Meet The Disruptors: Alex Horn of BridgeInvest On The Five Things You Need To Shake Up Your Industry

Be Patient — Building great things takes time, and in order to build something sustainable, I would have to be patient and take measured steps each day that help get the organization towards our long-term goals.

As a part of our series about business leaders who are shaking things up in their industry, I had the pleasure of interviewing Alex Horn.

Recognized as a South Florida Business Journal “40 Under 40” award recipient at 29, Alex Horn is the Managing Partner and Founder of Miami-based BridgeInvest. He is responsible for the firm’s investment decisions and strategic growth, and under Alex’s leadership, BridgeInvest has become a leading real estate private lender. Over the past decade, Alex has expanded the company’s global distribution channels, institutionalized operations, and created a globally recognized brand that specializes in real estate credit.

Thank you so much for doing this with us! Before we dig in, our readers would like to get to know you a bit more. Can you tell us a bit about your “backstory”? What led you to this particular career path?

After graduating from Columbia University in 2009, I joined the Strategy & New Ventures team at SecondMarket where I helped establish new business lines for the firm and helped with larger-scale strategic initiatives. It gave me a background in fintech that provided some unique insight and perspective as I created my own company.

A few years later, in 2011, I noticed an opportunity to provide financing to the Commercial Real Estate (“CRE”) industry. Banks were forced to reduce their exposure to the sector as a result of the Dodd Frank regulations. This reduction in bank lending created significant opaqueness with respect to CRE financing. In short, it was a pivotal moment for the industry.

Having always been fascinated by CRE, my entrepreneurial spirit led me to become razor focused on what I could do to solve the problems I felt existed, especially as the industry was trying to recover from the Great Financial Crisis. That’s how BridgeInvest was born, and I wanted to combine what I love (CRE) while filling a void in the market.

Fast forward a decade, BridgeInvest, and our 30-person team, has become one of the United States leading private lenders by providing reliable short-term CRE financing across assets, geography, sponsors, and borrower types, including international groups, and providing our investors with what we believe to be a highly attractive risk adjusted return that is uncorrelated with the market.

I chose this route, knowing there was a significant opportunity for positive change and impact. What I hoped to accomplish with my firm — and I’m proud to say it’s what we’re accomplishing daily — was providing an institutional product combined with the nimbleness and high touch features of a boutique firm.

Can you tell our readers what it is about the work you’re doing that’s disruptive?

My team and I are in a business that previously existed on a much smaller scale, and we’re offering an alternative bespoke solution to clients.

In today’s economic climate, you likely see headlines showcasing challenges for borrowers as debt becomes harder to secure. This is caused by various things, from inflation, hikes in interest rates, and talk of a looming recession.

BridgeInvest has always been as optimistic as we are bullish, and 2023 has the potential to be a milestone year. Last summer, I saw lending pressure on the horizon with inflation looming and oversaw the creation of a transitional loan program to bridge the debt gap. That program provides non-recourse, interest-only loans to sponsors with assets with a proven track record.

This program is disrupting the status quo in two distinct ways. On the lending side, we are providing sponsors with the access to capital they need in order to stabilize and reposition their assets, while on the investor side, we are providing a fixed-income-like product with a risk-adjusted return that in my opinion far exceeding the public market. Indeed, in my opinion the risk-to-return metrics provided to our investors are disruptive themselves.

Our investors are critical to the future of BridgeInvest. Our team has built relationships that foster longevity, with a 90 percent plus retention rate for our investors, something not generally seen, especially post-pandemic. We’ve scaled our investment platform without distribution agents by building a unique capital-placement method.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?

You need clear, concise ways to convey your message to consumers. While the name BridgeInvest does have a purpose, when I was first starting, people thought we were only investing in literal bridges. Not necessarily a mistake, but in the long run, it taught me to be always ready with my elevator speech and share my company’s “about us” at a moment’s notice. I would like to note, to date we have never financed a bridge, but maybe one day we will.

We all need a little help along the journey. Who have been some of your mentors? Can you share a story about how they made an impact?

I am so grateful for the people who have helped guide my career. One of my greatest mentors is Daniel Ades. He runs a hedge fund in Miami and helped seed BridgeInvest back in 2011. Daniel is one of those big-picture types. His advice and counsel throughout BridgeInvest’s evolution has had a tremendous impact. He is someone I can rely on for advice and whom I go to when discussing the evolution of business and growth.

