#8 Simon Vickers - Swiss AMC

The vestr Securitization Podcast

The Five Questions Every AMC Investor Should Ask! Simon Vickers on Democratising Private Market Investments.

In this episode, we sit down with Simon Vickers, CEO of Swiss AMC, whose career spans Drexel Burnham Lambert, Morgan Stanley and decades of structuring investment products. Today, Simon is building one of the most innovative securitisation offerings, combining product structuring, distribution and capital raising to bring institutional-quality investment opportunities to sophisticated investors.

Simon explains why Swiss AMC deliberately combines securitisation with distribution rather than treating them as separate businesses, how every investment is designed around five fundamental investor protection questions, and why he believes AMCs are uniquely positioned between traditional loan notes and investment funds. We also discuss the growing role of regulated strategy managers, the advantages of protected cell structures, the practical realities of raising capital, and why many investors still fundamentally misunderstand what an AMC can actually do. You will also hear insights on:

• The five questions everyone should ask before investing in any private market opportunity
  

• Why are AMCs becoming a more flexible alternative to both loan notes and traditional investment funds
  

• Why regulated strategy managers are becoming increasingly important for investor protection
  

• How different jurisdictions, including Luxembourg, Guernsey and Cayman, are selected depending on fundraising objectives and investor preferences
  

Whether you are an asset manager, family office, wealth advisor, investment banker or alternative investment specialist, this episode provides a practical look at how securitisation is expanding access to private market investments while offering greater flexibility than many traditional investment vehicles.

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🎙️ Transcript:  

Stefan Wagner: 00:23 Hello, and welcome. In this series, we explore the cutting edge of investment innovation. I sit down with leading asset managers who use securitization vehicles to execute the unique investment strategy.

Simon Vickers: 00:35 The understanding of AMCs is that they are for family offices that are seeking to monetize wine collections, art collections, wine collections and that's it. Whereas they are so much more flexible and so much more adaptable than people are given to believe.

Disclaimer: 00:54 The information in this presentation is for informational purposes only and does not constitute an offer, solicitation or recommendation to buy or sell any financial products. It is not intended as investment, legal, tax or accounting advice. Always seek the advice of your financial advisor or other qualified professional regarding your investments.

Stefan Wagner: 01:16 My guest today is Simon Vickers, CEO of Swiss AMC. I'm excited to welcome Simon as Swiss AMC sits at the intersection of democratizing of the actively managed certificates wrapper and the creation, infrastructure, and distribution of these products. Swiss AMCs runs a full stack combining securitization and distribution across a broad range of assets, private equity, commercial and residential property, trade finance, and even collectible art. That breath alone is worth an hour of conversation. I also want to explore the client journey who comes to Swiss AMC, what problems they aim to solve, and how the market is evolving in regulation, distribution, and minimum ticket sizes. Simon, welcome to the show.

Simon Vickers: 01:59 Good morning. Good morning. Thank you for your time.

Stefan Wagner: 02:02 Thank you for taking the time, Simon. Can you start by telling us a little bit about your background and how you became the CEO of Swiss AMC?

Simon Vickers: 02:09 Yeah, my parents didn't like me so I did the traditional British boarding school but then spread the wings and ended up on the west coast of America at business school. That took me on to the go-go guys of the early 1990s, Drexel Burnham Lambert. Play the original jump on high yield security gods I’m featured in a film called the big shorts so essentially, I learned how not to do it I’m at a very early age. Move from Drexel to Morgan Stanley in San Francisco then came back to the UK I’m family office where we did a number of listing a variety of different products. Um, ranging geographically from Tasmania to Blackpool in the UK and from tailings operations to, um, bespoke sports cars. So that's essentially led me to, I suppose, seeing the light, um, with my co-director, uh, Dale Greenland.

Stefan Wagner: 03:19 You even put the name AMC into the name of your company, so there must have been some specific factors that attracted you to the AMC wrapper and securitization in that case.

