Trebizond Investments, LLC, a private, student-run investment group, liquidated its investments to merge with Georgetown Collegiate Investors, LLC Feb. 2, creating the country’s largest private, student-run investment group.
Trebizond’s private equity branch, Trebizond Capital Partners, will remain independent.
The two groups were competitors but decided to consolidate their efforts after negotiations throughout the fall semester.
“It really doesn’t make sense to have duplicate clubs on campus trying to do the same thing,” GCICEO Joseph McIlhattan (COL ’14) said.
Trebizond, which had 150 members, was founded in 2011 by current CEO Caspian Tavallali (SFS’14), who had previously been secretary of GCI. The two groups used similar investment models, with club members providing money for investment. However, GCI, which was founded in 1997, bases their approach on a four-year horizon, while Trebizond focused on short-term investment in a volatile market — differences Tavallali and McIlhattan said will complement each other under the new, united organization.
“Where GCI lacks, I think Trebizond provides, and vice versa,” Tavallali said. “I think it’s a solid company, which we are supporting and expanding.”
“We are hoping to take some of the good stuff [that Trebizond did], and then … use our investment strategy that has worked, and, hopefully, we’ll get a great result,” McIlhattan added. “They bring capital and talent to the table, which we are excited about. I am glad that Trebizond is joining our model.”
According to McIlhattan, one of Trebizond’s greatest strengths is its use of a blog system called Capitalist Connect, which allows members to post potential stock ideas, check investment rationale and keep record of the club’s transactions.
“We looked at Trebizond, and we saw something we liked. They had been using technology in ways that are very innovative,” McIlhattan said.
Not every Trebizond member will necessarily join GCI, in part because GCI requires every member to contribute $250 that is returned upon graduation. Trebizond did not require members to contribute any money to its investment portfolio, as most of Trebizond’s funds were contributed by Tavallalihimself.
Tavallali expects Trebizond’s members to add $25,000 to GCI’s $80,000, while McIlhattan was less optimistic, expecting approximately 20 new members, which would bring $5,000 to the club.
GCI has taken steps to incorporate Trebizond’s members into its management structure by extending deadlines for applications to middle management positions. Tavallali is now chief development officer of GCI and plans to pitch some of Trebizond’s stock ideas to GCI.
“We are respecting prior experience from that [Trebizond] fund,” McIlhattan said.
GCI hopes to reach its goal of $100,000 in total investments before May — a goal that is more feasible with Trebizond’s added resources. Last year, the club had reached $95,000 before returning the graduating seniors’ investments.
Trebizond members are intrigued by the new group’s potential.
“I have cautious optimism,” Trebizond member Maxwell Roberts (COL ’16) said. “It can be difficult to merge, but in the end the two combined companies can have much success.”