The Horton Fund

The Horton Fund acquires influential positions in small and micro-capitalization public companies where long term value can be enhanced through collaborative activism.

Management

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Joseph Manko

Sr. Principal

Mr. Manko has over 20 years of investment experience, predominately in the asset management, private equity and public capital markets. Prior to founding The Horton Fund, Mr. Manko was a Partner and Chief Executive Officer of Switzerland-based BZ Fund Management Limited, a Swiss private bank with approximately $5 billion of AUM.

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David Achey

Principal

Mr. Achey has over 10 years of investment experience, partnering with emerging growth companies as both a trusted advisor and investor. Prior to joining The Horton Fund he served as a Director of Investment Banking at Mufson Howe Hunter & Company LLC.

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Michael Howe

Senior Advisor

Mr. Howe has over 30 years of buy-side and sell-side experience, predominantly in the trading, research, investment banking and investment management segments.

Investment Process & Strategy

The Horton Fund acquires influential positions in small and micro-capitalization public companies where long term value can be enhanced through collaborative activism. The Fund seeks to generate market superior performance by identifying value creation opportunities and working with the company to accelerate growth and ultimately shareholder returns.

Highlights:

  • Private Equity style investing in Public Equities

  • Liquidity of a Hedge Fund and tax efficiency of Private Equity

  • Focus on identifying and creating the catalyst for growth

  • Average 3-5 year hold

  • Long-only

  • No leverage

  • Market capitalization ranging from $15 to $250 million, limited by Fund AUM

  • Targeting 6-12 positions

  • Industry Selective

    • Industrials

    • Healthcare

    • Infrastructure

    • Tech Services

Horton’s proprietary stock selection process is based on intensive fundamental, “private equity style” due diligence sifted through the Principals’ extensive industry experience and operating partner network. The Fund’s oversight and influence aims to accelerate and optimize alpha generation over the long term, while emphasizing good governance and responsible management.

The Horton Fund’s strategy is driven by fundamental analysis of small and micro-capitalization public companies with strong management teams, quality products/services, solid prospects and high profitability potential; yet are undervalued and under-appreciated by the investment community. As a result, the stocks of these companies are often characterized by low trading volumes, discounted valuations relative to larger peers and indifference from the institutional investment community. Many of these companies have limited access to much of the benefits of being publicly traded.

To enhance shareholder value, The Horton Fund seeks to assist these businesses and provide the resources (i.e., both the capital and guidance) needed to execute the actions that enhance value. Prior to fully investing, Horton typically will have identified the likely value realization events for each position and preliminarily tested feasibility.

At A Glance

Total AUM$40mm

InceptionMar 20, 2013

Fees (Mgmt. / Perf.)2% / 20%

Investment VehiclesOnshore

Additions / RedemptionsMonthly / Quarterly

LockupYes

High Water MarkYes

Minimum Investment$250,000

Strategy Offered Through Private Fund
Managed Accounts

Sponsored Partner Horton Capital Partners, LLC.

The Collaborative Activist Approach to Investing

We believe Horton is uniquely qualified to execute this strategy, which requires a diverse set of experience and skills, a deep operating partner network, and the patience and conviction to utilize the volatility of the public markets over a long-term investment horizon.

  • Capital Markets Experience

  • Private Equity Diligence

  • Fundamental Equity Research

  • Mergers & Acquisitions Experience

  • Corporate Finance & Operations Experience

  • In-Depth Corporate & Securities Law Knowledge

This experience has enabled The Horton Fund to develop what we believe to be a unique screening process to identify undervalued stocks (i.e., where there is a gap between price and underlying value) and evaluate the potential for collaborative activism to eliminate the gap. Horton’s network gives it a competitive advantage to fully develop and execute on the optimal path to maximizing value. While most of the time Horton works in direct alignment with management, there are instances when influence is needed to ensure the optimal result is achieved. The balance of supporting management in its efforts while striving to make sure the company remains on track is the essence of collaborative activism. The commonality amongst investments is that Horton strives to be in a position of influence, and often the largest independent shareholder.

Representative Activities

  • Advised Target in evaluating acquisition opportunities, ultimately resulting in significantly accretive transaction

  • Added experienced operating partner to Board of Target in need to strategic guidance

  • Joined Board of Target during management transition, and currently managing CEO search process

  • Advised Target in structuring up-list to Nasdaq and capital raise, significantly improving liquidity and institutional ownership

  • Initiated public campaign urging Target to replace Board members, improving management accountability and reinvigorating company