Simon Vickers: 03:34 Yeah, we've done 60 or 70,  listed bonds. We've done, um, a number of loan notes. Uh, but for us, it was about from the investor's point of view, being able to satisfy five questions that we always ask from the investor's perspective. In the vernacular, where does the money go? Does it go to dodgy Dave, the property developer who's your best friend until it's branch. Does it go to, how is that money protected? Does it go to Dodgy Dave's trustee, who also happens to be his uncle? So where does the investor's money go and how is it protected?

In the case of an AMC that's a debt instrument, how is the coupon, how are the funds for the coupon generated? Are you operating a Ponzi scheme? Once the company does start to generate some funds, what protections in place to make sure that the investee doesn't decide that he'd like a new Ferrari on a Friday afternoon? So, the first four questions, where does the investor's money go? How is it protected? How is the coupon generated? And how's the coupon protected? The fifth question is the one where very often they fall down and that's what's the exit strategy. Is there a credible route to return the maturity? We build AMCs to address those five issues.

Stefan Wagner: 05:09 You sort of, in a sense, touched on my little bit on my next question because, you know, there's very different iterations of the AMC and one needs to do their right due diligence, but you are sort of doing, and I think that's unique, you're doing both securitization and distribution. Most people are either I'm the pure product provider or I'm the pure investment manager who might want to raise the money. How would you succinctly describe your value proposition?

Simon Vickers: 05:37 We… We're back to front. It's the most simple way of describing it. So we have a number of fundraisers that we work with, indeed family offices, and one will approach us with a view to saying we would like to be involved, for example, in the iGaming space, in the iGambling space. Can you create a product for us? We will fund it rather than us creating the product, then going to look for the funding. So we work very, very closely with the investee companies initially, and also with the funders, and we act as a link between the two.

Stefan Wagner: 06:21 I see. And you mentioned, are the investors typically family office, high net worth individuals, or also discretionary fund managers, private banks? Where does it sit so normally?

Simon Vickers: 06:33 Absolutely. We're broadly agnostic with the exception of retail investors, we don't get anywhere near retail clients. We're predominantly, these are private placements for high net worth, sophisticated investors. Um, the majority are family offices and ultra-high net worth with conjunction, with their wealth managers.

Stefan Wagner: 06:55 You touched already on your five main questions. If I'm not mistaken, for different business cases, you use different issuers, location, jurisdictions and everything else. Maybe you can share a little bit how your due diligence process works and how do you pick the best one?

Simon Vickers: 07:14 Again, it's about the fundraising because it's all very well creating the vessel, but that vessel needs to be filled. So, for example, if we're looking west and we're looking to, for example, the Caribbean, and we've got a number of hotel and resort developments there, we'll use the Cayman. If we're looking to do this quick treat because we have some great relationship set up will run to guernsey if somebody if an investee or indeed. Investor is looking for a more robust mechanism we will work via Luxembourg but I think much of this is predicated very much in. Perception I think I’m in the UK.

There is still not perception that the cayman, has been infiltrated by Tom Cruise and his merry friends from the late nineteen eighties, where is the Americans have an entirely different perspective most hedge funds are domiciled. Similarly with Luxembourg, it enjoys a status that sees it as the gold standard. I personally don't see huge amounts of differences other than the due diligence process is more complex between Luxembourg, between creating a Luxembourg AMC and one that's coming out of Germany.

Stefan Wagner: 08:47 Is there sort of a primary criteria?

Simon Vickers: 08:50 Um, very often that's governed by speed to market. Um, there is very often a need to move, move quite quickly. That's an element that we, that we like about the AMCs. We can, we can pretty much go from being mandated, um, to having an AMC live. And our definition of having an AMC live is that the, the icing number is, is up and ready. Uh, and the piece that normally takes the longest for us is opening the custodian bank account. and the custodian bank account is in place to take the funds.

Stefan Wagner: 09:24 Yeah, that is always fun. If I'm not mistaken, you have decided only to work at the moment with off balance sheet issuers, not to work with on balance sheet issuers. Is there a reason for that one or what's the rationale?

