John Moran, who's resigning from the US International Development Finance Corporation (DFC) after nearly 25 years, has garnered a wealth of expertise in many topics crucial to Ukraine's future, particularly in de-risking and catalyzing private sector investment in tough environments.
From April of 2023 until January of this year, he served as senior adviser on Ukraine Recovery Initiatives, cooperating closely with Penny Pritzker, the US envoy to the reconstruction of Ukraine, and coordinating DFC projects for Ukraine with the private sector.
In January, he took a deferred resignation offer, which means he stays on rthe DFC payroll until September, but is effectively off the job. In the meantime, he's exploring the possibilities of a new life in the private sector in a consulting or senior advisory role, preferably focused on the reconstruction of Ukraine.
In a conversation with Ukraine Rebuild Newswire, John recounted a career in international economic development, spanning multiple sectors and regions. From his early work in private practice focusing on African markets to his more recent roles, he has consistently focused on mobilizing private capital in emerging economies.
Following are three tips for investors derived from the conversation:
John's 3 Tips for Foreign Investors in Ukraine
#1 - When Approaching a DFI, Come With a Well-Defined Deal
"Have a deal ready that's pretty well baked so you can actually answer the question going in of what role the DFI can play. Don't just say 'I have this big idea and I'm looking for this big slug of capital so can you introduce me to people?' We're not really matchmakers."
"In my position you see a lot of people and a lot of deals, and the deals that get the most traction are those that have a clear idea behind them of what the role would be for the DFI and that includes where the DFI fits in the capital stack. If you're looking for equity, that's OK. If you're looking for debt and/or political risk insurance, that could be OK too. But you have to have it all pretty well defined."
"You can't just say, for example, 'I want to do a $100 million building for food storage, and need investment capital and political risk insurance.' That makes it too hard for the investment officers and deal teams to pitch, and DFIs are driven, ultimately, by deal teams."
#2 - Research the Political Landscape, and Your Partners, Thoroughly
In a land traditionally dominated by oligarchs, who are typically avoided by DFIs, and shifting political allegiances, as well as corruption, it's important to know the people you're planning to deal with before you approach a DFI, he said.
"You're going to need fairly extensive knowledge about who your partners are, especially if you're dealing with somebody who has a history in Ukraine or when you're dealing with politically high-profile people."
"The international community will shy away from the oligarchs and they'll have an insistence on transparency and I don't think that will change."
"And it's the same when you're approaching a DFI. Know what they can do for you and know what your ask is. Sometimes you're asking for something specific but what you really want is that halo effect. You want to come in with, for example, the EBRD or perhaps bilateral DFIs on your side so some local authority doesn't screw you around."
#3 - Seek Local Professionals Who Can Guide You
Investors will have a tougher time persuading a DFI to support a project if they have no experience in Ukraine, John said, adding that a trip to Ukraine may very well change an investor's perspective on a given deal.
"Say you're somebody from Minnesota looking for political risk insurance on an ag deal. You know ag deals or grain deals backwards and forwards, but you've never done something in Ukraine. Maybe they've heard something that intrigues them but, man, they've never been there before. Sometimes they'll go and they see it's a lot different than they thought."
"There are very high quality law firms, engineers and other experts, and there are some very capable Ukrainians and international entities - major banks, but also local banks, that can help. Ukraine has a lot of commercial sophistication and people who know what to do."
"So the positive side is there are a lot of good people there who you can deal with, so that when you make the pitch to a DFI, they know that you're speaking with some knowledge. That always helps a lot with anybody who's talking to a DFI - or a private lender or insurer - about a loan or a political insurance application."
