Profile: Garena's Nick Nash

It was an option that Nick Nash had never even considered. But once he heard the offer he knew he couldn't turn it down.

After more than a decade at General Atlantic (GA), most recently as head of the firm's Singapore office, Nash was preparing in 2014 to return to New York for the next phase of his career. Then in December he was invited to lunch by Forrest Li, founder and CEO of consumer internet platform Garena.

Nash had a long relationship with Li and Garena, having led GA's initial investment in the company's Series B round in 2014 - which was also the firm's first investment in Southeast Asia. He had helped Garena's leadership on a number of occasions, advising on strategic investments and acquisitions in the region. Li's determination not to lose that relationship led him to offer Nash a job as Garena's group president.

One of the pieces of advice that I give to friends and former colleagues in private equity is that at some point in their career they absolutely must do what I've done, and spend at least 3-4 years in a senior leadership position in a high-growth company

"Forrest was incredibly persuasive and said, ‘Look, you can go back to GA and help do more deals out of New York, or you can stay here as my partner and help me build what's going to become the great internet company for the region,'" says Nash.

The offer was a surprise, but as Li explained, it made a lot of sense. Not only was Nash already familiar with the company and its management, the job of expanding Garena was similar enough to that of growing GA's regional business that he would not be jumping into the deep end completely unprepared.

Having talked it over with the management at GA and received their blessing, Nash called Li to take the offer. Just over a year later, the experience has changed him more than he could have imagined.

"One of the pieces of advice that I give to friends and former colleagues in private equity is that at some point in their career they absolutely must do what I've done, and spend at least 3-4 years in a senior leadership position in a high-growth company," says Nash. "It completely transforms your perspective as to how to invest, and more tactically what are the right questions to be asking when you're investing. So I wouldn't trade this experience for the world; the learning has been phenomenal."

The move away from private equity was a huge step for Nash, who had worked at GA since 2002. It was only his second job, after a stint as a management consultant with McKinsey & Company in New York, since graduating from Harvard University in 2000 with a degree in chemistry and physics. Despite his lack of experience, Nash found the GP to be a good fit, thanks to the atmosphere at the firm.

"GA's a very special place. The culture that Steve Denning and Bill Ford have created over the years is unique in private equity," he says. "It combines collegiality and tremendous sharing of knowledge across offices and across vertical investment areas, with a very high energy and entrepreneurial culture."

Strong relations

Along with GA's corporate culture, the GP's unique investment approach played a key role in shaping Nash's views on portfolio companies. Though the firm provides large investments, with check sizes ranging from $50 million to $500 million, it was unusual in being willing to commit to those large rounds as a minority investor, rather than demanding control.

This meant that, instead of being able to direct portfolio companies, Nash had to learn the arts of persuasion and consensus-building, giving advice as, at most, a board member. While the investment strategy means taking a larger risk than other firms might consider advisable at those price levels, it also means that GA has managed over the years to build up closer, more trusting relationships with its investee companies than GPs who insist on retaining control.

That respectful relationship with Garena was a major factor not only for GA but also in Nash's own future, since management was familiar enough with him to be comfortable seeing him come to the other side of the desk. Even for Nash, adjusting to these new circumstances turned out to be fairly easy.

"I tried my hardest to change my mental gears from almost the very first day. I think the thing that made it very real for me was when we moved into our new offices in Fusionopolis, which is the main tech corridor here in Singapore," he says. "Being surrounded by such an amazing amount of technical, business development and strategic talent, all in one environment, just reinforced to me how special it is to be part of a high-growth company."

Heading up Garena's expansion in Southeast Asia has been an enlightening experience. The company hopes to build itself into an internet platform to rival Google, Alibaba Group and Tencent Holdings, and to create an online ecosystem by investing in other tech start-ups - including Vietnamese food platform Foody and Singapore online grocer RedMart. In pursuit of these goals Nash has had to take direct responsibility for the kind of day-to-day issues that never concerned him as an investor.

The problems Nash deals with in his new role have also given him a new perspective on those who now fill his old one. In a recent event for the global Kauffman Society, a network for rising talent in venture capital, Nash had a conversation with another entrepreneur. While discussing the VCs who sat on each start-up's board, Nash recalls, he asked how many the other entrepreneur would miss if they did not have a contractual right to be there due to their investment. The answer? No more than two out of five.

"As I talk to many entrepreneurs, I think that's a consistent ratio," Nash explains. "In general there are firms like GA, KKR, and Silver Lake, where the board engagement is very valuable, but unfortunately as the industry has grown, the capacity of the industry at the investment professional level to be strategic and add value at board level sometimes hasn't caught up with the growth in the number of firms, the number of investments, and the assets under management."

Nash believes that his experience may offer a model for the industry to improve its value-add capability. The kind of lessons he is learning as an entrepreneur will help not only as a board member, if he returns to the world of investing, but as a potential member of a deal team as well. Having seen the kind of issues that can strike a company, he will be much better prepared for the questions that need to be asked to spot potential problems.

This kind of mid-career sabbatical can help with another problem that Nash has seen growing in the industry: that of overspecialization. More and more, newcomers to the field concentrate on building their expertise in certain roles and leave other jobs to members of other teams. While this may improve efficiency, it leaves their firms lacking flexibility.

"There was an age in the industry when everybody was simultaneously an ops improvement person, a prospector, a board member and an investment committee member, and the wearing of multiple hats created a tremendous amount of knowledge and skill sets," he says. "The specialization that's taken place over time has certainly helped optimize a little bit, but it has probably also taken away from some of that learning."

Think before you jump

Though Nash encourages other PE professionals to take his example, it is not something that one can jump into. It would also be counter-productive for PE firms to require their staff to take this sort of career break. Those who want to pursue such a change must take several factors into account.

The first is the temperament of the professional. There are some who have a natural curiosity about the inner workings of their portfolio companies, and others who do not. While the latter might actually have the have the greatest need for the experience, it is unlikely that they will be interested in it, and forcing it on them is not good for the professionals or the company.

Also important is the relationship between the professional and the company. In Nash's case, he had spent over a year working alongside Garena's management when the CEO made his offer. That chemistry helped him enter his new role quickly and comfortably.

Finally, a professional interested in making this kind of move should pick a company that is going through a transition of its own. Whether it be from a local player to a regional major, or from a private firm to public, companies that are transforming themselves will offer more opportunities for newcomers to build their skills and experience.

These conditions can be difficult to meet, and to a certain extent they rely on factors beyond an individual's control; therefore the mid-career sabbatical may never become a widespread practice in PE. However, Nash believes that the benefits are clear enough that it should be seen as a valid option.

"The level of understanding you get by being inside of a company dramatically improves your ability to be a good investor," he says. "Regardless of whether or not the industry adopts this as sort of an established program, the subset of firms that do encourage this will find that it actually dramatically improves their returns."

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Southeast Asia
• Technology
• People
• Southeast Asia
• TMT
• General Atlantic