CHRIS HARBORNE: WHERE
UNICORNS ARE FOUND
Interview by Jonathan Bastable
‘Maybe half a dozen times in the past 20 years I have made bold decisions against the flow of conventional thinking,’ says entrepreneur and investor Chris Harborne. ‘Being contrary in a crisis is the opportunity. Success often comes if there is a willingness to continue along a particular path when everyone else is too scared to go on.’
This sounds like fighting talk, or it would do coming from someone with a less relaxed and thoughtful manner. Harborne thinks long and hard before answering any question. He seems almost surprised by his own insights, and by the direction that his career has taken. ‘Until I decided to go it alone I had the bluest of blue-chip résumés,’ he says. ‘I can operate in the world of dinner parties with finance ministers, but I am not part of that establishment, and this is deliberate. I absolutely do not want to follow the crowd.’
Just to stay standing when everyone else falls away is to win, because you only fail when you give up.
Harborne’s investment strategy is, he says, deliberately unconventional. ‘Many investors have 30 or 50 stocks in their portfolio. For me, that is too broad: I stick to between three and five at any one time. Three is enough to give you diversity: if one hits a roadblock, you have two others that you can go and work on. I can go intensely deep with a few ideas – too many, and it doesn’t work. Nor does too few. I learned early on that if you depend on one or two projects then you tend to fixate, which becomes self-destructive.’ It is also key to Harborne’s strategy that there is no apparent overlap between concurrent projects. He says that he aims for investment themes that are ‘uncorrelated’, and adds that this is one of the hardest tricks to pull off in business. Part of his rationale is to quarantine investments from each other – if one fails the others are unaffected – but more importantly, spreading his interests across various industries and technologies allows him a broader field of vision: his strategy means that he is more likely than his competitors to spot the rare unicorns of opportunity in the thickly forested investment landscape.
In quite a short time – between ten and thirty years – the sum of virtual tokens will be worth more than all the currencies, all the stockmarkets, all the tradeable assets in the world today.
That is not to say that Harborne’s investments have nothing in common. He has a knack for scoping out situations that are ripe for change – either through his intervention, or because deep forces are at work. This is certainly the case with his present portfolio. His main preoccupation is with Ethereum, the open software platform based on blockchain technology on which developers are creating world-changing decentralised applications, or Dapps. Ethereum’s tradeable virtual currency application – Ether - is fast catching up with Bitcoin in its mainstream adoption. He has been following the rise of digital money for five years and says that ‘the coming change is as fundamental as the invention of paper money in the 18th century. In quite a short time – between 10 and 30 years – the sum of virtual tokens will be worth more than all the currencies, all the stock markets, all the tradeable assets in the world today.’ Harborne’s second project concerns jet fuel, or rather the Byzantine network of trading relationships between fuel producers, resellers, airlines and the travel industry. His company AML functions as an agency, a new kind of institution in this marketplace. By taking on the financial risk and managing the flow of money, Harborne’s model allows for much more efficient and cost-effective transactions.
Thirdly, and more speculatively, Harborne is involved in a long-term project to develop seabed mining. ‘I’ve been working at it for ten years,’ he says. ‘It is essential for the sustainability of human society that we mine minerals much more efficiently. All the minerals we could ever need are there on the seabed. You might have 10 billion dollars worth of gold or copper or zinc on an area about the size of a couple of football pitches. People imagine that mining the seabed is bad for the environment, but it is actually hugely positive. If we can get down there and bring what we need to the surface, that will have so much less impact on the environment than slicing away the side of a mountain, as we do now.’
Harborne says that deep-sea mining, like the currency revolution, will happen surprisingly soon – so long as the right people keep working on it and investing in it. ‘Persistence, continued persistence, often means that you win,’ he says. ‘Just to stay standing when everyone else falls away is to win, because you fail only when you give up.’
AML Global fuelled Air Force One for the US President's visit to Thailand in 2012 © Alex Wong
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