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Andy Lim

Become – High Profiles
July 23, 2015

In this fourteenth storey suite at Ocean Financial Centre, Andy Lim scours the world for investment opportunities, for the clients who have placed their trust in him. Making the jump three years ago to start his own fund was perhaps unsurprising for the former private banker. “I am not good at office politics and I’ve always believed I have the ability to do well without this,” he tells me. “With my character, it’ll be difficult to do very well on the corporate ladder” he adds, taking a moment to ponder, before admitting that such ‘relationship-building’ skills are nonetheless important. “But it should not be 90 per cent of the KPI right?” he questions incredulously, reminded of past experiences. “Honestly, just using flattery will limit how far you can go. To really go far, you need real capabilities.” he concludes. His first newborn son at the time also gave him the much-needed push. “My son was about 1-year-old when I started the fund,” says the now father of three. “That gave me a lot of courage, in wanting to do more, and to see how far I can stretch myself.” He turns 38 this year.

His vision is to be the best fixed-income manager in Singapore. He’s not overly confident or trying, but exudes a firmness conveying the pride and belief he has in himself and his team. His funds returned at least 18 per cent last year, putting AT Asset Management in the top percentile of fixed-income managers. He hopes to double his fund’s AUM every year. This year’s target is S$200 million. He got his start more than a decade ago doing branch sales. I ask what’s stopping his former colleagues from making the jump like he did. “Many private bankers make a good amount of money,” he says as a matter-of-factly. “So they have a big fear of opportunity costs.”

Andy subscribes to the teachings of the ancient Chinese scholar Confucius, which guides his outlook in life and the various goals to achieve for each stage. “When I was 20, I was very driven, worked very hard, but without wisdom.” As we speak, his eyes constantly dart to his screen. Checking prices, I reckon. While not running his fund, he is also a partner in Museo, one of the top-ranked restaurants in Shanghai. He has a Singapore outlet at Sentosa Cove where food meets art. “When a man reaches the age of thirty, it’s the most crucial part of his life. Thirty to Forty is his golden period,” he says. “If you don’t form a certain character in your thirties, it becomes very difficult to change after that.” The traditional man ultimately believes in discipline. “When you’re not disciplined, a lot of things will not work out.”

Conversations with Andy Lim

Co-Founder & Managing Director, AT Asset Management
Text by Yong Hui Yow
Photography by Yew Jia Jun

YONG HUI YOW: How was the 50For50 experience?

ANDY LIM: My wife was the one who’s really involved, from selling the bags and coming up with ideas for charity. It’s all her credit. It was a very busy few months. I even told her she should consider taking a break, because she was also having our third baby, which came about 2 months ago.

YONG HUI: Is she your first daughter?

ANDY: Yes, that’s right. We have two other boys.

YONG HUI: Did you want a daughter this time?

ANDY: I’m neutral, but my wife really wanted a daughter. It’s a good thing to have a daughter because I’m so used to handling boys and men. I’m not sure if I can take the softer side. A daughter would be closer to the mother in the longer run, so she could be my wife’s best friend.

YONG HUI: What were you doing before?

ANDY: I was working in Standard Chartered Private Bank, covering the Indonesian market.


YONG HUI: What made you leave?

ANDY: I felt I had maxed out how far that job could satisfy my personal aspirations. My first newborn son then also gave me a lot of courage. I’d wanted to start my own business for a long time. I also asked myself: What am I capable of doing? What can I do? Fund management and investment have always been my strengths. I’ve been doing well for my clients’ portfolios for many years, which gave me the belief that I can do it on my own. When I started the fund, my son was 1-year-old, and I felt responsible as the leader of the family, to inspire my son. That gave me a lot of courage, in wanting to do more, and seeing how far I can stretch myself. We just turned three.

YONG HUI: How did you go about it?

ANDY: It was a big move for me, because then, my wife had quit her job at Citibank, and was taking care of our son. When I decided to set up AT Asset Management, a lot of friends and family thought I was crazy.

YONG HUI: What were the challenging parts?

