From respected financial journalist to renowned investor, Malcolm Burne believes his life and career has been blessed with good luck. However, as his diverse portfolio proves, it’s more of a case of fortune favouring the bold.
Veteran investor Malcolm Burne has a storied history of being in the right place at the right time.
Case in point... In Australia, in the early 1980s, Burne was invited to be a seed backer for the film Crocodile Dundee. His $50,000 investment returned a healthy $2 million after the movie became one of the biggest box office hits of the decade. “Unlike most films that cap investors profits at 20 per cent, l was attracted to the profits-with-no-cap-in-perpetuity clause,” he says. “Years later, l was still getting cheques for video rights in places like the Philippines and El Salvador.”
From a successful start as an equities broker and financial journalist to a fruitful career as a securities market entrepreneur, you could say that luck has always been a lady for Burne.
“I have actually been 60 years in the City. And I’m now literally three minutes away from where I started,” he says of a career that has seen him traversing the globe.
“When I was young, I asked my grandfather, who was a chartered accountant, to explain certain shares of his to me – they were Burmah Oil and [mining operation] Rio Tinto Zinc – and that led to my interest in commodities.
“I was always good at maths at school – not so great at English, that came later – so I started as an equities analyst at a leading firm of City stockbrokers,” he says. “In those days, I used to visit industry leaders all over the country and write broker reports on various sectors. I was very fortunate that some of my work got noticed and The Financial Times phoned me to offer a job.”
That led to an eight-year career in financial journalism, where Burne was responsible for writing investments and savings columns in The FT, The Telegraph and The Guardian. His subsequent advice and own shrewd investments resulted in an unexpected career shift.
“A lot of The Telegraph’s readers wrote in asking if I could manage their money for them.”
“I was able to enjoy a huge bull market while recommending shares during the early 1970s,” he says. “My performance was so good that a lot of The Telegraph’s readers wrote in asking if I could manage their money for them. It was such a large postbag that I thought, ‘I can't ignore this’. So I set up an investment management firm to manage other people's money. And the paper gave me a nice plug when I left!”
The financial crash of 1972 saw Burne scrambling out the business after a short time and merged with another investment company before making a return to journalism, this time as financial editor for International Management, a prestigious US publication by McGraw Hill. He admits it was not an elegant exit.
“This led to me travelling much of the world for the magazine and eventually moving to Australia, where I was very lucky again because I arrived at a time when they didn't have much of a financial services industry, venture capital or corporate finance,” says Burne. “So, I was able to take advantage of my City knowledge in starting managed funds, venture capital, corporate finance and mergers and acquisitions. Before Australia, I was living and working in Hong Kong for a large family office and was able to accumulate capital.
“Over a period of a few years, I successfully built up several investment and industrial companies. Then there was another massive crash in 1987, so I went back to Hong Kong to do further venture capital work, only this time as a principle owner.”
Never one to let the grass grown beneath his feet, Burne, having “Gained quite a lot of knowledge in Australia about the natural resource industry”, moved to Canada during a diamond and gold boom – “I got stuck in and did quite well there,” he says.
In the early 1990s, Burne returned to London to start a mining investment company Golden Prospect. “That morphed into Ambrian Capital, which became the largest natural resource brokerage in London at the time. I managed to sell my stake in that just before the crash of 2008,” he says of his by-now typical financial prescience.
“Before I sold Ambrian Capital, I took out the gold equities portfolio in 2006 and put it into a new investment company called Golden Prospect Precious Metals, which is listed today and of which I'm still founder chairman all these years later.
“I then went into the tech market. I got lucky because my son, who lives in Silicon Valley, discovered an opportunity to buy private company shares in these big iconic unicorns like Spotify and Uber and Airbnb. So, I started a fund [Star Tech NG] to invest in these pre-IPO tech companies and that did very well.
“I thought, ‘Well, why don't we have a secondary market like this in the UK whereby sellers and buyers can match?’ When the chance to buy 50% of JP Jenkins, the UK’s oldest-established private share-trading platform, came up I used that nucleus to build on that secondary market aspiration.”
