Using the example set by GYG and data from TAR, we explore the superyacht industry’s different markets.…
At The Superyacht Forum 2017, during the ‘Floating on the market’ keynote session, Remy Millott, CEO of Gyg PLC (LON:GYG), which began floating on the AIM stock exchange in July 2017, spoke about the experience of educating investors on the difference between ‘the billionaires’ market’ and ‘the millionaires’ market,’ both of which exist within the larger superyacht sphere.
From an outsider’s perspective, and perhaps even from the perspective of some within the superyacht market, the difference is a novel or linguistic one. After all, ultra-high-net-worth individuals are defined by most as owning assets with a cumulative value of $30million or more. And yet, the billionaires’ and millionaires’ markets perform very differently in a superyacht context.
“Many of the investors that we sat down with, we had to convince them that we were not in the 25m market, the millionaires market, we had to convince them that we are operating in the billionaires’ market…[and] that it was a legitimate industry that they could invest in,” explained Millott. “The hardest thing was convincing them that we were weren’t part of the smaller end of the superyacht market that went through a lot of pain during the financial crisis…we had to defeat the preconceptions that the market we operate in is cyclical.”
In The Superyacht Annual Report 2018: New Build (TAR) the statistics clearly highlight the difference in the stability of the 70m-plus sector – the ‘billionaires’ market that Millott alludes to – and the sub-70m sectors. Unlike the 30-70m portion of the market, the 70m-plus sector has remained resilient, regardless of market fluctuations, including the well documented downturn that has occurred in the post-2008 Global Financial Crisis era. As a result, the large superyacht market arguably remains the most investable portion of the market because of the stability it has been able to prove year-on-year.
