Values-based investing without compromise
At Archalos, we believe that good character, sound culture, and strong values are the foundation of a successful company and therefore are a strategic asset for investing. This means investors can invest in companies that support their values without conceding returns on that investment.
An innovative approach that goes beyond traditional methods
Most investors focus primarily on financial data, but at Archalos we understand picking a successful investment goes deeper. We’ve set out to identify those hard-to-see, intangible qualities of winning companies. We have developed a research-backed, innovative approach that measures those qualities by analyzing vast amounts of data.
Decades of experience identifying what makes a company succeed
With 50 years of combined investment experience, we’ve studied thousands of companies, managed capital across every market cycle, and seen what truly sets enduring businesses apart. Your hard-earned capital will be diligently invested by seasoned portfolio managers.
Internal labor markets and promotion from within
Training Spend as "Human Capital Capex"
Key Metric
0.66 Correlation
Correlation between Training & Performance
The Research
Accounting standards force companies to list "Training" as an expense, identical to "Janitorial Services." The data proves this is a classification error. The CIPD report cites meta-analyses showing that investments in Training and Development have some of the strongest correlations with organizational performance found in the literature (ranging from 0.60 to 0.66). Unlike physical Capex, Human Capital Capex improves the entire system. A trained workforce makes fewer errors and adapts faster. The return on this investment appears in the form of higher productivity per employee.
Data Source:
Key Finding
Strong positive correlation (up to 0.66) between training investment and firm performance.
The Archalos Thesis
We correct the GAAP error in our models. We move "Training" from OpEx to Capex. A company cutting training budget to make a quarterly number is, in our view, selling off its machinery to pay the rent. It works for one quarter, but it destroys the production capacity of the firm. We look for companies that maintain high training spend during downturns—this signals a management team that understands they are building an asset.
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