Simon Vickers: 09:37 It's simply, it's simply that as far as the, uh, investee company is concerned, it makes more sense for them to have this sitting off balance sheets for us. Uh, we like that because for the investor, um, the risk sits around what the, what the security happens to be. Um, and that security is, is readily defined within the PCC structure.

Stefan Wagner: 10:05 And it also, it has the beauty of the ring-fenced and the credit risk is not that one of the banks, which is, yeah. You don't get a brand name, but you get a ring-fenced structure, exactly. For an investor, if an investor wants to invest in AMC, obviously, he needs to like the investment strategy, but is there also questions he should ask regarding the structure itself I mean if it's in guernsey or jersey is that has it impact on his tech side I mean is that liquidity you mentioned already.

Simon Vickers: 10:42 With when we're setting up we have a strategy manager that sits in place on all our MCs we have a regulated strategy manager. What that means in essence is that when funds hits the custodian accounts they are dispersed on the instruction of the regulated strategy manager. He instructs funds to be moved in accordance with the investment strategy that's laid out in the term sheet. So that's slightly getting away from your question as to withholding tax, et cetera. But I do think that's an important point and a big difference, actually.

Going back to the earlier question, between why we're so wedded to AMCs over and above loan notes and funds. While they are often seen, that's AMCs, as lighter touch, the introduction of the regulated strategy manager really means that money can't go sideways, or if it does, and that sideways is obviously a euphemism, if money goes sideways, that's on the strategy manager because he has oversight on how that money has been deployed. It's obviously then for the investor to be able to chase up on the investment strategy manager and say, why was that money spent in Annabelle's on Saturday night?

Stefan Wagner: 12:18 I mean, I definitely see this also, what we see, that more and more of the AMCs that we see are either with a strategy manager, a regulated one, or go the other way of being fully rule-based, sort of index, where there's an independent index calculation agent involved in it. Definitely. My personal experience, and I have invested also in AMCs, is that some banks sort of make it deliberately difficult for their clients to purchase an AMC that they have independently selected. It's either whether they don't understand the product, unfamiliar with a specific issue, or simply do not wish to lose the assets of the under-management. From your experience, which type of custodians or banking partner tend to be more open and constructive when clients want to invest in AMCs? Or is there practical advice you can give?

Simon Vickers: 13:12 That's a, that's a very good question. Or obviously, um, the banks do have a responsibility toward their customers, um, and to make sure, um, that, that, that they haven't been taken advantage of. It's there are a number of very sad cases, but they are in the retail space. That's not where we hunt. That's not where we hunt at all. Um, and I do think that sometimes there's, there's crossover that takes place here. Um, between those, those two pools of those two pools of capital, it's not actually something that we've been greatly affected by. And I think, I think that's by virtue of the fact that we do work so closely with, for example, um, the family offices, they will have already gone through their credit committee, their investment committee, their treasury committee. So they have funds ready to go and they have a relationship with their banks already in place. So we rarely deal with individuals.

Stefan Wagner: 14:12 You're lucky. When I tried to do it via my German bank, there was a massive upheaval and then I just used my Swiss quote account who exactly knew what an AMC was and called the paying agent and it was immediately traded. And the term actively managed certificate or AMC is actually; it's a branding term. It's not really, there's no legal definition like with what you could say, ETF, which has certain regulatory requirements. So often the term is even ambiguous. Is the active referring to the discretionary management of the underlying, the liquidity of the assets, or the investor's ability to trade in and out? Have you observed any of this confusion in the market and how do you ensure the clients understand the specific meaning of active in any given AMC?

Simon Vickers: 15:03 That's a good question and it's one that we're often asked. We're also asked, is an AMC a regulated product? I'm on the outside of courses is no but each component park is regulated and that's an element that we show. When we stop pushing and I am saying we always go to the point of creating a schematic with each one of the counterparties how they are related. And also, with reference to each component being regulated, whether that be the trustee, whether it be the custodian bank, the paying agent, the regulated strategy manager, all of these are regulated functions, as of course is the distribution element.

