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Project $1M: Here Comes The Correction

Jun. 04, 2019 9:18 AM ETADBE, BABA, BIDU, BKNG, CRM, TCOM, MELI, NOW, PMCUF, WDAY22 Comments


  • Project $1M felt the impact of the beginning of the correction in equity prices that occured in May.
  • The portfolio declined almost 3% after successive increases in the last few months.
  • Chinese holdings in the portfolio, including Baidu and Alibaba, were hit particularly hard.
  • I made the decision to swap out Booking Holdings and add Salesforce.com.

In my April update, I commented that it appeared that things were too complacent in the markets, with equity values rising too fast too soon, and that I was expecting there to be a noticeable dip, as much as 14% in Project $1M portfolio value by the end of 2019. While May didn't see this prediction come through, it did bring the start of what I expect to be a more sustained downturn over the next few months. Funnily enough, I didn't anticipate that the trigger for the downturn comes in the form of the on again, and now off again tariff deal. In any case, I view this latest pullback as very healthy, and while not enough to get me to increase my market exposure, something which I have been planning and preparing for.

My broader investment focus with Project $1M is the purchase and long-term hold of a clutch of high-growth, cash-generating businesses that are powered by secular tailwinds. The advantage of these secular tailwinds should be to allow the selected businesses to grow under any economic conditions that may be experienced over the life of the Project $1M portfolio (a decade or more).

Markets may move the prices of Project $1M businesses around, here and there, depending on sentiment. However, I am focused on the long-term returns on invested capital that my businesses can generate and the opportunity to deploy that invested capital at high rates of return over a long term horizon. For those that are new to the Project, here are Part 1, Part 2, and Part 3 of the initial investments in the portfolio.

The overall objective of the portfolio is to turn an initial capital base of $275,000 that was initially deployed in November 2015 into $1,000,000 by November 2025. This will be done primarily through

This article was written by

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Strategies designed to unearth long-term, wealth creating machines.

I am an investor who is focused on disruptive businesses that are transforming industries lead by visionary leaders with substantial skin in the game. I have spent nearly 20 years in a formal capacity in various investment banking and corporate advisory roles, having attained my MBA with a concentration in finance. This led me toward a path in Venture Capital and working with entrepreneurs building new technology businesses, and I have had the opportunity to not only invest in a number of amazing privately held businesses, but also play a meaningful role in growing several of these early stage enterprises as well. I am now focused on applying my lens of private market disruption and leveraging secular tail winds to the public markets. This was a journey which I started with my public Project $1M portfolio series and which I have deepened with my marketplace service, Sustainable Growth

Analyst’s Disclosure: I am/we are long ALL POSITIONS IN THE TABLE. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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