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"If you cannot hide your mistakes from your clients, then your process will benefit. If you are bound to always do what you say, you're not going to be superficial...you will be forced to admit the evidence of hard data every day."
Paolo Mortarotti is founder and Chief Investment Officer of Tower House Partners—a fundamental equity, long/short manager in London.
Part of Paolo’s success as an investor lies in his ability to identify companies that have promising futures, but are overlooked by the market. He then applies what he calls a “peaceful activist” approach: (1) gain the confidence of a company’s management, (2) have an open and frank discussion about what they're trying to achieve, and (3) help the company imagine a greater future and move toward it together.
When it comes to transparency, Paolo may be an outlier. Most managers prefer an aura of mystery—not Paolo. In a field often shrouded in secrecy, Paolo believes that when companies and investors are upfront with stakeholders about their processes, everybody benefits.
Paolo graduated summa cum laude in Economics from Bocconi University in 1999. He then started his career at Cazenove on the European research team (which has nurtured several of the current London-based equity managers). Paolo continued his development as an analyst at Theorema before graduating to the portfolio manager seat at UBS O’Connor, and then back at Theorema. All the while, Paolo focused solely on the sectors that Tower House now specializes: healthcare, TMT, consumer and business services.
Prior to establishing Tower House, Paolo spent a few years as a managing director at C&C Group, a FTSE 250 consumer goods company, where he helped hone his “think like a business owner” philosophy through a better understanding of what really goes on behind the corporate façade.
Accomplished investors share their stories, mental models, and what market factors they’re paying attention to today. Host Andrea Gentilini of Novus unpacks what has helped them and hindered them on their diverse roads to success.