Billionaire Has No Regrets About Pulling His Money Out of Banks

(Bloomberg) -- Mohamed Mansour enjoys the challenge of managing his own fortune.

The 72-year-old billionaire set up an investment firm a decade ago to oversee his family’s wealth the same way he and his brothers built their closely held business into a global firm with operations including McDonald’s Corp. restaurants and a General Motors Co. dealership.

Mansour Group’s proceeds have allowed the Egyptian dynasty behind it to invest through their family office in firms such as Airbnb Inc., Twitter Inc. and Snowflake Inc., the maker of cloud-data software that popped 104% on its first day of trading this year. With those sort of results, Mansour isn’t missing someone else managing his money.

“I used to leave my money with the banks, but I wasn’t pleased with the returns I was getting,” he said in a recent interview over a video call from his London home. “They always have an A-team that meets you at first, and you think, ‘Wow!’ But you don’t really know who manages your money, and then you get a 2% return one year.”

“Now I can say, ‘It’s my money and I’m going to invest it.’ And if I lose, I lose,” he added.

Mansour helped lead his family’s conglomerate -- founded as a cotton exporter in 1952 -- following his father’s death in 1976. It’s now worth about $7 billion, according to Bloomberg calculations. His son Loutfy is chief executive officer of their London-based family office, Man Capital, which also has a venture capital business in San Francisco.

Bloomberg spoke with Mansour about how he became an early Facebook Inc. investor, his exercise regime and why he’s waiting for the outcome of the U.S. election. Comments have been edited and condensed.

Did the pandemic hit your wealth?

I reduced my exposure maybe 75% at the end of February. I saw Covid was in China. When it started hitting Europe and the numbers started doubling every five or seven days, I went to my office and told my team we needed to exit any stocks not in the technology sector. We’ve gone into the market a bit since then, mostly in tech, but we have quite a bit of cash as we’re waiting to see what happens. It’ll be interesting to see how the U.S. election affects the markets.

How about your family’s business?

I always say my middle name is crisis. The areas that we work in, such as Egypt and sub-Saharan Africa, aren’t the easiest in the world, but we’re very prudent. Our debt-to-equity ratio is very low -- below one-to-one -- so we can sustain if revenues are slow. I’m sometimes pushed to borrow more, but I like to sleep. You have to expect things will not be rosy forever. And when the tough times come, we have deep pockets to keep supporting our businesses.

Why did you set up a family office?

After serving in government from 2005 to 2009, I was starting a new career. The companies in Mansour Group were solid, and we had liquidity. When you run a business, you really don’t pay attention to your wealth, and I wanted to be able to manage my own money. We used to give it to X or Y bank, but I said, ‘This doesn’t take rocket science. We could hire bright young men and women that can manage our money. If the bank can do it, why can’t we do it ourselves?’

We now have a team of 14 people, including my son, and we’ve established a reputation. The deal flow comes to us, and we do one or two deals a year. It was definitely the right decision, and family offices are the future. We’re not interested in buying a business to spin it off or have a timeline to return money to shareholders. We know how to buy and build great businesses, and to identify the sectors of the future.

Why so much focus on technology?

I was at a conference about 15 years ago, when I heard a guy say the world will change: one day, you won’t need to go and see a doctor in person. Instead, you’ll just need a screen and the doctor will look and just give you a prescription. After hearing that, I said technology is where the future is, and we invested early in Facebook, Twitter, Uber, Spotify and more recently in Snowflake and Adyen.

We invest through funds and investment banks that knew us. For Facebook, I got a call in 2009 from a man I’ve worked with at Goldman Sachs who asked what I knew about the company. I didn’t know much, but as an entrepreneur sometimes it takes guts. So I put in quite a sum of money, and I’ve invested in many other tech companies like that. My private wealth is very centered on the big technology stocks. We’ve stayed with them as we think they’ll grow even with Covid-19.

What’s your view of the U.K.?

I love the U.K. because of the rule of law, and I love London, the city I’ve chosen to live in. If they can do something about the weather, that’d be great. With Brexit and Covid-19, these are challenging times. The U.K. has to decide what sectors it wants to excel in. It has to encourage wealthy people to come and invest. How they decide to do that is up to the politicians, but it’s needed.

How did you spend lockdown?

I locked up totally in London from March to mid-June. That was a tough experience. At that time, nobody knew where this virus was going, but then in the summer I took off and went to the South of France on my yacht, so that was a good relief. Now we’re back to where we were and no one knows what’s going to happen. Fingers crossed there won’t be a strong second wave.

What keeps you busy outside work?

I work out every day. I used to go to a gym in London, but now I use the one in my house. Some days I do just cardio; some days I do weights and cardio.

I love to watch football. I’m a Manchester United fan, but my son is a Chelsea fan. In the summer, I love to go on my yacht. This is my place of solace, where I regain my energy.

I like the theater and opera as well, but right now we have to live with the new world.

Are you going to sell in Airbnb’s IPO?

We’ll wait and see how the IPO pans out. I sell stocks, but I don’t like to sell in general. The assets that my father left us -- such as buildings and land -- will stay with the family.

©2020 Bloomberg L.P.