One of the first things you notice when meeting billionaire entrepreneur Michael Lee-Chin is his commitment to punctuality. And that, it must be said, has nothing to do with the fact that he often helicopters to work.
Both time and speed are of the essence when he conducts business. And the three-year hiatus after he sold AIC, the mutual fund powerhouse he built, to Manulife Financial Corp., has done little to curb his drive.
He’s unfazed by the fact that he’s re-entering the fund business when the industry’s in the doldrums. But that’s not to say his suite of public and private funds, planned to launch in October, hasn’t taken into account the current climate of low returns and high volatility.
“Our mutual fund offerings will embrace the opportunities the current climate provides to invest in growing, high-quality businesses at attractive prices,” says Lee-Chin, chairman of Portland Holdings, a Burlington, Ont.-based investment firm that manages public and private equity.
“In such markets, pricing is more likely to be inefficient, especially in private markets where information is not readily available and liquidity is limited.”
The firm’s alternative offerings will be available to accredited investors with a minimum investment of $5,000, and it’s also creating mutual funds with minimum investments of $250.
The MERs are expected to be “competitive within the industry.” (Portland will be operating an IIROC and MFDA dealership.)
Lee-Chin’s new venture aims to bring institutional-style investing mandates and strategies to individual retail investors. Both people and institutions need three things: capital preservation, income generation, and future income growth.
“If the needs of individuals and institutions are the same, shouldn’t the portfolio asset mix be the same?” says Lee-Chin, whose AIC amassed over $15 billion in AUM at its peak.
“We’re doing a private equity fund [where] retail investors will be invested right beside these eminent institutions.”
While the funds, particularly their alternative investments bases, will mostly be concentrated in North America, Lee-Chin concedes there’s quality beyond our borders. His own business portfolio comprises assets in the Caribbean, Turkey, India, and Latin America.
“We will continue, especially with our mutual fund offerings, to explore opportunities and asset classes across the rest of the world.” These areas include the Europe, Australasia and Far East (EAFE) region, as well as emerging opportunities in Brazil, Colombia and India.
Private equity for the masses
Investing directly in private markets, based on intelligence acquired through site visits, enables the fund to offer higher-yielding assets to investors who were previously excluded from such opportunities.