The asset allocation will move towards;
70% in listed equities
20% in private equity
10% in venture capital
The overarching investment strategy is to;
Invest in high quality growth businesses
Take minority positions, backing talented management teams
Hold these positions and let them compound for the long term (5 years or more)
Over the course of a cycle, on average we will be 100% invested
When valuations are very high we can move to being 85% invested (15% in cash)
When valuations are very low we can move to being 115% invested (15% gearing)
At Middleton Enterprises, we don't try and time the market. We are not macro economists, and do not believe there is much value in trying to predict interest rate rises, levels of inflation or employment rates. Instead, we focus on identifying and investing in great businesses that do not rely on favourable market conditions. These are businesses that will continue to generate consistent profits and cash returns over the long term.
Middleton Enterprises has generated a compound annualised growth rate of 23% over the last 6 years. Over the same period, the broader stock market has returned 6% pa.
MEL’s investment strategy focuses on businesses where growth is underpinned by a technology induced, multi-decade structural driver. This allows for a long-term investment horizon.
When evaluating businesses, we have three buckets; Yes, No and Too tough. We will only invest in business models which we can clearly understand and avoid businesses that are not in our area of knowledge.
The strategy focuses on buying growth companies at a reasonable price. Firstly, identifying a structural driver. Secondly, screening for high quality fundamentals. Finally, investments are only made when the price falls below fair value. The valuation is calculated using a proprietary model. This is a simple idea but when executed is a key driver of outperformance.
The strategy only buys into opportunities which report clear, transparent and predictable operational KPI’s. This means we pass on +90% of businesses reviewed. Operational predictability is a key driver behind MEL’s 74%+ buy side success.
Conviction Equities Limited will be making this investment strategy available to external investors for the first time, from early 2020. Investors will have a rare opportunity to co-invest alongside an equity strategy with a consistent track record of growth. If you are interested in learning more or investing in this fund, please contact email@example.com
Performance to date
Purchase success rate
Outperformance of the FTSE All share every year since inception
Middleton Enterprises invests in fast-growing private B2B SaaS companies across the UK through our syndicate of HNWI’s, Conviction Investment Partners. CIP invests exclusively in post-revenue businesses that are disrupting their domestic markets and show the potential to grow into global enterprises with £100m revenue lines.
Our Venture Capital portfolio has generated a compound annual growth rate of 21% from 2013-2019.
Minimum revenue track record of 12 months
Plans to expand internationally
Scalable and repeatable business models
High annual growth rates
Demonstrable ability to become category leaders in local markets
Long term unicorn ambitions
External capital raised
Middleton Enterprises invests in and develops a range of businesses. These include regional SME’s and international corporations. Our PE strategy is to add value to portfolio businesses as well as creating jobs and wealth.
Cash generative businesses
Close founder relationship
Value creation through advice, expertise and finance
Long term development partners
Deep knowledge of the sector