In today’s parlance, being disruptive is usually a positive adjective. But is disrupting always good? When do we say the converse, that a system or structure has ‘withstood the test of time’? Can you articulate to our readers when disrupting an industry is positive, and when disrupting an industry is ‘not so positive’? Can you share some examples of what you mean?

Historically, disruption is considered the less desirable avenue, but I strongly favor it. I always view it as the ability to process something in the industry and recognize that doing so differently is better. It cultivates conversations and causes evolution. Not only that, but it also challenges market players to stay energized.

A proponent of disruption that quickly comes to mind is technology. It is ingrained in every part of business these days, and it has opened doors and revealed ways to move forward for efficiency. For example, we have a proprietary asset management program and a sophisticated origination overlay on our CRM. On the investor front, we were a pioneer in being the first debt fund to use our investor servicing platform and now use it to manage over 350 investors worldwide. Capitalizing on disruption solves significant needs. It’s why we launched the company in the first place.

By leveraging technology and challenging the status quo, my team has created a professional and polished market offering that provides flexibility and speed in the transaction they need with an institutional caliber process and product. It’s an offering of a product that is differentiated from traditional banking, and we are confident that we’ve helped to break the historical perception that private equity is a less desirable avenue when seeking funds by coming out of the shadows and creating new products with reliable CRE financing and capital options. This is especially true in today’s economic climate, in which seeking funds from traditional lenders is nearly impossible. Private equity is a reliable alternative, perhaps the only alternative, to secure the capital necessary to keep the commercial real estate industry’s momentum and outlook positive.

Can you share five of the best words of advice you’ve gotten along your journey? Please give a story or example for each.

1. Be Patient — Building great things takes time, and in order to build something sustainable, I would have to be patient and take measured steps each day that help get the organization towards our long-term goals.
2. Celebrate the Little Wins — If you don’t celebrate the little wins often, you will get burnt out. To this day, every time we close a new investment, we have a song we play in the office. I will never get rid of this tradition or change the song we play. And, the song itself is a closely guarded organization secret!
3. Make Decisions with Integrity — This is the most important piece of advice I received. If you think programmatically about each decision you make and you make decisions with integrity, even if the decision was wrong in hindsight, you will not have regrets.
4. It’s A Lot Easier to Explain Return Than It Is Risk — Also, try to remind our investors that return is very easily quantified with a number while risk requires a much longer explanation and often can be biased. Always couch a return against the risk associated with that return.
5. Bad Borrowers Equal Bad Deals — This is the lender equivalent of “a tiger doesn’t change its stripes.” If a borrower has a history or litigation or disputes, often times that will happen again. It doesn’t matter how good the deal is, it’s rarely worth the time.

We are sure you aren’t done. How are you going to shake things up next?

I have my sight on tech integration. Technology has a powerful impact on business. I see its integration being successful in the CRE debt space with systems to price, monitor existing portfolios more efficiently and effectively, and to facilitate loan management. The industry has generally been more tech adverse, and I think there is an abundance of potential to continue to disrupt by continuing to build out our tech-enabled lending solutions.

Do you have a book, podcast, or talk that’s had a deep impact on your thinking? Can you share a story with us? Can you explain why it was so resonant with you?

“Principles” by Ray Dalio

He’s a master investor and founder of a truly iconic hedge fund. I find his thought process fascinating. I was inspired to emulate his “principles” at BridgeInvest in how I lead and how the firm functions. He has systemized decision-making, and I’m inspired by how they employ transparency in their organization. Indeed, after reading the book, I implemented a transparency policy at BridgeInvest, and to this day on our bi-weekly all hands call, my team shares all news. Good, Bad, Ugly, it all comes out. This culture of radical transparency allows us to have the right people at the table at the right time.

Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

“Knowing what you don’t know is more important than knowing what you know.”

When I think about this quote, it forces me to venture outside of my comfort zone and be 100% honest with myself to ascertain what I do not know. I then challenge myself to find the people who have an expertise in what I don’t know and to learn from them.

This quote also informs how BridgeInvest thinks about hiring. Each person we hire brings something new to the table, a different area of expertise, we use our collective knowledge set to continue to continue to better ourselves not only as professionals, but as people.

You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I think the world needs more tolerance, a kind of radical transparency. At BridgeInvest, providing transparency and clarity in what we do is fundamental to our goal, sharing that with our employees and extending it to our investors. We understand that we work with people and consciously focus on honesty, holding it as a core value. Transparency can induce collaboration, foster empowerment, and inspire respect in our relationships with others, professionally and personally.

How can our readers follow you online?

You can follow BridgeInvest on LinkedIn and our website.

Thank you so much for joining us. This was very inspirational.