There are a lot of things happening right now in the business of digital infrastructure. Tune in as Carrie Charles sits down with Jennifer Fritzsche as she breaks down how she foresees telecom and tech will intersect and what lies ahead for the future of the communications infrastructure. Jennifer is the Managing Director of North American telecom and communications infrastructure, Greenhill. She also shares what it’s like to be a female leader in a male-dominated industry and just how diversity has changed for women over the years. Check out her blog, Fritzsche’s Forum, for more on what’s new in the digital infrastructure scene.
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The Business of Digital Infrastructure and What Lies Ahead with Jennifer Fritzsche
I am excited to have someone that I’ve known for a long time, Jennifer Fritzsche. She is my guest and we are going to have a really wonderful conversation. Jennifer is the head of North American Telecom and Communications Infrastructure at Greenhill. Jennifer, thanks so much for coming to the show.
Thanks, Carrie. I’m flattered to be asked.
Let’s start, Jennifer. You have a long history in telecom. I’d like for you to tell us about your journey a little bit. I believe you have two board roles as well.
When you’re going down a hard path, it’s best to rip off the band-aid very early.
Thank you. I got into telecom and I call it a non-traditional way. I joined right out of business school in 1995. I went to work for a company called Everen Security. Everen was a small brokerage firm based in Toronto. I went to work there and ended up working as an associate analyst for the telephone analysts. I was the junior on that team. I looked back at that and won the lottery ticket. Those two gentlemen, which were wireless and wireline analysts, because in those days, they weren’t as blurred as they are now, I supported both of them. They both went on to bigger jobs.
I remember going to my boss at the time and saying, “Can I do this? You don’t have to give me a raise or an office even. I can do this.” They said, “You have an office and you don’t have a raise. Just prove yourself.” With that journey, I survived many mergers. I think the exact stat is, I worked there for 25 years and there were five different company names and the same phone number throughout. Wells Fargo eventually bought many companies that existed before that. That started with Everen where I started out of business school.
During those 25 years, I followed and that’s where I got to know you and a lot of people. I followed the telephone services cable for about three years before I left, and then comm infrastructure. The data centers and towers. I followed the towers when they went public. I remember when American Tower was $1.45 stock, which was amazing. I left Wells Fargo in July 2020. The reason for that was a few things. I was more worried about the cell site. A lot of our investors were feeling the pinch of money with moving onwards asset management. More importantly, I felt like I had been there for 25 years and I had an otherwise boring resume. It was time to move.
I was given the opportunity to be a minority partner in a fund that was raised for the CBM spectrum action, which was a wild and crazy ride. Our name was Canopy Spectrum. We were backed by Pepper Tree, Shamrock and Cloverway, as well as some smaller investors. We ended up being the sixth-largest bidder in the CBM auction. That sounds impressive but we really spent crumbs on the ground compared to the $45 billion of Verizon. It was a terrific experience. I learned from one of the best. I knew that was temporary. I wanted to get back in the real workforce.
As you mentioned, I also was asked to join two boards. I’m on the board and wireless telecom group with both amazing experiences. Very smart boards, excellent management teams, keeps me in the space. Greenhill found me via LinkedIn. I didn’t know anyone at Greenhill, but I’ve heard about the reputation. For those who don’t know Greenhill, it’s a non-balance sheet, pure M&A advisory firm. They wanted someone that had done a lot of work in Europe, in the communications infrastructure phase and wanted someone to be boots on the ground in the States. I joined there in April 2021. It’s been a lot of fun so far.
What an exciting opportunity. I remember, I saw you, I feel like, on every panel when we used to have actual events at conferences. You were always on the panels. When I first got in the industry, all I could think about was, “She is so brilliant.” You are so smart. I’m excited to have you on the show and getting to know you a little bit. Also, what’s cool is your blog. I don’t know how long you’ve had that but I want you to talk about it a bit. Every time I see you have a new one, I read it and it’s informative. I love your writing style. Tell us a little bit more about your blog. What is it?
