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A revolutionary idea

The foggy streets of London could be seen from the glass-walled offices of the investment bank. Here, the hallmarks of the British Empire’s glory days were far removed. This was now the financial epicenter of the world.

There was an air of distinction to the place, but Hannes Kulvik was not happy with what he heard.

At the beginning of the 1990s Kulvik had, with the help of his career and business acumen, amassed a great deal of wealth.

The largest banks in the world were eager to meet him, and so Kulvik visited the best investment banks that New York and London had to offer, but the result would always be the same:

Their asset managers would speak of how companies are affected by news cycles, and then about their business predictions and tactical allocation plans.

Their ideas were far too speculative and opportunistic for Kulvik’s tastes.

These bankers seemed to treat stocks like race horses, something to bet for or against.

Kulvik did not dare entrust his money to their hands.

Kulvik was interested in exemplary companies that he could hold on to for longer periods of time. Since these investment banks were of no use, Kulvik realized that he would need to come up with his own methods for finding the right companies to invest in.

As an engineer with a PhD degree, Hannes Kulvik’s goal was to develop a systematic model that would stand the test of time and generate profits even during the toughest economic cycles.

Hannes wanted to find the companies with the best revenue models

He sat in front of his Bloomberg terminal and scrolled though the endless rows of data that were available to him. The world was filled with publicly traded companies.

How on earth could be find the ones with the best revenue models?

Despite the glut of options available to him, Kulvik remained undeterred. He realized that he needed to turn the tables.

What if he stopped looking for the best companies among the tens of thousands of alternatives available to him and instead focused on eliminating the ones that he would surely never invest in?

This is how Stocksifter – a tool that helps speed up the process of discovering the best revenue models – was born.

It was only a large Excel table at first, used to process real-time Bloomberg data. However, its operating model and criteria were practically the same as they are now, almost twenty years later.

By using quality-oriented criteria to find the best businesses, Stocksifter could ignore the companies whose business models did not meet its demands, and then rank those that did.

When he discussed his dilemma with his closest friends and acquaintances, Kulvik noticed that he was not alone.

There was clear demand for a service that could apply an engineering mindset to investigate and discover the businesses that were worthy of investment in the long term.

Fund was established in Luxembourg in 2003

In 2003, the Sifter Fund was established in Luxembourg, and the fund’s portfolio was managed from Kulvik’s home city of Geneva in Switzerland. In 2015, the portfolio’s analysis work was transferred to Finland under Sifter Capital Ltd.

The fund’s mechanical screening process and careful stock analysis methods soon attracted investors from Finland, Switzerland, France and the United Kingdom.

The original idea – to invest only in the best revenue models when they are available at a fair price – remains the same.

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Download Investor Manual