Business model and strategy
The successful sale of Bank am Bellevue in 2020 marked the conclusion of the Group's transformation into a pure play asset manager. Over the past ten years, the business model that has served Bellevue Group so well since its establishment in 1993 underwent a gradual evolution and the company’s investment capabilities were broadened through a series of acquisitions. That and the successful organic development of the business have produced double-digit growth rates for Bellevue Group in recent years. Investor interest in healthcare, one of Bellevue’s core strengths, increased significantly during 2020, a year of health, and will likely remain high going forward.
Bellevue is a pure specialized asset manager with a distinctive focus on healthcare and other promising investment themes.
Our entrepreneurial business model is straightforward, transparent and highly scalable. Our financial profile is robust and low on risk. What makes us so unique is the force and strength of our proven expertise deployed in autonomous and accountable teams, which we coalesce into one strong and connected whole, framed and underpinned by our solid platform.
We seek and deliver growth through performance and innovation.
Value creation for clients and shareholders is our value proposition – accountability and responsibility toward all employees and business partners and responsible stewardship of the environment is our duty.
The solid quality of the Group’s earnings base enhances business planning processes and the clear-cut business model creates plenty of room for further efficiency gains. A debt-free balance sheet, a comfortable cushion of equity and the entrepreneurial bias of the company’s ownership structure allow Bellevue to maintain its proven strategy, which is distinguished by a balanced mix of organic and acquisitive growth as well as attractive distributions to shareholders.
Global reach thanks to international network and diversified platforms
Bellevue’s main offices in Zurich/Küsnacht, Frankfurt/Oberursel and London give it a strong international footprint. Licenses from regulatory authorities in Switzerland, the EU and the United Kingdom ensure its access to its core markets. A research unit in New York and representatives in Asia provide Bellevue with valuable local know-how and investment inputs. Strong and well-diversified platforms conforming to clearly defined standards facilitate the international transportability of highly scalable products across numerous European and Asian countries. Established alliances with third parties that are well-positioned in their particular local markets give Bellevue a global reach despite its lean structure.
Expertise, innovation and entrepreneurship drive the value creation process
Bellevue Group is a truly independent asset manager seeking to offer attractive and innovative investment ideas that generate value for investors as well as shareholders. Investors, shareholders and its own employees have long benefited from its ability to identify compelling investment opportunities at an early stage.
As a pure asset manager, Bellevue is pursuing a multi-boutique approach with a particular focus on investment themes where it can deliver superior investment returns with an active, benchmark-agnostic investment process. All of its investment solutions are characterized by specialization, quality and innovation. Bellevue’s investment professionals have long and strong track records and they are superbly networked with senior executives and leading experts in the industries they cover.
Product range – a balanced mix of «specialization» and «diversification»
Bellevue's offering comprises a clearly defined range of investment products and services. It covers three targeted investment areas – specialized healthcare strategies, alternative investment strategies and traditional investment strategies. This clearly defined investment spectrum offers investors a good balance between special themes and diversification, as well as access to sustainable growth stories. As a pure play asset manager, having a broad but sturdy earnings base and a diversified range of products and services for the various cycles of the capital market is crucial. This gives investors a range of timely investment options and lets them participate in Bellevue’s ideas yet at the same time ensures that shareholders’ interests are upheld.
Bellevue’s approximately 100 employees have many years of experience in the investment industry and they represent the backbone of the company. They are investment professionals as well as entrepreneurs. Bellevue employees have a personal stake in the performance of the products they manage, and thus the performance of their clients’ investments, because they themselves are invested in these products. «We eat our own cooking» – a high level of congruence with the interests of investors promotes discipline and entrepreneurial thinking and action. Portfolio management teams are given considerable freedom to achieve their visionary pursuits and assume a high degree of self-responsibility while doing so. This culture and agility contribute to the Group's innovative capacity and enable it to produce a steady stream of novel investment concepts. Every portfolio will, however, always exhibit a focus on sustainable earnings power and growth.
