In 2020, Hodl launched its first two digital asset investment funds which were purely focused on the Dutch market. Since then, Hodl has grown from a small company to an organization with an international focus and ambition, resulting in investment funds in Gibraltar, Spain, Luxembourg and an Actively Managed Certificate in Switzerland. Due to the unique nature of this transition, Hodl Group sought individuals who could aid in this.
As announced in our latest press release, Axel Hörger - who will aid the board as Executive Advisor - is one of these exceptional individuals who has led many teams and people to achieve extraordinary accomplishments. Before starting his extensive career in finance, Axel graduated from Goethe University with a master’s degree in Business Administration – International Economics and Finance. While finishing his studies, Axel joined Goldman Sachs where he worked for 16 years in various positions, culminating in the role of Managing Director for Asset Management (EMEA). Axel then held CEO positions at UBS Deutschland AG, Lombard International Assurance, and Petiole Asset Management. He also chaired and co-founded the American International Bank Acquisition Corp and advised across various industries.
His natural curiosity in technology and finance eventually led him to the digital assets industry and Hodl Group. As Executive Advisor, Axel will aid Hodl Group in achieving our international goals and ambitions, while guiding our digital assets advancements in global capital markets. In this interview, we want to highlight Axel’s gained insights and outlook on the industry.
To answer this question, we need to go back to my younger years. My father had quite a lot of technological expertise as he created one of the first electronic mailboxes. So I grew up around emerging technologies. I was particularly curious and involved in what my father was working on and I learned how to read binary code. Even though I always found technology interesting, I couldn’t picture it as an active part of my career. So, when I finished High School, I chose to study Business Administration – International Economics and Finance at Goethe University. My father hoped that I would have chosen the more technological side such as IT but as I said before, at that moment, it wasn’t my passion.
When it comes to my experience, I haven’t always been active in the finance industry. After finishing university, I started at Goldman Sachs where I worked for 16 years. I co-founded a software company and developed an app called Poltergeist, which focussed on speed messaging through coding/decoding text into emoji strings for iOS and Android. I also have been active in other industries such as cosmetics, mining and food for livestock. However, technology and finance have always been special to me and have led me to unique opportunities.
I also navigated through the financial crisis of 2008, which was a period of profound transformation. Witnessing the search for new forms of money, like Bitcoin, was truly fascinating. My curious nature led me to delve deeper into this industry. I have a penchant for learning and comprehending complex concepts and Bitcoin intrigued me for its philosophical and societal meaning. Throughout history, we've seen that individuals seek alternatives when trust wavers in people or institutions.
This principle holds immense significance in asset management. Investors choose to trust you with their funds. Preserving that trust is paramount and it hinges on honesty and transparency. This involves candidly addressing risks and their potential impact. It's a personal decision whether to accept the risk, but dishonesty can erode years of trust-building and jeopardize everything you've worked for. Hence, the growing interest in digital assets might signal a decline in trust in certain aspects of our financial system.
There are, of course, various opportunities and challenges for both. When I first walked into the office of Hodl, I had the feeling that I entered into a venture organization, yet Hodl had left that stage already. What I’m implying is that you can feel the curiosity and drive of the people in the air, which creates a very unique feeling. When I had the opportunity to talk with the various departments within Hodl, I could see and feel that every individual was absorbing the newly provided information. As constructive feedback was given, you see that this feedback was enthusiastically taken into account and that individuals admit that they have other ways of approaching the issues they are dealing with.
You can feel the openness of the team and that it’s a very healthy environment. As aforementioned, I led many teams, so I know when individuals have other intentions or objectives than they say. However, I don't get that sense here. There's a clear objective—to make a mark on the international stage and become an integral part of the digital asset industry. Currently, everything is poised for success. Hodl possesses the drive, the people, the expertise and the competitive edge needed to achieve this goal. Nevertheless, the most challenging phase now begins—the execution. One of the opportunities is that Hodl has a head start compared to other players, as the industry develops and new - but also established - institutions enter the sector, gaining momentum from scratch is undeniably tough. However, this brings its own set of challenges.
The primary challenge for Hodl lies in establishing a prominent presence in the industry within a relatively short time frame. This has to be accomplished through thought leadership — offering unique insights to assist new investors in this market. Such efforts are pivotal in building the essential trust required in the asset management industry. While Hodl is adept at navigating the digital asset market, many will find it entirely novel and absorbing this wealth of new information may pose a hurdle. Hodl can leverage its wealth of knowledge to drive thought leadership and instill trust. However, as always, the challenge now is execution.
In an evolving industry, unexpected events, often referred to as black swan events, are inevitable. Their specific nature remains uncertain until they occur. For Hodl, it's crucial to proactively identify and mitigate risks. While strides have already been taken in this direction, it's important to maintain a continuous commitment to risk management. The organization should consistently ask itself "What if" questions to stay ahead of potential challenges.
Additionally, there's the risk of an economic downturn, which can be unpredictable and challenging to prevent. However, as I mentioned earlier, the focus should shift towards how the organization plans to navigate these risks.
Another factor introducing potential risks is the ongoing development in the industry, particularly as regulations become more prevalent. While regulations provide much-needed clarity, they also impose a standard set of rules for all market participants to abide by. This levels the playing field, prompting organizations to adapt in similar ways. In this environment, differentiation becomes paramount. What sets Hodl apart and why would (new) investors choose us? This pursuit of distinctiveness will be a critical aspect in the coming years. It's important not to try to do everything, but to focus on what makes Hodl truly unique—this will be our challenge.
Having spent a significant portion of my career in some of the world's largest financial institutions, it's clear that they are constantly at the forefront of technological advancements. Throughout history, financial institutions have shown a keen interest in adopting emerging technologies like computers, early digital environments, and the use of quantitative models. This same interest extends to the exploration of digital assets and distributed ledger technology, which offer unique advantages particularly valuable for larger institutions.
One such advantage lies in enhancing operational efficiency. Digital assets and distributed ledger technology create a transparent and interconnected ecosystem, as opposed to the current segmented systems. This has the potential to eliminate many intermediaries from the process, significantly streamlining operations. With improved efficiency, firms can redirect their focus towards other crucial aspects. Another noteworthy aspect is the potential for advanced product structuring, including features like enhanced traceability, expedited settlements, fractional ownership, and increased accessibility.
Additionally, the industry will likely witness a trend of traditional financial institutions acquiring established players. As mentioned earlier, establishing oneself from scratch in a relatively new industry demands time and substantial capital. For larger companies, it often makes more sense to acquire firms that already possess the knowledge, expertise and industry connections. This mirrors a similar approach seen in the medical industry, where well-established institutions acquire smaller organizations that have achieved breakthroughs, as it's both time-consuming and financially demanding to embark on such ventures independently.
With the industry maturing and merging with traditional financial and capital markets, I’m looking forward to working closely with the Hodl Group team and witnessing the growth of both the firm and the industry. As I've mentioned earlier, the team comprises remarkable individuals, and I firmly believe that anything is achievable with their dedication. Moreover, I am enthusiastic about contributing my insights and experiences gained over the years, which I believe will greatly benefit Hodl Group's international endeavors.
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