The Mastercard Foundation’s $47 billion investment management arm has officially launched — and CIO John Barker is hiring for multiple roles at the newly minted Canadian institution.
Institutional Investor broke the news in January that Barker, who was previously CIO at Mass General Brigham, had been tapped by Mastercard Foundation Asset Management as its first-ever CIO. In the five months that followed, Barker has been busy building an operations, IT, and finance team, preparing to add investment staff, and working on the organization’s asset allocation policy.
“It’s one of the largest greenfield stand-ups of an asset manager ever,” Barker said by phone Thursday. “The size and complexity is really a once-in-a-career opportunity... I’m excited to build the team and diversify the portfolio.”
The Mastercard Foundation had been operating separately from the credit card company since 2006, when the corporation went public. The foundation held only Mastercard stock for years, a stipulation of its founding document. Now, the foundation is looking to harvest gains, derisk its portfolio, and grow its pool of capital.
The portfolio is a blank slate, and with $47 billion to invest, Barker and his team will be able to write checks large enough to gain access to top general partners.
“One of the lessons I learned in previous roles is how important the mission is to attracting high quality investment managers around the world,” Barker said. “In a highly competitive environment for access, mission matters. This is a terrific seat to be in.”
MFAM is overseen by an independent board, which consists of four members who also sit on the Mastercard Foundation’s Board of Directors. “Because it’s early days and it’s such an extraordinary opportunity, so much of our work is about alignment,” said Reeta Roy, CEO of the Mastercard Foundation. “The MFAM board serves as that bridge in terms of ensuring that deep understanding of where we’re going.”
MFAM still has discretion over its investments, allowing for a degree of independence from the board.
Barker stressed that MFAM will take its time deploying the capital. Part of that is baked into the management company’s formation Over the next seven years, MFAM will sell off about 13 to 15 percent of the Mastercard stock it holds annually, then reinvest that capital across asset classes.
“It makes sense to be patient with this,” Barker said. “It allows you to build deep relationships with your team and your investment managers and to make sure you have a relationship that can weather market cycles.”
Barker plans to start by investing in primarily actively managed funds, scaling up allocations to MFAM’s highest conviction managers over time. Then, he anticipates that the team will co-invest and even do some deals directly. Given MFAM’s location, this is a no-brainer: Canadian pension funds are known for their direct deal approach to portfolio management — and Barker already has some Canadian expertise on his team.
According to MFAM’s website, it has already brought on Ontario Teachers’ Pension Plan’s Jen Newman, Pete Simpson, Anthony Di Fonzo, and Jane Liu, all of whom work on the operations side of the business. IT leaders Denni Wong and Heinrich Zaguirre joined from CPP Investments.
MFAM has three listings for investment roles, although Barker said he expects to bring in between 12 and 15 people over the next six to 18 months. “One of the real assets here is being in Toronto,” Barker said of the hiring process. “We have a deeply experienced set of asset managers here.”
John Barker will be speaking on a panel about the formation of new investment offices at Institutional Investor’s Endowments and Foundations Roundtable in Boston in June. More information is available here.