It’s called Fritzsche’s Forum, which was the name of my newsletter at Wells Fargo before I left. If I miss one thing about my old job, it’s certainly my team and the writing. I went through a liberal arts education and I love writing. Greenhill has allowed me to keep this blog, which started shortly after I left Wells. I paired up with Digital Infrastructure Investor run by Tim Downs and Iain Gillott. It’s been a great portal for those of you who don’t know it. They’ve allowed me two things. They’ve allowed me the ability to write this weekly, becoming a bi-weekly blog on different themes in the industry, as well as do some interviews. I would love to interview you, short little interviews to talking about digital infrastructure themes.
In one of your blogs, actually, we’ll talk about a few of them. Let’s start with what’s your perspective on the state of communications infrastructure now?
It’s very exciting right now. As I mentioned my background, I followed wireless, data centers, towers. At that time, they were all very separate and distinct silos. What you see now is a significant blurring of the lines in so many different ways. If you had to whiteboard the communications infrastructure space, whiteboard four main squares. You have the towers, the macro towers, small cells, fiber, which I would argue is the connective tissue. I would say maybe those are the three main squares. There is somewhat of a data line which I think will become more of a straight linear line to data centers as they become a larger part of the conversation. The classic example about the whiteboard, someone running with that is Marc Ganzi, what he’s doing now with Digital Colony. I know they’re rebranding. He’s in many paths and connecting these dots. I think it’s going to be a really exciting few years.
Marc Ganzi was one of my guests on 5G Talent. Everyone, take a look at that episode. It’s awesome. There are many players in the 5G game. I was reading one of your blogs about this big announcement that AT&T made. What are your thoughts on the AT&T strategy?
I would know that for some who knew me as a data analyst, they would agree with this statement. I’m somewhat of a contrarian. I remember the days when everyone hated Sprint. I would also add including the team at T-Mobile and would talk about how invaluable that spectrum was. I always saw a hidden asset value there. I think what we’ve seen, I know there was a mob mentality to hate AT&T and Monday Morning quarterback, the bad decisions they’ve made, the Time-Warner and whatnot. That, to me, is all very rear-view mirror. Love them or hate them, the AT&T management team has made realize that they were going down a hard path. When you’re going down a hard path, in many ways, it’s best to rip off the band-aid very early.
Despite how hard a path it was to get Time-Warner, they realized that the competition was going to be too tough. More importantly, I think they realized that they were moving away from their core asset, which is significant. Those core assets are certainly the network side. Both the wireless, wireline, bringing the enterprise to group, both of those. The company rightly so, even with right-size dividends, being now we’re more unshackled in a way to invest where they need to invest. The consideration, that John Stankey and his team saw is when they were so aggressively going towards cyber in 2015, it may have been a, “Why did we ever stop?” moment. I think that once we realized that, that’s actually a good place to be, despite all the water cooler chitchat around it.
Let’s talk about the cable providers. What’s your perspective on the players? Comcast and Charter, what’s happening there? What do we see for the future?
I think cable has had it very easy for a very long time. I don’t mean to say they haven’t been front-footed in their own investment. The telephone operator is, for the most part, have sat in a fetal position in that fence. We talked through how that’s changing with the AT&T. It’s changing with Frontier, it’s changing with Windstream. Cable has to sit up and take notice. My very strong guess is they are. When I was an analyst, we would always start out our meeting, “Let’s assume cable’s the smartest in the room.” I think that is probably very smart to think that. They can’t be idle here. The Access 3.0 has been phenomenal for them, if you look at the upstream traffic, especially as we’re all doing what we’re right now and my children were doing during the pandemic, the upstream traffic cannot be ignored. The symmetrical nature of the fiber always will win versus the asymmetrical nature of the cable infrastructure. How cable is thinking about that is going to be key. I’m very much glad they’re thinking about it.
You talked a little bit earlier about the lines blurring and the communication infrastructure silos, where we are now and where we’re going. Is this blurring also touching the tech players to Amazon, Google, Microsoft? How will telecom and tech intersect? What’s the future of communications infrastructure going to look like?