Stefan Wagner: 15:56 Let's go a little bit maybe in sort of the elephant in the room, the regulations about AMCs. What would you say is the biggest criticism or regulatory criticism or concern around AMCs?

Simon Vickers: 16:12 I would have to say distribution comes at the top of the list. When a term sheet is produced by the issuer, the list of who can and can't engage in an AMC, it will be easier just to say who can rather than who can't, because that list is pretty extensive. So I'm going to say distribution. And again, we could probably talk about this for at least an hour.

Stefan Wagner: 16:49 Yeah, let's not do that. I mean, we don't want to put everybody asleep. Lawyers and compliance officers frequently ask why AMCs are not classified as a fund or fall under AIFM. How do you explain this distinction and do you believe it will remain valid over time?

Simon Vickers: 17:08 Well, I actually see that that distinction is born of the with due respect, which always means no respect. It's born of the EU's love of regulation. And that's spawned AIFMDs. And they're a more complex proposition that's designed for institutional markets, whereas we have AMCs that are more suited for private debt markets. I think that's really where the distinction lies. Lawyers and compliance officers do often ask why an AMC isn't classified as a fund and is therefore not subject to AIFMD or similar. It's born of the EU's love of regulation.

Stefan Wagner: 18:04 Do you expect anymore, anticipate any more regulatory attention to this treatment and probably changes to that?

Simon Vickers: 18:11 I don't think there's any doubt that's inevitable. I think one of the major components that's going to be brought in here is that of securitization. I think it's inevitable that with digitization of issuance, AI-driven management, with the scalability, so the risk of mismanagement becomes so much more apparent. And for that reason, I think the regulator will be looking to take a much, much stronger hand.

Stefan Wagner: 18:45 And it will be, you know, transparency and responsibility with responsibility, enforcement in a sense. And the product has grown, you have issued a lot of products, but are there still sort of misconceptions, other misconceptions you run into when you try to bring this product to market?

Simon Vickers: 19:04 The understanding of AMCs is that they are for family offices that are seeking to monetize wine collections, art collections, wine collections, and that's it. They're for family offices to custody collectible assets, whereas as we all know, it's so much broader, so much wider than that today. So I think that's probably the primary misconception that they are so much more flexible and so much more adaptable than people are given to believe.

Stefan Wagner: 19:40 Yeah, I mean, the flexibility is unheard of. The funny thing I find often is that people trying to define their own new brand name. I think I've come across 16 different names for what basically is an AMC, fractional bonds, other things. Everybody wants to have their own name, which doesn't help. explaining to the market what this thing can do by giving it different names. But yeah, that's my gripe basically. Of all your products that you're having on your platform, is there one that is your favorite or that's your standout right now?

Simon Vickers: 20:15 I don't think it will be fair to say that a particular product, because we do have a number that are currently live. And for that reason, I would, I would upset those that those that are highlighted, but I'm going to do it anyway. Um, we are heavily involved with a company called Sullivan pharmaceuticals. Sheldon pharmaceuticals is in the pharma space and it's bringing full it's one of the few licensed growers of cannabis for medicinal purposes in the UK. Um, they've spent a huge sum of money and we're talking 40, 50 million pounds to be able to go through the testing and to create the operation that they have. The test results are phenomenal, um, for helping women with endometriosis. So for that reason, um, I would champion them, um, above, above the others, uh, on the basis of the, the asset class in which they they're driving.

Stefan Wagner: 21:21 I mean, Swiss AMC really does a lot of interesting thematic-based AMCs, I would call them, and that otherwise you would not be able to invest in. It's a tool in excess, and I think that probably also drives you why you have to use the SPVs, because the on-balance sheet issues probably can't hold all these assets on the balance sheet. try to look into the future. What do you anticipate going forward will happen in the AMC market securitization landscape?

