Doing good is good business
Alquity is a $100m high growth UK based asset management company with a difference. Our unique mission is to transform how our customers invest by providing financial products that deliver great returns, by building our portfolios in a responsible way and by putting something back to the areas we invest in.
We’re not a charity or a business burdened with a heavy social conscious … we are a commercial business and we exist to make money for shareholders, returns for investors, and proving at the same time, that business can create life-changing opportunities for some of the poorest people in the world. Our aim is to show that business can be a powerful force for good!
By 2019, our plan is to have a fund size of $1 billion, increasing revenue from £1.3m in 2014/15 to £18m and generating a 2018/9 EBITDA of £9m and an EBITDA margin of 50%.
We believe that Alquity is very scalable with high revenue growth potential (900%) from a limited increase in expenses (10%).
History of Alquity
Alquity was founded in 2010 by Paul Robinson, who spent 20 years building financial service businesses, including a $0.5bn fund management business in Hong Kong. In 2003, Paul funded and helped build Global Ethics, the socially responsible company behind One Water.
Paul identified three unavoidable global megatrends driving investment returns and consumer behaviour and built the Alquity business model to provide solutions:
- Search for Growth – The potential of rapidly growing frontier economies across the globe to deliver fund growth even when developed economies are stalling
- Sustainable Investment – The rapid growth of the Environmental, Social, and Governance (ESG) sector, and a growing understanding of the extra performance dimension which results from putting sustainability at the heart of an investment process.
- The rise of the ethical consumer and Corporate Social Responsibility – Increasingly an important part of corporate policy, ethical consumerism is now a global trend with investors seeking to invest their capital in a way which benefits society
We believe Alquity is unique in the asset management space
We aim to achieve great returns for our customers while creating a better, fairer world for all. How?
By offering investment funds designed to achieve a Virtuous Circle that’s in everyone’s best interests.
ATTRACTIVE RETURNS : Our portfolios are designed to only include well-managed, responsible businesses, in high growth regions, that deliver better returns, over the long run for our customers. From Mumbai to Mombasa to Mexico City, our aim is the same: to seek out good companies that can generate great returns for our customers.
RESPONSIBLE INVESTMENT : At Alquity, we put our customers’ money into well-run, responsible businesses. These can be huge multinationals or much smaller listed companies. But what they all have in common is that they achieve success sustainably; that’s to say, by looking after their people, their communities, and our environment. We call this Forward-Looking Environmental, Social and Governance.
TRANSFORMING LIVES : We believe that everyone deserves an equal opportunity to succeed. So wherever in the world we pursue profit, we also put something back – by donating up to 25% of our fee revenue, to support local entrepreneurs and young adults in getting their careers and businesses off the ground. Transforming lives in this way doesn’t just feel good; it’s also good for our customers. Because, over time, giving a boost to local economies where we invest is sure to have a positive effect on how our funds perform. For more information about our Transforming Lives programme look here: http://www.alquity.com/#tab-3
We have been astounded by our progress
Alquity launched the Africa fund in 2010 with a fund size of $1m and the following milestones demonstrates the significant progress achieved:
- Africa fund reaches $10m
- Launch of funds on Friends Provident, Zurich and Royal Skandia platforms
- Africa fund grows by 20% to $12m
- Donations towards the micro-financing projects in Africa reach $65,000
- Africa fund grows by 300% to $40m
- £1.1m of new equity issued to support development of 4 new funds
- First investment by LO – major Swedish pension fund
- New partnership formed with our Charity partner “Afrikids”
- Africa fund reaches $80m, total fund size across all 5 funds hits $100m
- Launch of Alquity Asia, India, Latin America and Future World funds
- Donations made since 2010 are $500,000 helping to Transform an estimated 20,000 lives
- New partnership formed with our Charity partner “Amantani” based in Peru. (http://www.amantani.org.uk/news_2015_ict_suite)
Poised for growth in 2015
During 2013, Alquity raised £1.1m through an EIS share issues and the financing was used to launch 4 new portfolios and build the operational infrastructure required to support Alquity’s growth over the next 5 years.
Achieving Alquity’s business plan requires success in:
Listings on investment platforms – customers mainly buy our products through investment platforms such as Old Mutual or Zurich. It’s a similar principle to a consumer product business getting space on a supermarket shelf. Alquity has made great strides in obtaining listings on major platforms, which we believe demonstrates the unique power of the Alquity model; particularly as we are yet to find a similar sized asset manager which has achieved the listings that we have. We have a clear pipeline of new platforms were we are actively working to secure a listing on the platform.
Alquity Awareness – We believe Alquity products have a clear differentiation from our competitors through our unique business model which makes our products highly marketable. Raising awareness of the Alquity brand through the Independent Financial Advisors and brokers who are gate keepers to the end investors. Raising awareness involves a combination of direct sales, distribution partnerships, marketing at conferences and generating inbound leads via digital marketing.
In November 2014, Alquity determined £1m new investment was required to support the business plan. We successfully secured £450,000 in additional financing from the same group of investors who invested in 2013. Our intention is to raise the remaining £500,000 from the Crowdcube investor base as part of the £1m fundraise target.
Asset Management is a simple business
Alquity has 5 funds each covering the emerging market regions of Africa, Asia, India and Latin America.
A fund is a portfolio of around 40 companies whose shares are traded on an open stock exchange. Our team of fund managers combine their decades of experience with extensive ongoing research to select the best companies to include in our funds. We pick companies where we see huge growth potential that the company will deliver in a responsible way. We don’t run these business – our fund is shareholder of the companies in the portfolio.
When a customer puts money into one of our funds we buy more shares in the companies within our portfolio and in turn our customer gets shares in the Alquity fund. Shares in the Alquity funds can be bought and sold on a daily basis and the price of Alquity fund shares increases as the shares in the individual businesses increase in value.
In short, our funds are designed to be an efficient way for our customers to get the benefit of our expertise in selecting high potential business to provide financial exposure to the growth potential in emerging markets..
Alquity earns revenue through an annual management charge (%) which our customers pay based on the money they have put into our funds. Today the size of our funds is $100m and the annual management fee revenue is £1.3m. Over time our revenue will rise in direct proportion to the size of our funds.
The size of our funds is measured in US dollars reflecting the fact that our products are sold internationally in UK, Europe, Middle East, Asia and Latin America