I wrote in one of my blogs when I came back to work at Greenhill. I caught up with one of my favorite CEOs. His first comment to me was, “How do you feel now that you’ve come back and Microsoft is a telecom company?” It was in jest, but it was a very real statement. You look in those nine months that I was busy buying Spectrum, what has happened? Microsoft was very much being clear with their intention, that private networks, 5G is going to matter. You look at the two acquisitions they did with both Metaswitch and AFAR Networks. Those are communication plays. They have very much put their flag in the ground. Google is in a different way. Google Fiber has had stops and starts. It seems to be starting again.
There is definitely a morphing of the lines between them. I do remember, I’m going to go back to 2015, having a meeting with then COO of AT&T, John Stankey. I asked him “Who do you think is your competition?” His exact quote was, “It’s not just Verizon, it’s not just Comcast anymore. Bringing into the conversation, it’s Amazon, it’s Microsoft.” At that time, it was also Netflix. You really are seeing those changes and how private networks, especially from Microsoft and their 5G strategy, I think will be very much worth watching. If you look at Microsoft’s board of directors, you’ll see some very important wireless names there.
Talking about telecom leaders, and you speak with a lot of them in your work, and you have over the last 25 years or more, what did leaders need to know now as they look to the future? Any particular trends to watch, any challenges that lie ahead?
It has been challenging. I think that if you’re a telecom CEO, especially in services CEO, the question you have to ask yourself is, “What new businesses don’t cannibalize my current businesses?” That has always been a challenge. If you look at me it’s like, AT&T, Lumen, things like SD-Wan, that is a challenge to their MPLS business. You could argue that some of their legacy businesses are higher margin than these faster-growing lower-margin businesses. How do you balance? That is the real question. The answer is you think of businesses outside the four that are not cannibalizing yourself. Edge is a perfect example of that. One of my blogs was written about what Lumen and T-Mobile are doing. Going back to that whiteboard, Edge is becoming much more than a whiteboard concept. You have real Edge stories emerging right now. Before my time at Greenhill, I was an important advisor to one of the parties and the Atlas Hedge, which was the combination between Digital Colony and Liberty Global in Europe. I would very much see types of those types of transactions begin to translate here in the US. I think that’s going to be top of mind for the ambassadors or the company leaders.
Let’s talk about the state of M&A in the infrastructure space. What movement are you noticing? What are investors looking for? What’s on the minds of companies and leaders in the M&A space?
Learning from someone who’s been through the war room before is key.
Ever since I joined Greenhill, the amount of MNA that I’ve seen just even sitting in the seat is enormous. I don’t think it’s slowing down. There are many factors that you have to start with low-interest rates. For some of the smaller businesses, Lumen tech capital gains, change is an important vehicle. More importantly, it’s moving ahead of where the customers are going. We’re talking that the data center world was rocked with the announcement between QTS and Blackstone. I think these are very interesting stories that are going to continue to evolve.
The data center space is really interesting to me because you have these two extremely large players in Equinix and Digital. Number three player is CyrusOne, which is about a third the size of Digital, number two. That is an industry ripe for consolidation. Think of old regional banks or even old regional drug stores. Now they’re all Walgreens and CVS. I can see that happening in that space. You have to start also any discussion on M&A with fiber. It’s an overused term, but it’s the right one. This is the connective tissue that connects all these themes that we’re talking about. Some of the speakers I’ve heard on your past episodes are going to be really interesting M&A cyber friends. They’re the prettiest girl at the dance. A lot of people want to take them on the dance floor. I think towers. The tower factor has very much consolidated, but it’s still built to suit operators, but it will play a role here.
I want to switch gears a bit and talk about diversity. I’ve talked about this many times. It’s still a factor. There are very few women in the telecom space, very few women in the tech space. That is a concern for business leaders and hiring managers. In staffing, we get asked all the time, “We need more women. We need more diversity. We need more female leaders.” Yourself being a female leader in telecom and you have been for many years, I want to talk to you about what you see as the biggest challenge in recruiting women into telecom. What do you see exist there? Let’s say you’re speaking to these hiring managers and these leaders. What are some solutions that they can take away from this?
