Talent Without Borders, Gerente Magazine

Luc Gerard, presidente de Tribeca Partners. “Cuando compramos una empresa, primero miramos si tenemos la gente necesaria, si hay que potencializarla, complementarla o remplazarla”. © Revista Gerente

Tribecapital Partners’ CEO Luc Gerard was featured in the February 2007 issue of Gerente, a magazine for business managers in Latin America.

Poverty represents opportunity for Luc Gerard, although not to figure as a benefactor nor to seek the limelight for making handouts. In the eyes of this investor, who in 2004 acquired Coltabaco for Philip Morris, the way to solve this worldwide scourge is to turn it into a business. Gerard maintains that just as the big pharmaceutical companies made it their business to fight diseases, wiping out some of them and getting rich in the process, micromarkets should be seen as a key opportunity for industrial growth. “If philanthropy were the solution, people would have stopped dying of hunger ages ago. We need to reconcile the desire to improve society with that of making money, because the two are not dissimilar, they are not mutually exclusive,” Gerard explains, in a nod to the theory of Jeffrey Sachs, known as the best economist in the world.

The issue for Gerard is that people should not depend on a millionaire’s leftovers, because when there are no leftovers the projects come to a halt, the school stays half-built, the foundation without resources. In order to create a mechanism that does not stop when the good intentions fall short, it is necessary to be productive.

This is why his company, the Tribeca Partners investment fund, has set its sights on several electric and public utility companies, on which it plans to make offers during the second phase of business. These are the means for reaching the micromarkets.

Healthcare Purchases

Luc Gerard defines himself as a glutton for life, comparing himself to having a voracious appetite, because all of his activities have universal resonance.

For him, a game of soccer is like the World Cup; an evening’s party may become Carnival. And as a boss, his feelings are no different. He scored a homerun in setting up his own company -his lifelong wish- in association with Interbolsa and foreign partners, and stepping up as its head.

After a year as the president of Tribeca Partners investment fund, he may brag that he has consolidated the biggest healthcare company in Latin America, with close to 800,000 clients.

His interest in investing in this sector was born from observing that in the region people preferred to put up with sickness rather than going to the doctor, in order to avoid the high costs. Consequently, he did not propose coverage provided through monthly fees and insurance policies, but rather direct service without the need to be registered.

The idea is that any person may make use of good quality service at all levels, from a consultation to surgery, anywhere in Central or South America, by applying this concept: it is not about not being sick, but rather being well with some trouble.

The company noted that the Colombian healthcare model, despite the constant complaints from the users, is seen as a standard in the regional context. Every year, administrators and managers from neighboring countries visit the hospitals and public healthcare service providers, with the intention of replicating the model at their entities. Furthermore, it is known that Colombian medical training is appreciated and acknowledged thoroughout the continent because of the skill of the professionals.

They began by acquiring the EMI (Emergencia Médica Integral), Group, a company based in Antioquia that was characterized by the quality of its service, but that lacked sufficient resources to guarantee its growth.

The investment capital was used to buy new ambulances, X-ray equipment, and software to improve operations. The experience was extended to similar businesses in Panama, Ecuador, Venezuela, Mexico, Brazil, and Uruguay.

Gerard is clear about the fundamental pillars for the growth of a business. First is operational efficiency, which consists of shortening production cycles, reducing costs, and having the ability to respond quickly to the public.

Second is the knowledge of the client: segmenting demand and adapting the product to the expectations of each group, to achieve greater intimacy with the identified target.

Last but not least is innovation. Never allow the creative process to stop, invent -if not new products- then alternative services or creative ways of delivery.

Success: Being Different

The late 1990s witnessed the demise of investments funds in Colombia. Their failure was the result of both the country’s economic crisis, as well as the ‘remote management’ model that the adminstrators used. Now that foreign capital is back, new strategies are being implemented.

In the case of Tribeca Partners, the strategy is communication: publicizing the objectives and the intentions so that when these are achieved, credibility is gained.

“It is about creating a virtuous circle by being consistent on promises and delivery,” Gerard says, and underlines that the characteristic that is most certainly the one that makes his organization different from the others is its degree intervention in its acquisitions.

He says that most organizations only monitor at the financial level, whereas his gets involved in the selection of personnel, internal decision-making, and in the adoption of measures to improve productivity.

Another advantage is that of having clarity about the concepts that Tribeca espouses. The company knows that nowadays being a leader and doing business is complex, because capitalism has changed and it is no longer just about the worth of the products, selling them, and making profits.

Now, as well as meeting the investors' expectations, it is necessary to fulfill obligations to the workers and to the society in which the business is being conducted. Tribeca has embraced these different elements, and formalized a process for creating value that starts with the people.

Gerard’s Vision

“When we buy a company, the first thing we look at is whether we have the right people, whether they need to be reinforced, complemented, or replaced. We bet on the people because we consider that they themselves are the company,” Gerard says assuredly. Without missing a beat, he comments that this took place in Uruguay, where it was felt that the team of 35 people did not meet the minimum standards for competitiveness and leadership, and so the entire team was replaced.

In Medellín the opposite took place. Seeing as the manager of EMI was perfect for the job, he was transferred to Montevideo, while the financial director was sent to provide leadership in Venezuela.

This process, he explains, is what drives the corporate engine. But it takes a sharp eye to spot talent.

And when talent is discovered, it may be sent to work anywhere in the world because, as Gerard says, talent has no borders and can do all kinds of jobs well.

“The successful companies of the world are based on people, on the selection, training, and identification of professionals with outstanding skills and aptitude,” he notes.

On his desk lies a book of travel routes of Colombia. He likes to get out of town every weekend.

Gerard the human being, beyond the businessman, likes to get to know every country in which he lives, and now he can discuss the coffee belt region with the fluency of a native of Antioquia, as well as the cities of the Caribbean coast. He is not surprised that foreigners are turning their attention to ‘the land of coca and Pablo Escobar’ -as Colombia is known internationally- because he considers the country as a hidden gem that for years did not receive the money that it deserved.

He says that with the fourth biggest economy in Latin America, and with the third biggest population on the continent, Colombia should be getting more attention, and he says that because of that neglect, what is coming in now looks like a lot, but in reality it is making up for all of the years during which Colombia was outside of the investment circuits.

As such, when foreigners arrive, Gerard says, they discover a country that is much stronger and stable, with operational public institutions like the Superintendency of Finances and Securities and Proexport.

Nonetheless, the investor finds the country unprepared to receive foreign capital. According to Gerard, the legislation is not geared toward encouraging this activity, in that taxes on business are 38% (the highest in the Americas) and if the investor is not Colombian, he must pay a surcharge that increases the taxes to 45%, one of the highest rates in the world. But he says that the authorities have a good attitude and they are trying to work out solutions.

In general, Gerard considers that disparity exists between the real life situation and the information about Colombia that circulates abroad.
Aside from solid institutions, he considers the variety, the culture, and the people’s tastes to be very strong points.

¿What inspired him to get to know this country? The same wanderlust that made him curious about Iran and that has led him to live in 10 countries without returning to Zaire, his native land.

Gerard has always been interested in visiting places with bad reputations. The reason: he knows that behind the image, every place has its charms that remain hidden from the eyes that do not want to see.

Written by Diana Gamba and published in Gerente Magazine (www.gerente.com). February 2007