ANDY: In a bank, you only specialise in one or two things. You’re either in sales or investments and so on. When you run your own business, you’re involved in so many different things: cost management, prospecting clients, portfolio management, risk management, strategy, HR, and so on. My initial disappointment was that the closest clients I used to have didn’t want to follow me. That was a big dampener for me, but what doesn’t kill me, only makes me stronger. We moved on, and built our performance and credibility. We are small, but we made our way though our own merits, by showing real performance. You need real performance before people can support you. We started to see results after six months. After that, we started taking on family offices. At first, people were uncertain how far we could go. They might have thought we’d fold up after six months. That would have been disruptive for any investor’s portfolio. I started to understand we can never take things for granted.

YONG HUI: Is starting their own funds something many private bankers want to do?

ANDY: Yes. This is a private banker’s dream, but to do what we’re doing, isn’t just sales. Private banking is mostly a sales-driven process. Starting your own business involves many more things, but you’re right.

Most people are not confident enough to go out and get clients’ money, and to prove their strategy.

YONG HUI: What’s stopping them?

ANDY: A fear of opportunity cost. Many private bankers make a good amount of money, so it’s a big factor. Second is: how to go about doing it? Many are not familiar with running a business. Lastly, of course is: if you want to become a fund manager, the person who’s setting it up must have a certain level of skill in investing, and they must believe the strategy will work. Most people are not confident enough to go out and get clients’ money, and to prove their strategy.

YONG HUI: What’s your strategy?

ANDY: We’re a long-only hedge fund, and our focus is in fixed-income. It’s something we think that’s an all-weather instrument. There may be bad times, but over time, it’ll continue to do well. We have some equities and currencies exposures as well. In a way, we’re running quite an un-constrained strategy, but we cannot expose more than 20 per cent to equities. For our fixed-income component, we do a lot of geographic and sector rotation. We run absolute returns, have a soft hurdle of 5 per cent, and high watermark, which is typically the case for hedge funds.

YONG HUI: Out of curiosity, if you want to change the mandate, what happens?

ANDY: If there’s a change in strategy because let’s say, equities are cheap, we might want to raise its allocation to 30 per cent. In such a case, we’d have to change the mandate, and get approval from all clients on the new strategy.

YONG HUI: Do you customise for clients?

ANDY: We’ve never intended to customise, which means all our investors buy-in to the strategies we provide. We have a dual strategy: one is full fixed-income, and the other is up to 20 per cent equities exposure, which means we are still ultimately mostly fixed income. Investors who put money with us agree with either one of them, or both.

YONG HUI: Which geographic regions do you favour now?

ANDY: Right now, we’re bullish on European equities and fixed income. We favour Chinese equities as well, but I think the recent spike is a little overrun, so we took profits last month. Last month, we made good returns: on overage, close to 40 per cent. We’re overweight banking and securities firms for Chinese equities. In Europe, we think the QE will continue, and should continue to boost the market, especially in equities. The bond market should also continue to be healthy, but correction could come soon. As such, we’re holding quite a bit of cash now. Also, we think the Euro’s recent strength will not last.

YONG HUI: What technology stocks do you favour?

ANDY: Technology isn’t our forte selection, but we have some technology stock exposure such as Apple. Apple has quite a low P/E and holds a lot of cash. They have been getting their strategy consistently right in the way they’ve penetrated new markets, and in new product development. The growth prospects are clear to us even though it’s not so much of a growth stock at this point in time. We like Microsoft too with the new CEO. A lot of things are changing with Satya Nadella in charge. We think he’s getting the strategy right with software. We also like Facebook, which we think still has a lot of potential, but the P/E is already pretty high. We have some small exposure in ecommerce businesses as well.


YONG HUI: What do you think of many of these founders having too much control even when they’re public?

ANDY: Many technology stocks don’t trade the way a normal company would. For these companies, it depends on the leader running the company. This is true for all companies, but especially so for technology stocks. P/E is just a small factor for how these companies trade. I’d say that control is very important for technology companies. If the founder has no control over a technology company, I personally, would have less belief in the company. It’s about the leader, the vision, how they want to capture the market, and drive new products into markets. If the leader starts to get lazy or complacent, that’s when it starts to change.

Wisdom does not come overnight. You have to fall before you learn something.

YONG HUI: What about from the corporate governance point of view?