It’s hard and I don’t know if it’s unique to telecom. It feels very raw for telecom. You’re seeing change. Change might be too strong a word. I think you have to look at the board level and you’re really seeing some important improvements. I did look it up before. If you look at Verizon, 1/3 of their board is female. The AT&T, 25%. Ironically, T-Mobile is the last of the three at about the 12%. I think that’s changing because if you really look at the layer under the C-suite, especially at T-Mobile, there is a very female bent toward it. I would say that with AT&T and Verizon as well. I think you’re starting to see change, but it is hard.
I was on the diversity and inclusion committee at my old firm at Wells Fargo. The data is very specific that when women become at that childbearing age, you see a significant drop-off there. They think that the challenge is, especially in the wake of COVID, is how a company is going to be able to work to shepherd them through that period. I was lucky enough to be shepherded through that. At one point, I had 3 out of 3 twins in there. I worked for a gentleman and it was a man who just gave me what I needed. It was because that, I had felt tremendous loyalty toward him and relate to them and stayed there for as long as I could. I think companies have to begin thinking, especially in that critical stage for females, how to shepherd them through that. I do think you see certainly an awareness of it more than I ever saw. I felt like my situation years ago was unique. Now I don’t feel that as much. I can see that even at the firm I work for now. There’s very much awareness.
It’s interesting you say that it builds that loyalty when an employer will shepherd a woman through that time period. Yes, women will have to take the needed breaks in order to take care of the family. In fact, that really benefits the entire family. There’s lots of research that have been shown that families need that time when a baby’s born. The benefit to the employer is that loyalty that produces for years and years to come. What other benefits do you see for employers who really commit to women? Let’s say, the women, not all of them need the flexibility, but some do. The employers do provide that flexibility. What are some other benefits do you see to companies there?
Retention is number one. I think that the ability to be able to multitask in a way that’s effective toward work. My kids are now all grown, but when they were little, I get them down. I get through bath time and I get back on my computer. I think it was because they gave me the flexibility to just get it done. What is the saying? If you need something done. It probably leads into the question of mentors. I didn’t have any female mentors. The layer above me at my prior firm was a woman and she was wonderful to me. Most of my mentors in banking were men and they understood what I needed. I think that was actually extremely helpful in that process. The follow-through from me, and I’m sure other busy females, was always there. I didn’t allow myself to create a bear trap where they could be in to question the flexibility they were giving.
It’s also important that when women are recruited into an organization, they look and they say, “How many women are in leadership roles? Do I have a shot here?” In your opinion, what can leaders or companies do to really help promote women to more leadership roles?
I think that there are a few things. The flexibility, if they desire it. Secondly, creating layers of support for the women, even if it’s what I was on the diversity inclusion committee. That sounds so goofy because sometimes those committees don’t do anything. What we did was like a networking cocktail hour every three weeks. We’d bring in a female speaker. Things like that. Culture now, especially more than ever, it’s more than just the talking point and how companies really begin to foster that. I think it’s critical. In learning from someone who’s been through the war room before is key. Once they have a tangible example of that, that’s significantly helpful in that process.
Many women, what we hear is growth and development. It’s a reason why they leave companies and also something that they desire with new positions. Something else that we are hearing even more and more is that women are saying, “I don’t have a voice here. I don’t matter.” I’m hearing this even more. “It’s unfortunate that my ideas and my work, someone else is taking credit for it.” That still exists. What are your thoughts on that? How leaders can really transform that in their industry? They may not know what’s going on from the top.
That’s frustrating to hear that, to be perfectly honest. You would think that we’ve gone beyond that. Everything is shining the light on communication. This is where females have to approach it differently because it’s the whole Sheryl Sandberg type of discussion. I always feel shine the light on it, maybe go to that person who is taking credit and versus hiding behind an email, just say, “Can we talk about this? This is how I see this. Let me know if I’m looking at it wrong.” I think that is the way the communications for everything versus going right over the top to the boss. In any situation, I always don’t think it’s the right first step.
