Five tests, a written record, and three named exceptions.
Axion Investment Management manages capital from Calgary across venture capital, wealth and asset management, and family office mandates. The sequence below applies to all three. The detail differs for venture, private and public holdings.
Method
- § 1
Test
Every business we expect to hold for many years is put through five tests: cash conversion, pricing, management, the balance sheet under stress, and a written exit assumption. Most opportunities fail at least one.
Nº 01, Five tests before a long hold - § 2
Size
The portfolio is concentrated, so each position can be understood well enough to act on. In venture, reserves for later rounds are set aside at the first investment.
- § 3
Enter in stages
Capital is committed in tranches, often starting with a smaller first tranche than the initial discussion suggested.
- § 4
Keep a holding record
A written note of what each holding is, why it is owned, and what would have to change before it is sold.
- § 5
Review against the record
A position changes when the reasons recorded for it no longer hold. When markets are volatile, the question is whether anything in the record has changed. Usually nothing has.
- § 6
Name the exceptions
We move quickly in three cases only: correcting a mistake, meeting a capital call, and taking up an opportunity available for a short time.
Nº 06, Acting slowly on purpose
How the firm is set up.
- Products
- Axion has no in-house funds or investment products to place.
- Partners’ capital
- The partners invest their own capital alongside clients.
- Trading authority
- Agreed in writing with each client.
- Legal and tax
- Axion does not give legal or tax advice. Estate, trust and tax work is coordinated with each client’s own lawyers and accountants.
- Confidentiality
- We don’t name clients, and we keep a low public profile so the families and founders we work with can keep theirs.