Pie Funds Financial Review Feature: Meet Mike Taylor, New Zealand’s Humble Pie Investor

22nd February 2016, The Australian Financial Review by Jonathan Shapiro

In 2008, upstart Kiwi investor Mike Taylor was selling his furniture to pay his living expenses, as the $3 million of his friends’ and family money he was managing was battered by the brutality of the global financial crisis. Today, after surviving and prospering, his fund is 100 times larger.

Now he’s buying furniture. But Mike Taylor is also prepared to face another bear market head on.

“We are in that environment where I’ve told my analysts, there’s no holds any more – if you don’t want to buy it, sell it,” Taylor, the founder of Auckland-based Pie Funds Management, tells The Australian Financial Review.

Pie now manages around $300 million in several funds that invest in small-cap stocks in Australasia and around the world, employing a team of 16.

At the time we caught up with Taylor, he’d moved the funds to cash positions of 40 to 43 per cent. That’s about the mid-point of his highest ever cash position of 80 per cent and the lowest of 2 per cent.

“We’ve always had a lot of cash. I like cash,” he says. “It’s a way of proving to people we can meet redemptions. When there are opportunities around we want to have cash and when the market is down we don’t feel so bad. It’s the ‘sleep at night’ test which is important,” he says.

Taylor’s quest to become a star fund manager is a tale of perseverance. He began investing when he was 17, taking out a $3000 interest free loan that was available to students from ANZ and another $10,000 from his parents. He turned that into $200,000 by investing “probably in a bunch of rubbish” including some cheap options in mining stocks that soared in value.

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