McKinley Alaska Private Investment LLC, a part of McKinley Management LLC, is bullish on Alaska, according to McKinley CEO and CIO Rob Gillam.
McKinley was established in Anchorage 30 years ago by Gillam’s father Bob Gillam, based on the assumption that with the advent of the computer, money managers based in Alaska could be competitive with those based on Wall Street, Gillam said in remarks to the Anchorage Economic Development Corp.’s AEDC Voice Monthly Webinar June 9.
Gillam said that investors may not remember every detail of presentations he has made over the years, but “they always remember Alaska.”
“They always remember where I’m from,” he said.
As clients told him what they were looking for, Gillam realized it “sounds like home.”
“We turned the funnel upside down and funded a whole new enterprise called McKinley Alaska Private Investment with the idea of bringing capital from everywhere back home to make this place a difference,” he said. “We are thinking of Alaska-themed investment opportunities.”
Gillam said his firm coinvests with large, recognized global experts, with experience in capital and strategic asset allocations, be it oil, technology, or other areas. It works in three areas, private equity, direct investment, and direct lending.
Alaska is unique“Everywhere I go in the world, people know the word Alaska,” he said. “The mandarin translation for Alaska is Alaska; the Arabic translation for the word Alaska is Alaska; and all of those pools of capital - trillions of dollars - are looking for the same thing … a safe, secure place to invest a lot of money, a place where resources are abundant and there’s not too much competition.”
Alaska is perfect for those factors, and it is unique, he said.
“We’re very unique, even relative to other oil producing regions in that we have a very significant tourism component to our business … a very limited infrastructure … by some accounts we are 50 years behind the infrastructure development of the rest of the United States.”
“That’s $100 billion needed for ports and railroads, bridges and roads and other types of infrastructure, including technology,” he said.
Alaska is very central to the Arctic strategy of the nation, he said.
With federal and state spending down, private investment is needed, Gillam said, adding that there is more demand for money than there is money.
“We’re looking for best-in-class operational partners and capital partners to come here, who might not otherwise come,” he said. Alaska needs to get the word out.
Alaska is at a risk of the world passing us by, Gillam said, adding that Alaskans need to channel what his grandparents called the pioneer spirit.
“We have a history of making things happen, and this is our chance to do it again,” he said.
“Wall Street is really passing energy financing by, but … whether or not we all drive a Tesla, the reality is most energy production goes into petrochemicals, which include the production of plastic, which goes into your Tesla,” he said. “Until we solve that problem, oil and gas is still going to be a part of our economy, and if we can do it better and cleaner, of course we would like to do that.”
- STEVE SUTHERLIN