(L-R) Carmela Mendoza, PEI Group; Lenna Koszarny, Horizon Capital
(L-R) Carmela Mendoza, PEI Group; Lenna Koszarny, Horizon Capital

New Private Markets parent company PEI Group was honoured to host Lenna Koszarny at our London offices on Thursday afternoon. Koszarny is the founding partner and CEO of Horizon Capital, the largest private equity firm in Ukraine.

Horizon has not only continued to operate throughout the war with Russia, but has successfully raised its fourth fund, exceeding its initial $250 million target and working towards a $300 million final close later this year. Investment professionals have remained in Ukraine since the invasion began.

The firm’s focus on asset-light technology and export-focused businesses gives its portfolio a natural resilience to the kind of disruption that war brings, and it is tempting to think this is the secret to the firm’s survival. Listening to the stories, however, it becomes clear that it is the resilience of the people involved with those businesses that is key to the firm’s success.

Koszarny recounted some humbling incidents of human endeavour from the portfolio companies.

She described how the chief executive of a business that exports to 169 countries managed to procure 20 10-ton trucks to shift the entire manufacturing plant to a new location on the EU border after the invasion in February 2022. They had exceeded pre-invasion levels of production from the new site by April 2022.

There is a retailer who went from having 863 stores before the invasion down to 636, as they were either destroyed or lost to occupied territory. Alongside helping distribute 200 tons of humanitarian aid, the company is now up to 970 stores. “He is opening a new store every 17 hours and his top line grew over 40 percent last year,” she said.

There was a remarkable story of a technician at a fiberoptic broadband business. The business was based in Kherson, which fell to Russian occupation. The technician, who remained in Kherson throughout the occupation, rescued a vital piece of equipment from being vandalised and hid it under his bed, so sure he was that Kherson would be liberated. Following liberation, the business was back up and running within 24 hours due to this piece of equipment. “How do you fight that?” said Koszarny.

When I asked her how the war with Russia had altered her view of an investors’ role in society, her response started with fiduciary duty: “You view your role as a fiduciary one; to be the best steward of capital, to invest it well, to realise it well.”

But it gravitated to the human: “You don’t expect everyone in your organisation to be heroes. You don’t expect you’re going to get a phone call that someone in one of your portfolio companies has been shot at a checkpoint in front of their wife and children.”

“As an investor,” she continued, “you are part of the community, you are shoulder-to-shoulder with the founders.”

For all that we write about worthwhile endeavours in the area of sustainability, impact investing and ESG, Koszarny’s and her firm’s stories of resilience are humbling, and gives us a valuable persepctive on the impact that an investor can have.