where you come from affects how you see the world, and having more diversity at the table, more differing views, and opinions, ultimately leads to better results and outcomes.
While we’ve made progress over the last few years, we know there is still more work to be done in this area both here and across the industry.
Globally, Nomura is very focused and committed to driving DEI within the organization. Our executives are accountable for advancing DEI efforts and increasing focus across advancement, retention, and recruitment.
For me as I’ve built out our team here at Nomura, I’ve been intentional about creating a culture that is inclusive where all of my team members can raise issues, share ideas, and encourage diversity of thought. My approach toward recruiting is to be as thoughtful as possible on how we can creatively source talent to ensure we have diverse perspectives in the organization. It’s important to have a solid foundation which rests on the culture that we are creating and what we are fostering as a collective team.