A Global Approach To Value Investing
Ellisville Harbour Partners is a Boston-based investment firm founded in 2021. We invest primarily in publicly traded global equities. Our goal is to provide superior investment returns that exceed global equity index returns for our partners. We specialize in frontier markets like China and Southeast Asia where our team holds significant first-hand experience and localized knowledge. As we invest globally, we also invest in North America and Europe as opportunities present themselves that meet our investment themes and rigorous investment criteria.
We take a new approach to traditional value investing. We look for businesses with large growing addressable markets. We also look for transformational technology that creates a technological, know-how, or business model moat around the company's core business. As value investors, we conduct rigorous fundamental analysis on each business we invest in and require a large margin of safety. Typically, we invest in 10 to 20 stocks of high quality businesses. We see ourselves as owners of the underlying businesses, partnering with company management, with the objective to grow with them over 10 to 30 years.
We look for large growing addressable markets where companies that meet our investment return requirements can outgrow the competition.
These are emerging markets both globally but also in the US, in overlooked areas such as the Midwest. We leverage our language skills and on-the-ground knowledge to invest in markets like China and SE Asia. If it were 1980 we would go to Japan. In 2005, we went to China. In 2021 we believe the frontier is not only SE Asia and India, but also in the former rust belt of the US where the economy is the fourth largest in the world (yes, bigger than Brazil and India).
We look for a wide technology, know-how, or business model moats around the company’s core business. We also look for older companies that are benefiting from transforming technology. Examples are multi-sided platforms, 5G, wifi-6, open source semiconductor, renewable diesel and gas, hydrogen, etc.
On average we hold 10 - 20 high quality businesses at a time. This provides sufficient diversification across industries and geographies, while putting all our investment behind our best ideas.
We are long term investors. We take a 10 year view on each company we buy. As an example, we first bought Taiwan Semiconductor (TSM) in 2010 for $10 a share, and its now trading around $120 a share.
We invest in companies that have a significant margin of safety. As Charlie Munger said, we do not mind paying a premium on a company if we believe its long-term value is much greater than today’s price.
2023 INVESTMENT THEMES
We look for businesses that fall into at least one of these investment themes:
Growth in Asia
This could be a company located in Asia or a company that’s located in the US, that sells its products and services to the Asian market.
Old Industry & New Technology
These are industrial, energy, and material companies benefiting from rapidly changing technology such as renewable energy, hydrogen, sustainable supply chains, AI and the cloud, etc.
Fast Growing Technology
These are businesses that are innovating in areas like 5G, wifi 6, IOT, AI, blockchain technology, open source semiconductors, etc.
By investing with us, partners will have exposure to a unique set of high quality businesses that are diversified in both sector and geography, but are also concentrated to benefit from significant growth over the long term.
With over 10 years of experience in China, we have unique knowledge along with an expansive network to conduct on-the-ground research in Asian countries including China, India, and Southeast Asia.
Through our connection to the Babson College Fund, our analysts and interns come from the countries we invest in. They speak the local language, have a global mindset and come with fresh ideas.
We have deep knowledge in the Energy, Materials and Industrials Industries and an extensive network in these sectors which give us a different perspective. This gives us a unique perspective on new technologies and clean energy. As we grow the team, we will add industry specialists to expand our areas of expertise.
Volitility is Not Risk
Volatility is our friend. Although we love investing, we do not get emotional about stocks. We see volatility in the stock market as opportunities to buy companies at great prices. We did not sell in March 2020 or 2008.
We view our clients as partners and most important assets. Our team draws on their network for ideas and support.
We see ourselves as owners of the underlying businesses and we like to grow with these businesses over a 10, 20 or even 30 year time horizon. We put our money where our mouth is, so much so that most of our liquid assets are invested in this strategy alongside our partners.
Strive to invest in companies with management teams that have demonstrated a track record of honest actions and statements. Partners who invest with us have full transparency in their investments through separately managed accounts.
A good investor is always trying to find the truth about a company’s fair value, and where that value is with respect to the current stock price. If we have a clear picture of what the company is truly worth (call it $100 per share), short-term volatility when the company's stock goes down (to $50 per share) provides that good entry point, also called “margin of safety."
Time in the market is more important than timing the market. We aim to put all our capital into our best investment ideas, and to let these ideas compound exponentially over time. Investing for the long term, and letting them grow untouched, provides the best outcome.
We are always learning. We are clear on what we don't know so we do not invest in industries we do not understand. Examples of this are Healthcare and Biotech.
Be willing to wait before investing in a company with a big enough margin of safety.
George W. Massey | MA, MBA, MSF
George Massey is the firm’s managing member and largest investor. He holds an MA Joint Honours in Economics and Chinese with distinction in Spoken Chinese from the University of Edinburgh and an MBA and MSF from F.W. Olin School of Business at Babson College. George is an executive in residence at the Babson College Fund where he spent 3 semesters on the Energy and Materials team.
Prior to Babson, George spent 7 years living and working throughout Asia. He spent 2 years as head of IR for AAG Energy (2868.HK) and 3 years on managing the Kirkwood Family Office in Beijing. Prior to Kirkwood, George worked in business development for Getchee Inc. in Taipei.
George has been involved in numerous entrepreneurial ventures since he was young including a pie and coffee shop in Beijing, and bought his first stock when he was 16. George comes from three generations of investors and still holds Markel (MKL) which was first purchased by his uncle in 1982 returning over 9000%.
We currently have 4 skilled analysts from Babson College. These rotating interns are selected from the highly competitive Babson College Fund program at the Cutler Center, where students are trained in fundamental analysis and stock picking. Interns are fully versed in rigorous modeling techniques, are fluent in Bloomberg, Factset, Capital IQ and many computer coding languages. We look for interns with a passion for long term investing who also speak local languages like Chinese, Thai, Hindi etc.