Lady Lynn Forester de Rothschild on E.L. Rothschild’s investments

Lady Lynn Forester de Rothschild, CEO of investment company E.L. Rothschild LLCIn 2003, Sir Evelyn de Rothschild and Lady Lynn Forester de Rothschild set up E.L. Rothschild LLC, a privately funded family investment company to oversee a variety of the Rothschilds’ global investments. Today E.L. Rothschild has made a number of investments in a diverse bunch of sectors across continents.

In this interview, Lady de Rothschild, the CEO of E.L. Rothschild, talks about the company’s investment philosophy and possible future directions in terms of investing in China and Africa. Excerpts:

(Watch the accompanying video below)

Q. As a company, how do you evaluate potential investment opportunities? Is there a guiding principle at work here?

A. We are long-term focused—our investment in The Economist has been for 70 years. We’re mainly interested in knowing and believing in the management team. So in terms of areas of focus, we are pretty opportunistic in terms of what is the best management team, doing the best job in any business. We’ve ended up to be invested mainly in the media and technology, real estate and consumer goods because that’s what we are seeing the opportunities.

Q. You have invested in very diverse sectors, including weather forecasting…

A. For CCTV (China Central Television, the national television broadcaster in China) in fact. We are the software provider for CCTV weather…

Q. So you’ve invested in diverse sectors such as agriculture (via FieldFresh Foods in India), media (The Economist Group, UK), weather forecasting (via Weather Central), as well as luxury and real estate. How do they all fit in?

A. That’s why I say, they don’t fit together. But they all have excellent management teams. They all have people that we believe in and we trust. And we’re involved at various levels. In the weather company we were deeply involved with management. In The Economist, we sit on the board. That’s really all we do, so it really depends.

Q. How do you really split your investments between emerging economies and the developed world?

A. Well, just to make your list more complicated than it already was, we are actually for the first time taking a very serious look at Africa. We were in India early. We should have been in China early. My husband with Rothschild Bank was here very early. He came after the Cultural Revolution ended, and he was the first major bank to come to see the government in the 1970s. We at E.L. Rothschild, missed a few boats, regrettably in China. We invested in India pretty early, and we are looking at infrastructure in Africa right now to add to your list. Where we find the management team, we’ll make the investment.

Q. It’s good that you mention China, because I remember you went to India and also to China and then choose India instead. Is that changing now? Are you looking for opportunities here?

A. We are looking for opportunities. We were here at the right time. My thinking was that back in 2004, $49 billion of foreign direct investment (FDI) had come into China, and in the same year $4.9 billion had gone into India. So my thinking was that, the delta couldn’t be that much that. We had a better opportunity to get in more on the ground floor. I was wrong, but I’ve been wrong before.

About Lady Lynn Forester de Rothschild:

Lady Lynn Forester de Rothschild is a former corporate lawyer and telecom entrepreneur. She is the CEO of E.L. Rothschild, an investment company she founded with her husband Sir Evelyn de Rothschild. E.L. Rothschild has investments in media (The Economist Group, UK), information technology, agriculture (FieldFresh Foods, India), weather forecasting and real estate. Lady de Rothschild is a director of the Estee Lauder Companies as well as The Economist Newspaper Limited.

Recently Lady de Rothschild became Co-Chair of the Henry Jackson Initiative for Inclusive Capitalism (HJI), a non-profit working towards building a more inclusive capitalist system. Among other things, HJI proposes that companies should invest in training, nurture small and medium-sized enterprises, and fix corporate governance.