In a recent ION Influencers fireside chat, Neda Vakilian of Actis Capital Solutions made a powerful case for shifting infrastructure investment focus toward high-growth emerging markets. She detailed how core, defensive infrastructure in regions like India, Latin America, and Africa offers superior risk-adjusted returns, diversification, and resilience compared to saturated Western markets. With over $25 billion raised and a remarkable zero loss ratio since 2013, Actis’s track record demonstrates that “growth markets” are ripe with opportunity for educated investors.

Key Topics & Insights Discussed

1. Why Growth Markets Are Now a Strategic Imperative

• Saturation in West: Traditional infrastructure regions (US & Europe) face regulatory challenges (e.g., “Thames Water effect”) and compressed returns.

• Investor Shift: Allocators are reducing overexposure to North America and seeking growth, yield, and diversification.

• Higher Cost of Capital: Rising global interest rates make low-yield “super core” assets less attractive, pushing investors toward markets where capital achieves fair risk/return alignment.

2. Actis’s Definition of “Core Infrastructure”

• Baseline & Critical: Assets like toll roads, power distribution networks, data centers, and fiber optics that are essential, defensive, and irreversible once built.

• Greenfield Advantage: In growth markets, new infrastructure (e.g., renewables) addresses acute shortages—electrifying from zero—rather than displacing old assets, enhancing long-term defensibility.

• Contract Fundamentals: Actis seeks dollarized offtake agreements, inflation indexation, and sovereign guarantees to mitigate FX and regulatory risks.

3. Risk Mitigation & Investment Criteria

• Non-Negotiables: Long-term contracts, proven regulatory frameworks, government alignment, and experience with foreign direct investment.

• Portfolio Science: Actis uses a dedicated analytics team to balance risks across the fund—mixing greenfield/brownfield, FX exposure, and technology risks—to build robust portfolios.

• Local Presence is Key: Success requires being an “investment local, not a tourist.” Actis teams are embedded in markets, close to regulators, vendors, and exit buyers—ensuring transaction security and optimal operations.

4. Exits & Market Positioning

• Mid-Market Focus: Actis deliberately stays mid-market to maintain a deep buyer pool and avoid the “mega-deal” exit bottleneck.

• Proven Track Record: 230+ exits since inception, showcasing liquidity and returns even in perceived “hard-exit” regions.

• Rising Capital Inflows: Growing interest in the “global south” validates the strategy and expands exit opportunities.

5. Future of Infrastructure Investing

• Industry Consolidation: Expect continued GP mergers and a rise of specialists, with mid-market players thriving on value creation and downside protection.

• DPI & Exits are King: In a higher-rate environment, proven distributions (DPI) and successful exits will differentiate top performers.

• Private Wealth Channel: Significant growth anticipated as individual investors seek infrastructure exposure.

6. Rapid-Fire Outlook for 2026

• Exits: Moderate increase, but a backlog remains.

• Secondaries: Much more activity expected in real estate and infrastructure.

• GP Consolidation: Same or less than recent peaks.

• Data Storage Valuation: Inflated in developed markets, but still attractive in growth markets.

• Energy Services: Bullish on renewables as the irreversible core of energy transition.

• Private Wealth: Growing significantly as a capital channel.

Why This Matters for Investors

Neda Vakilian’s insights reveal a paradigm shift: the world’s most critical infrastructure needs—and highest potential returns—are increasingly found in growth markets. With a disciplined focus on local expertise, core assets, and risk-aware structuring, firms like Actis are turning perceived emerging-market risks into durable advantages. For investors seeking yield, impact, and diversification, the message is clear: look beyond the conventional map.

Key timestamps:

00:07 Introduction to the Fireside Chat
00:38 Neda’s Background and Role
01:23 Overview of Actis Capital
02:06 Understanding Growth Markets
03:18 Investment Strategies and Infrastructure Focus
05:22 Challenges in Current Investment Climate
07:00 Defining Core Infrastructure
08:59 Key Characteristics of Investment Opportunities
12:01 Navigating Regulatory Frameworks
14:34 The Importance of Local Expertise
16:29 Exit Strategies and Market Dynamics
17:59 Future Trends in Asset Management
21:27 Predictions for Future Exits
22:58 Closing Remarks and Insights