8I Holdings Limited (ASX:8IH)

[Bosco]

I was in the inner circle of the company. Took part in some of the spin off IPOs that they offered; Digimatic, Velocity. Both did not do well and I decide to cut my losses. Was there any financial engineering involved remains a question. I didn’t do much due diligence because I was sold by the sales pitch.

Koon Boon, being the CIO, is a prominent figure. I’ve always enjoyed his way of presentation. To see that his name has been removed from their website definitely raises an eyebrow. Given that the Hidden Champion Fund was his brain child, I suspect something has happened. There’re also some analysts whose name I don’t see around anymore as well.

[shadow_walker]

Hidden Champion Fund has underperformed badly in 2017 and 2018.

In 2017, it was up 11.7% although MSCI Asia ex Jap did 41.7%. YTD, it was down 16.6% although MSCI was probably flat.

https://hiddenchampionsfund.com/wp-conte..._Apr18.pdf
https://www.msci.com/documents/10199/275...83094e0d65

Koon Boon has left to set up a new fund called H.E.R.O Innovators Tech Fund, showing a backtested model portfolio return of 430% in the past 5 years... Another guy trying to catch the tech rally of last year.

http://www.heroinnovator.com/wp-content/...y-2018.pdf
http://www.heroinnovator.com/

My issue with his funds are that the fees are too high. Much higher than the mutual funds which has to support a retail distribution channel.

[Ray168]

A large part of 8I's assets is an investment in their own Hidden Champions Fund. I was following this value investing fund with interest as the writings of the CEO/CIO Koon Boon Kee were interesting and made sense to me. Also, the fund was doing well. I was considering buying the 8I stock at some point as an indirect way to enter this fund at a discount. (btw I am not advertising this without doing further research first: it may be a gamble when the other activities of 8I lose so much money that creditors could lay claim to the fund's proceeds.).  

However... I just checked and noticed Kee's last writing was of february 2018. Also, his name is removed from the 8I Holding's website, while the other Fund employees are still listed. Did 8I and Kee parted ways after only 2 years?

Financial Update 17 Apr 2018

It has identified that the net loss for FY2018 is expected to be in the range of S$4M to S$5M (Fy2017: net profit $S11.5M), on the expected revenue and investment income of approximately S$20M to S$22M (FY2017: S$28.9M)



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[Ray168]

I was in the inner circle of the company. Took part in some of the spin off IPOs that they offered; Digimatic, Velocity. Both did not do well and I decide to cut my losses. Was there any financial engineering involved remains a question. I didn’t do much due diligence because I was sold by the sales pitch.

Koon Boon, being the CIO, is a prominent figure. I’ve always enjoyed his way of presentation. To see that his name has been removed from their website definitely raises an eyebrow. Given that the Hidden Champion Fund was his brain child, I suspect something has happened. There’re also some analysts whose name I don’t see around anymore as well.

Koon Boon picture still there …. in a group picture with the 2 directors. 

[mslee888]

Kee Koon Boon is still CIO of hidden champion fund.

https://hiddenchampionsfund.com/team/

[jaco]

All thanks for updating me !

In the H.E.R.O Innovators Tech Fund presentation slide, it is noted that KB Kee was CIO of the Hidden Champions Fund from Sept 2015 till Dec 2017. So, I conclude that he has left 8I Holdings, but not all web pages have been updated accordingly yet.

I had not yet seen the april update of the Hidden Champions Fund and therefor I did not realize that this fund has done horribly YTD 2018. Technically, KB Kee is not responsible for this, but these are mostly his earlier share picks collapsing and it seems unlikely he would have been able to stop that, would he still be around. This timeline also suggests that the bad performance of Hidden Champions can not be the reason for KB Kee's departure.

I believe Kee is able to identify good companies in terms of high quality management, good fundamentals and good prospects. But he is perhaps not a great stock picker. I kept track of his publicly presented picks and always found them to be highly or even very highly priced from a value investing perspective. Hence, most of his suggestions are on my watchlists and may become useful after a general market crash.

[Bosco]

If Koon Boon has really left 8IH, I can only wonder why wasn’t the shareholders notified on the departure of such an important figure, and if those who subscribed to the HCF even knew about it.

[Ray168]

If Koon Boon has really left 8IH, I can only wonder why wasn’t the shareholders notified on the departure of such an important figure, and if those who subscribed to the HCF even knew about it.

Since you're their inner circle member, you could just call or write to them for clarification.

Key management moment is not require to announce officially.

[jaco]

It seems there has been a notification after all, albeit a concealed one. On 27 march 2018, there was a 8I investor presentation with one slide concerning the Hidden Champions Fund. The text is as follows:

Hidden Champions Fund
Enhancement of Investment Process

Piloting “multiple-counsellor” system of investment management
Advantages
– Reduce key man risk
– Manage concentration risk
– Increase accountability for the portfolio managers

Growth Strategy
Target to grow AUM through the below channels :

- In-house fund raising roadshows
- Increase distribution channels
- Speaking engagements to build up the brand

It looks like KB Kee's departure exposed a key man risk issue and that the fund is, or will be, managed by "multiple counsellors".

I did not attend this presentation, but we may assume that Kee's departure was revealed in words during this presentation. IMHO such an important fact should also be announced more clearly to the public at large, but I am not sure whether this is a requirement in Australia. We should also acknowledge that such an announcement could do harm to the fund, especially when there is not yet a new fundmanager.

[Bosco]

If Koon Boon has really left 8IH, I can only wonder why wasn’t the shareholders notified on the departure of such an important figure, and if those who subscribed to the HCF even knew about it.

Since you're their inner circle member, you could just call or write to them for clarification.

Key management moment is not require to announce officially.

I’m no longer part of that. Paid a few thousand to be their inner circle, lost that, and then lost more money through the IPO subscriptions. Yeah could be they’re not required to disclose, thus they just keep it hush. A few of their previous key analyst “disappear” in similar fashion too. Someone’s got all the infinity stones for sure.