ANDY: Different businesses require different levels of control to do well. This differs across companies and sectors. In fast-paced businesses, things need to move very quickly, such as in technology. Decisiveness can only come with a certain level of control. If there’re a lot of checks, it slows down the process. In industries such as Banking, things are more stable, so you need very good corporate governance, to make sure your traders are following the rules.

YONG HUI: How much harder is it for boutique firms to raise assets?

ANDY: It’s definitely easier for bigger funds to raise money. Smaller boutique houses have to prove ourselves more, to deliver above outstanding returns before we can get the same level of attention. People always use the big houses as benchmarks, and if they’re generating 20 per cent, and you’re doing only 18 or 15 per cent – who would be keen to invest? That’s the part we always bear in mind. We want to do better than the bigger houses. Also, we’re running a hedge fund, so by its nature, it’s already harder to get clients.

YONG HUI: What drives smaller funds to consolidate?

ANDY: There’re maybe a hundred houses in the market. Not all will do well, and some could even be losing money because they invested in the wrong views or assets. Things get a lot worse when there is a massive disruption in the market. For example, during the financial crisis, there’re many people who got it totally wrong and had to consolidate due to major outflow of funds to competitors.

YONG HUI: How big is your team?

ANDY: We currently have six people, and are expanding. We just moved into this office last month after signing a lease for five years. We hope to grow our team to between 10 and 15 next year. That should be a reasonable size for us.

YONG HUI: What’s your AUM?

ANDY: At the moment, over S$100 million.

YONG HUI: What products do you have?

ANDY: We have our managed accounts to serve the Ultra-High Net Worth Individuals (UHNWIs). There’s no clear definition for HNWIs, but typically US$30 million and above. Our typical client base for our managed accounts consist of people with net worths between US$50 million to US$150 million. Last year, we started our Cayman Fund, which has a lower entry point.

YONG HUI: How did you get your start in finance?

ANDY: I started out doing branch sales, selling unit trusts and other things. I became increasingly interested in investing, and started picking up more investing skills. Before that, I was a pure salesperson. I just sold whatever I have to sell. Over time, I started to challenge myself to better my performance and returns for myself and clients. Then I really started following the numbers.


YONG HUI: You’re about forty?

ANDY: I’m 38. I started this company when I was about thirty-five. I always have a five-year plan, and I try my best to achieve it. Every five years is a new chapter, a new target to achieve.

YONG HUI: What’s your target for this chapter?

ANDY: Maybe I’d like to keep that a secret [laughs]. In general, I hope I can help more people as well. I also want to build character. I want to have positive energy that I can pass on to other people. Naturally, I want to set a good example for my kids.

YONG HUI: What aspirations do you have for your children?

ANDY: This is the question I ask myself. I don’t really know to be honest. My wife and I agree that it’s very difficult to force people to do something. We can influence them, but when we have high expectations for them to follow in my footsteps, we could be disappointed. I want them to have a lot of drive for their own lives. Whatever job they take up, they should be extremely motivated, driven and have the passion for it. Deep inside, preferably, they can carry on our business. If not, if it has to be run by professional bodies, so be it.

When you’re not disciplined, a lot of things will not work out.

YONG HUI: What is the biggest difference between your twenties and thirties?

ANDY: When I was turning 30, I was fearful. When I was 20, I was very driven, worked very hard, but without wisdom. Wisdom does not come overnight. You have to fall before you learn something. There is this confucious saying: nan ren san shi er li, shi si bu huo. There are many interpretations, but one of them is: when a man reaches the age of thirty. It’s the most crucial part of his life. Thirty to Forty is his golden period. If you don’t form a certain character in your thirties, it becomes very difficult to change after that. At every stage of your life, you should maximise what you’re supposed to be. One needs discipline. When you’re not disciplined, a lot of things will not work out.

YONG HUI: What is one setback you experienced?

ANDY: I’ve had setbacks in my twenties in personal relationships and career. I was at another bank, and things didn’t turn out what I thought. Some companies have a lot of politics. Some bosses like people to sugarcoat and flatter them. I always believed that I have the ability to do well without needing to play office politics and flatter the bosses. I have this character in me. I had a hard time for awhile in that bank, but I stayed on because I did not want to leave at my lowest point. Later, I moved on to Standard Chartered Bank, where I started to do very well. What I try to do is over-project and look back: What should I be doing at this age if I were looking back from the future. Confucius teaches you to stick to basic fundamentals.