Simon Vickers: 21:55 I think as far as security validation goes, I think they will become increasingly mainstream as they are seen as more robust than a loan note and more flexible than a fund. Their adaptability, particularly within the CLN, and that's collateralized loan note rather than convertible loan notes. I think there is going to be huge growth in that, but then that also does lead to making very, very sure that we have the right security trustees in place to be able to oversee the assets that are held within the PCC. That's going to be a central tenet of making sure the market does grow properly.

Stefan Wagner: 22:46 I mean, you touched on your career, you know, where you came from, Drexel, lots has changed. More and more information is hitting us every day, you know, data and information, maybe sort of on a personal note, how do you structure your own information diet? You know, in other words, what conversation sources or data do you prioritize sort of to stay informed what's happening in your industry?

Simon Vickers: 23:13 I think there is a massive amount of noise, there is increasing pressure to react very quickly, and there is a huge degree of short-termism. Uh, how do, how do I personally do it? I have a tight network, um, of people that, um, I know and trust. Many of those are, are now, um, what the insurance industry calls chronologically advantaged, but that doesn't mean that doesn't mean that they're any less agile. It merely means that they made an awful lot more mistakes than I haven't learned from them.

So I rely very heavily on my own my own personal network while it's important to have access to Bloomberg except you could honestly you could spend your entire life watching news feeds i think it's the ability to be able to separate the important from the noise and that really comes back to a classical education of being able to look at a sentence and say there's the subject, there's the verb and there's the object.

Stefan Wagner: 24:22 Basically using your personal network to pre-filter all the data out there.

Simon Vickers: 24:26 Absolutely.

Stefan Wagner: 24:29 What is your favorite finance book and why?

Simon Vickers: 24:33 That's a good question. I think probably Barbarians at the Gate would probably be an interesting read because it simply identifies the ridiculous levels to which we went to in the late 1980s. agreed the average the hubris ultimately is a good read and while it is it is. Not an easy read it does identify the issues that might just be brought to bear over the next few years. Will you please share those that don't learn from history and all that good stuff.

Stefan Wagner: 25:20 Yeah, it seems to repeat itself quite often. Is there any questions? Actually, I've been asking you loads of questions. Any questions you would like to ask me?

Simon Vickers: 25:30 I would be very interested to know from investment banking to shop block, what was that journey?

Stefan Wagner: 25:41 I think the journey was interesting for me because the investment bank world changed dramatically obviously after 2008. So what I always liked about the investment banking historically was, okay, you were on a decent salary, but you could participate in the upside if you had good ideas. So I always said you were longer call option to an industry where you were basically, a shorter put, you collect your premium, but if you at any point in time made a mistake, your career was at risk. And so when that changed, I needed to find a different way where that was reversed again. And that's why I ended up basically in a fintech, where, you know, if this got to work, I can participate in the upside in my knowledge and ideas are appreciated and not seen as a threat or potential risk.

And so for me, it was what always interested me about investment banking was gone, so I needed to find basically a different place. And I was even, I think I remember this at Bankers Trust when I did my original interview, I argued that investment banking actually, Karl Marx would have loved investment banking. Yeah, because the criticism of Das Kapital is that only the person who provides the capital gets all the return, not the employees. During my time in investment banking, that was slightly different. We got significant bonuses before the people who hold the shares in investment bank got paid.

Simon Vickers: 27:26 Absolutely, that's incredible. I have no follow up to that. It does come back though to Barbarians at the Gate, doesn't it? Classic example. I'm sure you've read it.

Stefan Wagner: 27:43 Simon, thank you very much for taking the time. If anybody wants to get in contact with you, what's the best way?

Simon Vickers: 27:50 I'd be delighted to hear from them. I'm at SV, that's Sierra Victor, at swiss-amc.com.

Stefan Wagner: 28:01 Perfect. Thank you, Simon. What a pleasure.

Simon Vickers: 28:05 Thank you, Stefan.