Entrepreneur and Investor Lars Windhorst Reflects on the Agricultural Sector, ABB-President Von Grünberg and the Dangers of a World Recession
Are you afraid of flying?
Lars Windhorst: No, fortunately I am not.
That is surprising, since you barely survived a plane crash four years ago.
That was really a dramatic and formative experience. I reflected on my life during the long period of recovery.
What were the results of that period of reflection?
I cannot answer that question in one sentence.
It's no wonder, since you had several disasters going on at once. In business you had reached an unprecedented high point and then suddenly you were on the ground. You were celebrated as a 16-year-old prodigy and even accompanied Chancellor Helmut Kohl on his trade missions abroad, but later your business group not only failed under a huge mountain of debt, but you were forced to declare private bankruptcy.
Many things went wrong, but not everything. Look at my history and you will understand that the dot-com crisis was one event that triggered the collapse of my business, but there were other reasons as well.
From a young age many fantastic opportunities came my way but through my own youthful exuberance coupled with my lack of experience, I did not pay attention to details. While my method worked for a while, I was undisciplined and with all of the hype surrounding me, I made gut decisions too quickly.
The hype was like a drug.
It was certainly enticing that at the age of 18 or 20 years I could enjoy all the glory and praise without thinking of the dark side, which unfortunately I got to know in full force. The dark side turned out to be very painful for me.
You have failed more than once but with help from your partners, you’ve always gotten back on your feet. Is this proof-of your charm?
As I said, not everything went wrong. In spite of many defeats incurred by my business partners, I always returned to a point of profitability. I was ready to work hard for a business that I believed in and I was an excellent salesman.
I became a salesman at the age of 16 and I stand by it. I have also noticed that I have a talent for quickly recognizing opportunities, pricing and market variations. I have been described by economist Joseph Schumpeter as the classic entrepreneur - an arbitrageur, who quickly recognizes the inefficiencies in various markets and uses them for business.
Schumpeter, incidentally, believes in the concept of creative destruction. What then are your new strengths?
I have not studied fixed structures and only recently began working with them. I left those decisions to the advice of more experienced professionals. It was too late when I realized that sustainability and perseverance are just as important as the initial sale, but I’ve learned that lesson now.
Tell us about your greatest success.
Although I have trouble describing them myself, there is not any one great success in particular. However, I do have the ability to quickly identify business opportunities that might not be apparent to others.
Is there something specific?
No. There is not one specific business transaction worth 5 or 10 million that I have handled. We have been successful in many business deals.
Which sectors did you invest in?
We have a long-term strategic interest in a number of sectors, such as agricultural production, mining, trade and logistics.
In the agricultural sector, you're not alone as there are some investors buying entire fields of wheat. Is that your goal?
That cannot be excluded, but it is not our focus. Instead, we are more interested in land management, including exploring methods to cultivate land as productively as possible.
In addition, Sapinda is the classic capital market business. Air Berlin is one of your favorite interests, but the company is not a strong performer. Have you been deceived?
The company suffers from the airline tax and other factors that affect the entire industry, without which the results would be much higher than last year. As investors, we have had good experience with the company over the past two years.
How important is Sapinda?
Sapinda’s importance is substantial, but I do not want to discuss it in public.
Employees are writing on social media sites that Sapinda has funded transactions of more than € 4.5 billion since 2004. In the past 12 months alone it should have been $ 1.2 billion.
We enjoy the benefits of working as a group, which allows us to make significant investments of sizeable magnitude.
Have you ever invested in Switzerland?
As part of the capital market, it is not unheard of. Otherwise, there are no activities in Switzerland.
This may indeed be the case with Switzerland. You have just established an advisory council presided over by ABB Chairman Hubertus von Grünberg.
Mr. von Gruenberg is one among several on the council. These outstanding experts advise us on long-term strategic considerations, such as how to relate to specific trends.
Who is sitting with Mr. von Gruenberg?
The Board will initially consist of seven international members, albeit mostly from Germany.They are all experienced presidents or heads of large corporations and come with high qualifications. We are going to announce their names shortly.
You may need professional advice, since following the capital market is like chasing the next earthquake. This also applies to Sapinda.
Although most market participants tend to exaggerate, there has been an extremely substantial boom in recent months due to the high liquidity in the market. Subsequently, we are experiencing a slump.
Will the downward slide continue?
I am convinced that a world economic crisis is not sustainable. Therefore, I do not see a doomsday scenario ahead. Since the whole world is in the same boat, no government has an interest in seeing the euro fail because if it does, growth in the U.S. and in Asia will be stifled.
That sounds a bit naive. Governments get the euro-crisis under control.
On the contrary, it is carefully considered. Because policy is often set with the intention of gaining favor with the voters, the initial economic decision is not always the correct one. Therefore, it is not as quick as we wish.
We cannot quite understand your optimism.
As regular investments, transactions and operations will continue, I do not see any reason for panic. As always, there will be people earning money as well as people losing money, which will trigger customary price adjustments. This is the normal cycle that we are accustomed to.
A systemic collapse is excluded?
I think this would be impossible.