YONG HUI: The environment is crucial.

ANDY: Yes, the environment is very important, but I thank both my good and bad bosses equally. Okay maybe not equally. [laughs] Life is a learning journey. When I was in the army, I was a clerical clerk as part of the mono intake, and I was the OC’s [Commanding Officer] personal assistant. If you didn’t go through BMT [Basic Military Training], your OC would not give you a lot of respect. [laughs] I fractured my foot and he probably thought I was finding excuses. My time there was a nightmare. For example, he gave me a whole manual to retype. He’s an old encik, and does not know how to use a computer, so I had to print out emails, show it to him, type out the email according to what he wrote down on paper. It was so structured, and he was giving me a hard time, but I respect him nonetheless for his dedication to his job.

YONG HUI: He didn’t like you because you didn’t flatter him?

ANDY: Yes. [laughs] I’m sure that was part of the reason. When I started to self-reflect, I thought perhaps my perception of him wasn’t exactly correct. Maybe he felt that he was a fatherly figure to me, and thought I didn’t show him enough respect. It was just a wrong job fit for my character. When my understudy came in, he had a good time with him! [laughs]

YONG HUI: Do you think too many people flatter bosses to get by?

ANDY: That’s for sure. [laughs]

YONG HUI: What’s wrong with that?

ANDY: Too much of that is really bad for company culture. If bosses like that, it’ll be very bad for business, and it will be a very inefficient company. If I’m the owner, I’ll be very disappointed. I think some form of favour-currying is unavoidable, but it should not be 90 per cent of the KPI right?

Honestly, just currying favours will limit how far you can go. To go far, you need real capabilities. A lot of people may still go far because of favours, or perhaps they have a lot of charisma, but that’s not what I like.

YONG HUI: How did you deal with that?

ANDY: In many banks, it’s a lot about that. That’s part of the reason I can’t really excel well in the corporate world of such kind, but it really depends what job you’re in. You have less of that in technical or sales roles, because the results are tangible. But in large organisations, you get pockets of people like that.

YONG HUI: Is currying favours just another term for relationship-building?

ANDY: It’s very difficult to say what is currying favour and what isn’t, but some people do it very obviously. If you’re talking about building relationships, there’s nothing wrong with that as long as you’re genuine about it. Personally, I’m a person whom people can see through. Whether I like a person or not, it’ll show on my face. Let’s say you’re my boss, and there’re a lot of things I want to learn from you, naturally, I’ll be nice to you. This is fine. The match must be right first. Certain people however, have very good survivorship skills. Whoever their boss is, he can always blend in very well. That’s also a skill. But honestly, just currying favours will limit how far you can go. To go far, you need real capabilities. A lot of people may still go far because of favours, or perhaps they have a lot of charisma, but that’s not what I like.

YONG HUI: What do you want for your forties?

ANDY: For the company, I hope we can grow our AUM multiple-fold from where we are now.  That’s why we moved in here. We hope to double our AUM every year. The target this year is S$200 million. Our vision is to be the best fixed-income manager in Singapore. Even though we’ve been doing well for the last three years, we tell ourselves never to be complacent. Last year, we did about 18 per cent returns. This year, YTD, we’ve done about 10 per cent. In the fixed-income space, we’re in the top percentile. That’s also a reason we named our daughter Laurel, which means victory and honour. There’s also a saying: Don’t rest on your laurels. In my forties, I hope it’ll be a new chapter for the company

YONG HUI: What about for yourself?

ANDY: Personally, right now, most of my life is around my business. And I want to set a good example for my kids. Hopefully, they’ll be inspired. We hope to spend good quality time with them. Our main aim is not just making money. Of course, making money is great, but right now, it has already moved beyond that.

YONG HUI: What is success to you?

ANDY: Being successful isn’t just about monetary rewards; it’s also about giving back to society. We started to learn from wealthy business owners how to do so. Even at the age of eighty, many still have so much drive and energy to contribute. It made me see that there’s no excuse for not working hard enough. Take the example of Lee Kuan Yew. At a ripe old age, he was still learning non-stop. That’s something which is part of our values.

YONG HUI: Are you happy?

ANDY: Definitely. Life can’t be better.