The Arowana investment philosophy is underpinned by a belief that strong investment returns can be generated whilst maintaining a commitment to sustainability, an entrepreneurial resilience that comes from real life business building experience and a long term investment horizon. Our investment process is time-tested, data driven and forensic. We have demonstrated that this process is not influenced by populist thinking and we are comfortable being contrarian where appropriate. What is uncommon about Arowana is that where others would have given up on an investment, we have persisted and eventually delivered highly profitable returns. This is because our team comprises primarily of seasoned entrepreneurs and operators that have overcome a myriad of challenges to fix, build, scale up and successfully sell businesses.
Since inception not only have we delivered very strong returns but importantly have not realised any investment losses across our various companies or investment funds. We believe our genuinely entrepreneurial culture, focus and never-say-die resilience have been the primary drivers contributing to our results to date.
The Arowana team has bought, fixed, scaled up and exited businesses in sectors as diverse as enterprise software, road infrastructure services, education, power and electrical services, industrial testing, solar energy and asset management. In the process, we have created thousands of jobs and considerable economic value. As with any entrepreneurial journey, it has never been straight forward and is never linear. We have encountered and had to overcome numerous challenges with every company we have been involved with, including some situations where both external and internal stakeholders considered it be a lost cause.
Today, our investment philosophy and process is guided by our B Corporation certification. Our commitment to the B Corp triple bottom line of People, Planet and Profit is absolute and impacts every decision we make, including the sectors we will invest in and the type of people we hire.
Under Arowana’s watch and management, many enterprises have overcome significant challenges and flourished. Here is a look at some of our key successes:
- The global enterprise natural language processing AI software company RuleBurst (formerly known as SoftLaw) was a struggling small cap stock listed on the Australian Stock Exchange (ASX). It was privatised in November 2004 by a consortium led by Kevin Chin who became the joint-largest shareholder and the hands-on CFOO of the business. With only 6 weeks of cash to survive, the business was turned around in a mere 9 months and transformed into a global growth story. From humble origins in Canberra, RuleBurst scaled up globally into the United Kingdom, United States and Asia. It achieved a prestigious ranking in the Magic Quadrant report by Gartner as an enterprise business rules engine leader and was acquired by Oracle Corporation in November 2008. RuleBurst’s original consortium of investors received a 13.8x multiple on their fully paid ordinary shares (representing a 93% IRR) and a 2x multiple on their preference shares.
- New Zealand headquartered vocational education group Intueri Education was established by Arowana in June 2010 and initially comprised one college in Christchurch, New Zealand. Within 6 months of acquiring this college, 2 devastating earthquakes condemned the campus building and rendered the business practically inoperable. Where most would have given up, the Arowana team parachuted into Christchurch and rebuilt the business literally from the ground up. In the following 4 years, Arowana orchestrated a buy-and-build programme that saw Intueri’s profits increase 20-fold culminating in a May 2014 IPO delivering a 7x multiple of invested capital and a 129% IRR to Arowana.
- Singapore headquartered, human resources, events and media publishing company HRM Asia became part of the Arowana operating companies stable in April 2013. Subsequently it became the largest business of its kind in Southeast Asia, growing by 20% per year on average. In September 2014 it was acquired by Diversified Communications, a global events company, delivering a 2.5x multiple of invested capital and a 100% IRR to Arowana. These returns were achieved without any financial engineering but reflected underlying operational improvements and growth minded management.