Principles
The 9 principles that define our conduct
1. We are a principles-based investment company.
We do what is legally, ethically and morally right irrespectively of how we are formally and informally rewarded. Our choices are coherent with our values, purpose and strategy. When in doubt, we always follow the more conservative approach.
2. We believe in deep, meaningful relationships.
We genuinely care about the well-being of our clients, business partners, co-workers and the companies in which we invest. We believe it is our mission to help people, companies and institutions achieve their full potential financially, socially and intellectually. We proactively develop and cross-mentor one another.
3. We believe in collective action, not in stars or divas, and come to better answers as a team than as individuals.
We support each other. We are a “One-Firm” firm, with no silos and no “brilliant jerks”. The Archipelago is a network of relationships – inside and outside our 4-walls. We believe that to find, nurture and coordinate its collective intelligence is immensely more powerful than to rely mainly on our internal team IQ.
4. We are real economy investors, and not financial wizards.
We believe great businesses governed and managed by lucid, honest, competent people, are the world’s most powerful wealth and productivity linchpin. Owning shares in a few of these exceptional companies for long periods of time is one of the most rewarding investments one can make. Still, perfect companies do not exist: we aim at finding and helping out the very few that can become great investments. Margin of safety is so much more than the supposedly objective price-value discount you pay at entry.
5. We are a strategic, collaborative partner focused on helping smart, lucid people at the companies we invest in.
We invest with a business owner/partner mindset and see ourselves as stewards and co-creators of long-term value in our invested companies: we help pinpoint and address the board issues that matter, leveraging not only our experience, but our social ecosystem – the Archipelago Network.
6. We don’t invest outside our deliberately narrow circle of competence.
We only invest our team’s time and attention in sectors in which we believe our experience and network can provide us with a clear edge, such as consumer goods, retail, services and selected industrials.
7. We are independent thinkers and process makers, not takers.
We actively craft our mental models and frameworks (GEM). We design our information supply-chain in order to understand signals differently and faster than the average market player. We live in an actively designed and crafted pull (not push) information consumption mode.
8. We are aligned with our long-term stance in the way we charge our clients and compensate our team - no bonus, just equity.
We will not design compensation structures or investment vehicles with terms that motivate us to pursue short-term gains.
9. We help people and institutions improve their understanding of investing and its risks.
We take an active role in helping them revisit the concept of performance and better understand the quality and magnitude of the risks they incur. Risk is not volatility, and inhabits unusual places . Performance is easy to measure and hard to understand. It is best appraised in long enough periods of time and if compared to what matters.
