Legatum’s investment principles have been shaped over decades. While there is nothing particularly unique or controversial about our investment principles, the key to our success is the hard work and dedication it takes to relentlessly apply these principles day in and day out over many years.
The capital we invest belongs solely to Legatum. This is a rare privilege and offers a material competitive advantage in the world of investing. We have the freedom to make decisions based on carefully crafted convictions informed by deep and detailed research. This long-term approach means we can think clearly and make optimal decisions during times of great uncertainty. A sense of freedom and responsibility underpins the culture of our organisation and is the key to our ability to create long-term value.
We devote significant time to understanding the organisations in which we invest, analysing them in detail and also seeking to understand the macro-economic and societal trends that will shape their futures. We pay close attention to both leadership and an organisation’s culture as they are key to the long-term success of any endeavour. By keeping our portfolio concentrated, we can build genuine expertise in the areas in which we operate and maintain a close connection to the work that we do.
Experience, data and ‘gut instinct’ are all important when assessing ideas and making decisions, and we use a combination of all of these to guide our investments. We carefully study fundamentals to determine whether an investment has the potential to produce a compelling impact or outsized return. We also go beyond the data and pay close attention to the subtleties of human behaviour and sentiment which can provide crucial context to any investment. Applying both head and heart is something we aspire to do whether we are investing in a company or seeking to help break the cycle of poverty in a country.
Having our own resources gives us flexibility and an ability to act fast when an opportunity or challenge arises. The relationship we have with our portfolio is a live and evolving dialogue - that means if a business sees an opportunity to scale, a development project runs into difficulties, or we simply meet someone with a great idea - we are prepared to act by knowing enough, not necessarily everything.
We believe that true value and real change emerges over time, as a result of healthy relationships, good ideas, sound decision making and a lot of hard work. But none of that results in long-term value creation without the most important factors: patience and commitment. Legatum is deeply committed and uniquely configured to take a patient approach to all our investments and to maintain a deep network of valued relationships for the long term.