Gustavo Schwed: Clinical Professor of Finance, NYU Stern School of Business

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Bio:

Gustavo Schwed joined NYU-Stern as an Adjunct Professor in 2013 and became a Clinical Professor in 2015. He teaches Private Equity Finance to MBA students. Professor Schwed had a twenty-five year career in the private equity industry, which included work at venture capital and large buy-out firms. During this time, he lived in and practiced private equity in the US, Europe, and Latin America.

Prior to joining Stern, Professor Schwed was a partner and Managing Director at Providence Equity Partners, the world’s largest media and telecommunications specialist private equity firm, with over $40 billion of assets under management. Working in the London office, he was one of the partners responsible for the firm’s European business. Professor Schwed participated in the fund raising of Providence VI, a $12 billion fund which was the largest industry specialized private equity fund ever raised. At Providence Professor Schwed led several transactions in the telecommunications industry, including the largest LBO in European history at the time and some of the firm’s most successful deals in recent years. Professor Schwed was a member of the firm’s Valuation Committee and Portfolio Committee, which was responsible for the oversight of the firm’s portfolio of over fifty companies.

Professor Schwed was named NYU Stern’s Professor of the Year by the 2015 MBA graduating class.

What do you do best?

I am at my best in complex situations which require a calm, rational approach as well as empathy and deep understanding of other people’s motivations.  This is what has made me effective in the deal business.  By understanding where others were coming from and resisting demonizing my adversaries, I have been able to foster a constructive atmosphere and navigate through difficult problems.  I am also good at using humor.  It diffuses tense situations and reminds everyone of their shared humanity, which is also very useful in tricky deal situations.

I also think I am a pretty good teacher.

What makes you the best?

I don’t think I am “the best” at anything.  I am reasonably self-aware which helps me perform well in the classroom and in business situations.  I am also pretty bad at a lot of things, which I will not enumerate.

How will you stay the best?

First I need to become the best! I think humility, self-awareness and curiosity are critical for personal growth and high performance.

Biggest success?

Being elected Professor of the Year by the students at NYU-Stern in only my third year as a Professor was a great honor and is definitely up there.  As a private equity practitioner, I was one of the leaders in the take-private transaction of the largest telecom operator in Denmark.  This was the largest LBO in European history at the time and a deal that few thought was possible.  It was also successful despite being done shortly before the financial crisis.

I am also very proud of what fine human beings my kids are turning out to be.  I can only take a small amount of credit for that however.

What are your aspirations?

Personal: To live a long, happy, principled and healthy life.

Business: To work only with people I like in situations I find interesting.

Most challenging moment?

I was living in Brazil and practicing private equity there in the late 1990’s when the currency collapsed. Everything I had done turned to smoke and I thought my career was over.  My career has been like a good cyclical business: successful but bumpy.

What fascinates you?

How creative people create.  How is it possible, despite the billions of songs out there, all utilizing essentially the same chords, for a musician to create something beautiful and totally original?

Favorite Motto:

“Mind the light”

Favorite People:

My wife, of course!  I deeply admire people who have overcome enormous adversity to effect profound, positive social change such as Martin Luther King and Nelson Mandela.  Most people would have sunk into hatred and retribution and therefore been unable to change the world as they did.  I must also mention Barack Obama, who has the intellect, sensibility, ideals and heart to deserve to be our leader. I am also a great admirer of Jeff Tweedy, whose music and poetry nurtures my soul.

Favorite Places:

The Sonoran desert in Arizona for its stunning beauty. Many places in Italy: the dolomites, the lake region, Tuscany, and the Amalfi coast.  The Luberon in Southern France.  Chaotic cities in developing countries such as Rio and Hanoi.  The South African wine-lands are up there too.

Favorite Products:

The liberal arts education if I can call it a product.  It is a great luxury that lasts a lifetime.

Current Passions:

Music: it gets me out of my head and connects me with beauty. Travel: a great way to keep an open mind.  Education: an area where I think I can contribute and make a difference.

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Prior to joining Providence, Professor Schwed was a Managing Director of Morgan Stanley Private Equity, where he launched and ran the firm’s Latin American private equity business out of the firm’s Sao Paulo office and became the Chairman of the firm’s Global Emerging Markets Fund, Morgan Stanley’s vehicle for private equity investing in Latin America, Asia, and Central Europe. He subsequently moved to London where he became one of three partners running Morgan Stanley’s European private equity business. Prior to joining Morgan Stanley, Professor Schwed was an Executive Director at Bassini, Playfair + Associates (BPA). He helped BPA raise and manage a $300 million Latin America private equity fund, one of the first of its kind. While at BPA, Professor Schwed moved to Brazil where he opened and co-ran the firm’s Brazilian office. He began his post MBA career at the New York office of Sprout Group, the venture capital affiliate of Donaldson, Lufkin & Jenrette (DLJ) where he developed the firm’s practice in medical devices venture investing.

Professor Schwed currently serves on the Board of Managers of Swarthmore College, where he is Vice Chairman of the Finance Committee and is a member of the Nominations and Governance and Investment Committees. As part of the Investment Committee, he is responsible for the oversight of the college’s endowment, focusing on the endowment’s investments in private equity and public equities.Professor Schwed received a BA with High Honors from Swarthmore College in 1984 and an MBA from the Stanford University Graduate School of Business in 1988. He is a US, UK and Argentine citizen and speaks English, Spanish, and Portuguese.