Secondly, combining grabbing someone maybe who isn’t in your immediate group. Having your personal board of directors and running it by them and always be open to feedback. I think that is huge. “This is the way I’m seeing it. What am I missing? Am I blind in this way?” It’s critical. I remember even making the leave from one job to the next. Someone gave me that advice about the personal board of directors. I could tell you the six I have. They all gave me different advice and then you put it on a plate and take it. I think that’s critical to anything but it’s unfortunate to hear that.
It’s still happening, unfortunately. I love that personal board of directors. I’m definitely going to implement that in my own world and give that advice to all the women that I talk to. Let’s take it a step further with advice. What advice would you give to women who really want to advance their careers in telecom or anywhere, and they want to move into those light leadership and executive leadership roles?
Reach out, talk, be a sponge. Sometimes, you might invite someone to LinkedIn. Don’t just say, “Can we connect?” I always add a personal note to say why I want to connect. You have to remember that people, for the most part, like to talk about themselves. If you let someone just learn from their journey and learn from their experience, they enjoy that. If they’re not emailing back right away, try again in a non-irritant sort of way. You’re probably like that. I’m like that. I miss emails. I miss LinkedIn connections.
When people follow up again, it’s just like, “My bad. I guess I have so many conferences, grabbing coffee with people, doing even a virtual coffee, virtual water on Zoom in the days we’re in.” It’s so much about building relationships. If I could say one thing about my career, it’s that I was never the spreadsheet junkie or the best at LBO analysis but I really fostered relationships. I think that’s so critical to everything. I would reach out in a way that is appropriate. Put your personal touch on it because that’s what people want to see.
Jennifer, I could talk to you for hours. Let’s tell the audience where they can go to find your blog and also learn more about Greenhill.
Thanks, Carrie. The blog is Digital Infrastructure Investor and if you click on that, there’s be like a little picture of me and it says Fritzsche’s Forum. Beyond me, there’s just a lot of great content on that. I would definitely recommend that. They’re trying to do an event, so that would worth watching. Greenhill is just Greenhill and Company. It’s a Google search. It’s been a lot of fun. I want people to know in any way I can help them think about things in different ways. What Greenville does really effectively is not only give financial advice with traditional bankers, which I am that brings in the layer of industry experience. I’ve been doing this for many years.
In fact, before we end, tell me more about your ideal client at Greenhill. Who would you serve the best?
It really runs the gamut. Certainly, any company in this space that might want to buy or sell an asset or get advice on a strategy. We all know there’s a lot of infrastructure money out there. I knew there was a lot. I didn’t realize how much until I got under the tent. We had very deep tentacles into a lot of this infrastructure money, much of which is in Europe and certainly here in the US. Connecting those dots is where I think we could be very helpful.
Reach out, talk, be a sponge. Foster relationships because that is critical to everything.
Jennifer, thank you so much for coming on the show. This has been fantastic. I look forward to reading all your future blogs.
Thank you so much, Carrie. I’m a big fan. Thanks for including me in this great group.
Take care.
Important Links
- Greenhill
- Fritzsche’s Forum
- Marc Ganzi – Previous episode
About Jennifer Fritzsche
Jennifer Fritzsche is Managing Director at Greenhill where she oversees the North American Communication Services and Communications Infrastructure practice. Prior to joining Greenhill, Jennifer was CFO, Manager & Board Member of Canopy Spectrum, a company focused on the wireless spectrum space. Prior to that, Jennifer was as Managing Director and Senior Equity Analyst at Wells Fargo Securities for 25 years where she focused on the Telecommunication Services, Cable, Data Center, and Tower sectors.
During her tenure at Wells Fargo, Jennifer received numerous awards including top rankings from Institutional Investor in the Communications Infrastructure space for each of the last 4 years (2017 – 2020). In 2020, Fifth Generation Media named Jennifer one of the Top 10 Women in Connectivity & Tech. Jennifer started in telecom equity research in 1996 with EVEREN Securities. Jennifer holds an MBA from Northeastern University and a BA in history from the College of the Holy Cross. She currently sits on the Boards of Dycom Industries and Wireless Telecom Group.
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