February 29, 2008
Move over, and put away your pens and billboards, Dan Loeb and Sardar Biglari! There’s a new activist hedge fund in town looking to take activism to a new forum: online.
Eric Jackson, founder of Naples, Fla.-based Ironfire Capital, this month launched the Ironfire Capital US Fund to invest in a concentrated portfolio of companies with low valuations growth potential.
Jackson, who last year launched campaign on video Web site YouTube to oust the leaderships of Yahoo! and Motorola, is betting on the Internet’s distribution capability to voice his concerns and criticisms about companies he deems as undervalued.
“Initially, we’re going to write letters and have private consultations with companies but if they rebuff our offers or suggestions, then you have to look at using online tools to make your views known to other shareholders,” said Jackson.
Jackson said his idea of using the Internet as an activist tool stemmed from the advent of political blogs, which have been effective in starting grassroots campaigns. Although he admits that the he won’t always be the biggest shareholder of a company—he owned only 96 shares of Yahoo, or a 0.00000007% stake—Jackson said it’s about putting out there the best ideas and waiting for support from other shareholders.
“What’s happening already, and will continue to happen, is we’re getting unsolicited suggestions from people about companies that warrant our attention. People feel like they can easily communicate with us whereas with most hedge funds, there’s a wall and the image that they portray is that they have all the smart ideas inside their firms and everyone else can stay away.”
The fund, which currently manages some $5 million in assets, is looking to raise $50 million by the end of the year. Investors who opt for a three lockup will be charged a 1% management fee and a 20% incentive fee and a 2% management fee for one-year lockups. The minimum investment requirement is $1 million.
Wednesday, March 05, 2008
February 29, 2008