«House of Investment Ideas» as the foundation of the business model
Bellevue Group, one of the largest and most experienced healthcare investors in the world, has identified very compelling special themes within the healthcare industry that are backed by structural growth trends. Its broad and highly specialized range of healthcare strategies captures the zeitgeist of our times and has attracted increasing attention from the investment community for some time. An example of the long-standing and unique investment expertise Bellevue has in the healthcare sector is BB Biotech AG, an investment company that has generated value for investors for more than 25 years.
Bellevue is also steadily expanding its skills and capabilities in the field of alternative investments. Dynamic expansion has been achieved with direct equity investments involving healthcare and entrepreneurial businesses. Venture capital and entrepreneurial private equity vehicles that finance the growth of SMEs have attracted growing interest from a growing number of investors. The outlook for alternative investment strategies is bright and Bellevue intends to selectively expand its activities in this area.
Turning to traditional investment strategies, Bellevue was a pioneer provider of funds focused on entrepreneur themes and Africa. New investment opportunities were recognized at an early stage and made accessible to a broader investment community. These growth-based strategies are currently under pressure for market and structural reasons, as are defensive equity strategies as well as bond and mixed strategies. A constant rebalancing of the product range and the development of innovative ideas will help to create new growth prospects.
These three focused investment strategies represent the cornerstones of Bellevue Group's business model and its value proposition of creating sustainable value added for its clients, shareholders and employees. While the corporate culture, investment strategy and shareholder structure do impart considerable stability, the business model must still undergo a process of continual optimization to promote and protect the interests of all stakeholders.
A forward-looking, growth-oriented strategy with a focus on profitability
The key drivers of future growth are the investment performance of the existing products, the development of interesting new products and the acquisition of new clients. Bellevue has a solid platform and a sound strategy for achieving progress on all three fronts.
Growth = product quality + innovation + customer momentum
Bellevue is aiming to grow first and foremost with its established products – «Grow with the products». Its potential for growth in this respect is apparently quite high. This is also where the best earnings prospects lie, given the fact that a high degree of product scalability presents the most attractive marginal returns. Growing with the products will only be possible if the high level of product quality is maintained and adapted when and where expedient. Bellevue is constantly investing in platform modernization, including the related infrastructure and instruments, with that in mind. Maintaining high levels of portfolio management continuity and stability and effectively strengthening the investment teams with new talent is vital. Bellevue has proven that it is quite capable of recruiting and retaining the right people. 16 of its 19 lead portfolio managers have held this responsibility for the funds they manage since day one.
«Grow with the products» is also contingent on growing the underlying client base. Having the ability to win new clients and enter new target markets is critical here. Bellevue is firmly anchored in its domestic Swiss market and in its core European markets of Germany and the UK, where it still sees considerable penetration potential. Bellevue is also growing steadily in its strategic secondary European markets of Austria, Spain, Benelux and Italy – with both long-standing as well as recently acquired clients, especially in the demanding segment of large clients (global universal and private banks, pension funds and large corporations). In Asia, tangible opportunities have emerged thanks to the growing volume and maturity of the products on offer. Bellevue is still in the early stages of establishing a footprint in this region and currently developing its strategy to take growth to a higher level.
Innovation is a key growth driver, as already witnessed in the past. Bellevue is stepping up the expansion of its direct equity investment activities in the healthcare industry and other specific market segments, such as entrepreneurial investment in the DACH region, to take advantage of the diversification benefits and favorable market growth prospects. New innovative concepts for non-traditional and traditional investment vehicles are also being developed to enhance the current business model’s growth prospects. Greater resources will be directed toward other global themes ranging from «technology» and «environment» to «responsible investing».
Looking at the broader picture, then, Bellevue Group has a full pipeline of ideas and products for 2021 and beyond. At the same time, existing elements of its product range that do not have a distinctive profile or a sharp competitive edge will be repositioned or, as a last resort, removed. Bellevue’s strategy is not simply about size: it is more focused on high-quality, steady earnings and an attractive cost/income ratio.