Nicole Macarchuk – Angel Island Capital

Bigger isn’t always better. Need proof? Look no further than Nicole Macarchuk and the team at Angel Island Capital (AIC) in San Francisco.

Named for one of the Bay Area’s most treasured landmarks, the alternative investment firm doesn’t boast quite the assets of its more seasoned rivals. But that’s not stopping the firm from forging ahead with a strategy designed to foster opportunity in targeted areas—without losing sight of the benefits of scale.

Nicole Macarchuk | General Counsel and Chief Operating Officer | Angel Island Capital

As AIC’s general counsel and chief operating officer, Macarchuk is leveraging her 25 years of experience to help the firm broaden its sights—without losing sight of the assets that got it here.

“The fact that this is small boutique in the middle market space, but it has been able to attract such amazing talent is a testament to the culture and firm,” Macarchuk says.

Answering opportunity’s knock

A portfolio company of Golden Gate Capital, AIC and its investment advisor affiliate, Angel Island Capital Management, managed about $3.7 billion in assets as of Dec. 31, 2019.

Now the firm is setting its sights on a new targeted investment strategy—using a couple of different approaches.

One aim is to invest in syndicated, sponsored middle market corporate loans through its flagship Credit Opportunities investment strategy. A second aim is focused on privately originated corporate loans secured by hard or financial assets to sponsor-less companies through its Asset Based Opportunities investment strategy, Macarchuk says.

Those approaches are not unheard of, but the combination of expertise and deliberate methods for finding the best investments are crucial to AIC’s success.

“This is why Angel Island is so unique,” Macarchuk says. “It’s focused on where we want to build our scale with a clear and differentiated approach. We’re not raising assets just to raise assets.”

Making the choices

As part of the company’s private credit investment committee, Macarchuk is at the table helping determine which opportunities are best, and says the targets are annual returns of 13 to 15 percent for the Asset Based Opportunities and Credit Opportunities investment strategies.

“We’re raising capital we believe we can continue to deploy and still maintain the returns for investors, and to maintain our performance standards,” Macarchuk explains. “We want to put the assets to work—vigorously.”

While actively engaged in finding investment opportunities—a process for which she provides everything from due diligence to structuring the deals—Macarchuk is also bringing her expertise to the marketing side, which includes the launch of a website to accompany the new fund.

Protecting the firm’s brand is very much in focus, too.

A larger role

Bringing her legal expertise to the fore in the world of finance is nothing new to Macarchuk. She was general counsel of public markets and managing director at Kohlberg, Kravis Roberts & Co. Inc., which includes KKR Financial Holdings and KKR Credit Advisors for more than eight years before moving to AIC in January 2019.

What is new, she says, is her position as COO: taking a direct role in how the firm grows by developing and managing talent with training, goal setting and reviews.

Her expanded roles suit her abilities, says Peter Antoszyk, a partner at Proskauer, a New York City law firm specializing in fintech law.

“Nicole is fantastic. First and foremost, she is a very bright, insightful lawyer who brings business savviness to any matter,” Antoszyk says. “My experience has been that she is very, very quick to grasp a situation, distill it to its core and then bring a practical creative solution to any matter.”

Antoszyk adds Macarchuk is demanding of herself and others, but never at the cost of overlooking anyone’s efforts.

“She’s just a joy to work with,” he says. “She’s demanding of the highest degree of the legal services, but also appreciative of the efforts you put forth.

Controlled growth

In the year since she joined, AIC has also added several new employees (with more to come), mostly for the investment, finance, operations and client strategy teams. Like the investment approach, the firm is adding staff in a scaled manner, Macarchuk says.

That game-changing staff influx has also been concentrated on the C-Suite, where Macarchuk is joined by CEO and Managing Director Dev Gopalan, Chief Strategy Officer and Managing Director Lynette Vanderwarker and Portfolio Manager and Principal Zachary Jarvis.

All are onetime KKR colleagues, and Macarchuk considers it an all-star team—an assemblage of talent nearly unheard of in a boutique investment company.

“There is an element of deep domain expertise that enables us to really evaluate a number of investment opportunities due to expertise, experience and flexible capital,” she says. “Yet there’s no egos, no arrogance, just an element of modesty that comes from letting your work product prove itself.”

Indeed, if anyone knows how to let her work speak for itself, it’s Macarchuk, but her abilities have always impressed the partners at Paul, Weiss, a New York-based law firm that has worked with her as outside counsel over the years.

“We at Paul, Weiss feel very fortunate to have worked with Nicole in a couple of her roles,” partners Marco V. Masotti and Udi Grofman say. “It is always a refreshing and wonderful experience to be dealing with Nicole. She is measured, brilliant and respectful.”

Masotti and Grofman value her preparedness when they work together on new opportunities.

“We always walk away from our collaborations as better lawyers and advisors,” they say. “We look forward to accomplishing great things together in the years to come.”

Gaining experiences

Prior to her time at KKR, Macarchuk was general counsel and managing director at Och-Ziff Capital Management p, where she handled global transactions.

Yet the native of New York who earned her J.D. from Fordham University actually began her legal career as an intern in criminal law with the Office of the Bronx District Attorney, and also did some pro bono work before deciding she wanted to shift to corporate law by working with private equity sponsors and their portfolio companies.

Her career may not leave much leisure time, but when she, her husband, and two children get away, they really get away—most notably on safaris in South Africa and Botswana that were capped by a visit to the Seychelles Islands in the Indian Ocean.

“When we have quality time together, we like to have real experiences,” Macarchuk says, but their most recent trip put that to the test as the family arrived in Hong Kong at the height of pro-democracy protests. It was an experience that was harrowing and enlightening, she adds.

Back in San Francisco, Macarchuk has come full circle as she returns to a boutique-type atmosphere reminiscent of the early days of venture and growth capital investing. This time, though, she’s doing it with a sense of proportion.

“The thing I enjoy the most over my last couple of in-house opportunities is the growth opportunities and having a direct impact on the growth,” Macarchuk says, “and also learning from those experiences to ensure the growth is reasonable, scalable and focused.”