“I’m a huge consumer of information - that really improves the odds when investing.”
To hear Burne recount his career, he’s seemingly keen to emphasise his good fortune when it comes to quality investments and weathering financial storms. But that would do a disservice to this savvy decision maker who, through commitment and diligence, has finely tuned his golden touch over the decades.
“I believe in having good fortune, the timing was always good,” he says. “The reason for that, I think, is because I’m a huge consumer of information - that really improves the odds when investing. I tell the younger ones read, read, read as much as you possibly can.
“I think you make your own luck sometimes too. The harder I worked, the luckier I got. And of the setbacks I’ve had in life, I would never blame these on bad luck.
Burne’s voracious appetite for learning and decades-long experience in mining and commodities has resulted in what he believes is a now cast-iron portfolio.
“I've always been a gold bug,” he says. “I believe that gold is the only safe haven in times of crisis. I learned a lot owning Australian Bullion Company in the 1980s.
“Because I read a lot, I do sometimes see what's coming. I'm very involved in the commodities space and I saw the supply constraints that COVID would bring. And because I saw the ESG impact on the mining industry, I knew to invest in different battery metal resources like copper, nickel, lithium, and cobalt. It's also quite clear that the world's going to go to cleaner fuel, so uranium was obviously going to have some kind of recovery. Also, rare earth minerals and critical metals. You can buy shares in all these sectors!”
For Burne, the benefits of commodity investment are clear, but he’s still surprised that seemingly few ultra-high net worth families look to include commodities in their portfolios. “[At a recent event], I asked people what their asset allocation was,” he says. “Predictably 50% was in real estate and another 20% in bonds. No hands went up when I asked how many family offices have an interest in commodities or gold.
“I think my experience of precious metals and the relative success I've had in this sector has made me braver. To understand gold shares, you’ve also got to understand mining. And if you understand mining, you can adapt your knowledge of precious metals to other areas, particularly nickel, copper, and lithium. Those metals come out of the ground the same way gold does.”
“Gold has proved to be a safe haven for years and it’s the best insurance policy against what's going on now in the world.”
While he believes that mining will always be a vital industry – “There's a continued exploration process, the world must have resources” – he does believe that ESG priorities will force the trade into more sustainable practices.
“The green energy evolution is necessary, whether you want to invest in it or not,” he says. “Personally, I have invested in battery metal stocks, like lithium, cobalt and others to service the electric car evolution and net zero exchange-traded funds (ETFs).
“But I suppose my main love has always been buying shares in precious metals. I understand why gold and silver is attractive. It has no counterparty risk. It has proved to be a safe haven for years and it’s the best insurance policy against what's going on now in the world.
“As far as the future is concerned, well, it hasn't changed. Gold has always been an insurance policy in bad times, as a hedge against inflation and geopolitics. There's no abundance of it anymore and, because of the ESG issues, they can't do what they used to do and blitz the land. The World Gold Council is continually educating investors that it’s still a very worthwhile asset for protection and diversification.”
A father to two sons (one a digital marketing specialist, the other a Silicon Valley entrepreneur) and a daughter (who wrote for The Wall Street Journal for ten years before becoming editor at BNY Mellon financial magazine Burne has a clear eye on legacy, if not succession.
“I'd love them all to join me,” he says of his single family office. “I could just plug them in, I’d know exactly how to use them. But they’re just not interested. It's not a family business really and two of them live in the United States.
“When COVID hit, it made us seniors all look at our mortality. Now I’m keen that I don't leave a legacy mess,” he continues. “My affairs could still be regarded as too diverse, so I've recently sold my wine collection, my stamp collection, my golf debenture and other alternatives. I think it’s important that my family can see the wood for the trees.”
A thoughtful, diligent and, yes, occasionally lucky investor, even at this point in his career, Burne’s investment approach remains typically lively… “Live in the now and stay in the flow. Don't do too much planning. And when something hasn't worked out, get rid of it, consign it to the past and move on.”