Profile: Martin Sjölund, Summa Equity
The Drawdown (TDD): What prompted you to move from an external law firm to in-house at Summa?
Martin Sjölund (MS): Before I moved in-house, I worked at the law firm Mannheimer Swartling, predominantly on fund structuring. During this time I met Summa’s founder, Reynir Indahl, and the firm became one of my main clients. I ended up fortunate enough to be part of the team at Mannheimer that advised Summa on its first fund.
Following the fund’s closing, I was seconded to Summa on an interim basis. During this period, I became more familiar with the firm, its vision and how superior returns are delivered by making sustainable investments.
Having returned to Mannheimer, the opportunity came to join Summa full-time as the firm’s general counsel. I jumped at the opportunity, having been really impressed by the culture and people during my secondment. My joining coincided with the time Summa was going full-scope AIFMD.
TDD: Given that you already knew the firm quite well before starting in-house, what were your biggest challenges when you made the move?
MS: Transitioning from a Nordic magic circle firm to a young company was a challenge – my role at Mannheimer had been very specialised, focusing on private equity fundraising and linked topics.
Whereas, upon joining Summa, I immediately had to work across a broader array of matters. I imagine that this is very common for lawyers going in-house, especially if the transition is to a young firm. At Summa, we all sat together and worked across divisions, helping one another. Coming from the legal environment where one tends to stay in their lane, this was outside my comfort zone, which I enjoyed immensely.
It was an eye-opening experience. There can be so much more to law than just the pure letter of it.
TDD: Nordic private equity is a hot topic at the moment – what does its legal side look like?
MS: Private equity in the Nordics is relatively young, when compared with North America and the UK. However, the Nordics is a very attractive market and one that has proven its ability to deliver stellar returns over time.
The operational role of a general counsel is advancing and in most of Europe, I think it really came to prominence with the AIFMD legislation. AIFMD brought heightened scrutiny on the legal and compliance operations of GPs.
I think the European private equity industry needed the AIFMD, as it levelled the playing field. Increases in operational and compliance requirements require a legal counsel who is more involved than external advisers, and bigger fund sizes equally require closer attention from someone who understands the precise structure and is involved throughout the entire lifecycle, from establishment to then making investments and finally closing the fund.
TDD: Unlike other PE firms, Summa had a GC before it had a designated CFO. You mentioned how broad the role was in the beginning – how are things now?
MS: At Summa, I am responsible for three different remits: legal, compliance and tax.
We structure organisational decision making around stakeholders and topics rather than formal job titles, so on all legal, compliance and tax matters, I work very closely with our COO Hannah Jacobsen and our CFO Mohamad Ali Zahed. Our legal counsel Johan Carlsson handles much of the legal workstreams for our transactions. However, we are active across multiple jurisdictions and there is a lot of activity at any given point in time. Therefore, we will always consult external local advisers.
I invest a lot of time in evaluating and fine tuning our best practices, figuring out where resources should be allocated and what to outsource. In each of my assigned functions I look for patterns in order to optimise key areas.
TDD: Can you give me some examples of what this pattern recognition looks like in practice?
MS: Absolutely, but it also has a lot to do with ownership and accountability over a full deal cycle, which is very hard to get from external advisers. With respect to pattern recognition, it has a lot to do with defining house terms and practices and, to the extent possible, pushing consistency across the entire portfolio. Such an exercise can be as much about giving as taking, instead of pushing everything to the max for each transaction since consistency itself holds a significant value for us.
TDD: What are you most proud of since joining Summa and what will you be focusing on next?
MS: The collective journey with Summa is what I am most proud of. What started as Reynir’s vision has become this wonderful collective effort. As a team we have achieved so much, from the relationships we have with our LPs, the product and results we deliver, and that we are making good on our promise to deliver returns sustainably.
Personally, a highlight was handling the full-scope authorisation of Summa Equity AB as an AIF manager right when I started. It was a significant project and a great way to start at the firm.
In terms of looking at what’s ahead, I see my role as support and I mean this twofold. Firstly, for the firm: the legal team is demand-driven and our focus is to facilitate fundraising, transactions and operation of the AIF manager. But I am also a supporter of my team. We have just rounded it out and now my primary focus will be on how to set my colleagues up for the greatest possible success and ensure that I am a leader who has their back.
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PARTNERS IN EQUITY
Discussing the legal function, Sjölund shares his thoughts on whether general counsels need a seat at the partnership table: “In my eyes, there is no right or wrong, and it depends from firm to firm. I am very grateful and honoured to have been invited into the partnership but it depends on too many variables to make a general statement.” However, he points out that the nature of the GC function requires a leadership position: “You cannot get the policing required from this role without a certain level of seniority, as it will create too much of a dependence.”