Let's keep a snapshot of the wiki here now as it stands, in case that same IP address gets busy editing in the future..
Robert Luciano(born 1974) is an Australian fund manager, best known as the co-founder[1]of VGI Partners. Luciano's wealth in 2019 would have qualified him for theFinancial Review Rich List,[2]although his fortune has subsequently declined.[3]
Business career[edit]
Early Career[edit]
Luciano commenced his career as an accountant with BDO Nelson Parkhill in 1993.[4]He then started his investing career in 1996 at independent research firm Huntley’s. Luciano says the experience gave him valuable exposure to a wide range companies and recalls being handed a dozen investment books deemed required reading before starting as an analyst.[5]
Later, he entered the stockbroking industry at Prudential-Bache, and then Luciano broke into funds management after recommending that clients buy shares in the Australian Securities Exchange when it converted from a co-operative to a listed company. The contrarian recommendation gained the notice of Mark Nelson at Caledonia Investments, who subsequently hired Luciano.[6]
Luciano repeated the trick at Caledonia by buying into the Chicago Mercantile Exchange after it shifted from a co-operative to a listed company, which became one of Caledonia's best investments.[6]Luciano ultimately spent five years as an Executive Director and Investment Manager with Caledonia Investments in Sydney.
VGI Partners[edit]
After leaving Caledonia, Luciano co-founded (including with, among others, his sister-in-law Abbey Cook) VGI Partners in 2008.[7]At its peak in 2020, VGI had A$3.2 billion of Funds Under Management.[8]
VGI was best known for its short positions againstSlater & Gordon, jeweller Pandora,Hanesbrands, and Corporate Travel Management. VGI's aggressive short case against Slater & Gordon was an enormous success, which pushed the law firm's share price from A$8 to less than 30c.[6]
Luciano, who describes himself as being not good with people,[9]has a combative and direct management style. Luciano has several paranoid idiosyncrasies, including travelling with elite soldiers as bodyguards, installing a panic room in his office, and installing an airport-style swipe gate inside the door of VGI's premises. Luciano also ensures the Wi-Fi is turned off on the entire floor of any hotel room in which he stays.[10]
Luciano’s abrasive style extends to his relationships with professional advisers. He has fractured numerous adviser relationships over the course of his professional life, including with Jeremy “Gunslinger” Leibler of mid-tier boutique law firm Arnold Bloch Leibler.[11]
VGI Partners lost two-thirds of its investment team through the pandemic. According to one former employee, Luciano's team abandoned him because he can be difficult to work alongside.[12]
VGI's staff exodus included Douglas Tynan, a long-time lieutenant to Luciano, who resigned in 2020, and has since unveiled GCQ Funds Management. GCQ has opened up to client money in 2022, and has already lured a handful of VGI staff. Tynan was credited with picking long-term winners like Mastercard, WD-40, and Kikkoman at VGI, and building relationships with some of the country's sophisticated family offices and high-net-worth investors.[13]
Other senior departures include Robert Poiner, who joined VGI Partners in 2009 shortly after its launch, and became one of its top portfolio managers. Poiner left VGI in late-2021, and has since been raising money for his own firm, Edgeworth Capital.[14]
Luciano's personal fortune declined through this period. In October 2021 his 41 million share holding in VGI Partners had a value of A$206.9 million, A$523.9 million less than the $730.7 million it had been worth two years earlier when the share price reached a high.[15]
In November 2022, VGI's Chief Operating Officer Adam Philippe severed ties with the firm for a position with Roc Partners.[16]
In 2021, VGI's listed investment companies, VGI Partners Global Investments (VG1) and VGI Partners Asian Investments (VG8), came under pressure from activist investors for poor performance, and the mismatch between the share price and the value of the assets in its listed portfolios.[17]The activists suggested Luciano lacked appeal for retail investors, and that VG1's fees were too high.[18]Luciano has also attracted negative press attention[19]for his 2021 decision to prioritise the long-term risk of deflation over more immediate worries regarding inflation.[20]
Since inception in September 2017, VG1 has generated a net return of +0.3% per annum to November 2022, which compares to its previously stated investment objective to deliver average compound annual returns of +10% to +15% (after all fees and expenses) over a period of more than five years.[21]
VGI's recent foray into private investing has also been unsuccessful, after it wrote down a US$5m investment in Nicholas Moore-chaired Willow Technology Corporation by 69 per cent in 2022.[9]
This extended period of underperformance occurred despite Luciano claiming to have physical reminders in each VGI office of where the firm had come from and of the culture it wished to maintain. This included hanging the Harvard Business Review article "Why Winning Streaks End" on the wall of the Sydney analysts' room, with its clear message that "erosion begins by removing a process or discipline", while "rooting out complacency" is the job of the leader of any enterprise. In his inaugural letter to shareholders in the listed VGI Partners, Luciano also noted that "the Chernobyl nuclear plant disaster was said to be caused by engineers neglecting small portions of routine safety checks because they had done so before and nothing had happened."[22]
Merger of VGI Partners with Regal Funds Management[edit]
In 2022, VGI merged with Regal Funds Management to become Regal Partners. Early in the transaction process it was proposed that VGI shareholders would retain a 40% shareholding in the merged entity. This was reduced to 33.7% when the deal terms were finalised after a string of poor fund returns triggered outflows from the VGI funds.[23]Media reports suggested that Luciano's remuneration demands were a contentious item during deal negotiations, as he requested an increase in remuneration from A$450,000 per annum to a 5-year deal worth A$25 million.[24]
Regal Chief Investment Officer Philip King said the merger would allow Luciano focus on investing, without the distraction of day-to-day operational matters.[25]
While the merger was described as a ‘shotgun marriage’,[26]Luciano said Regal Partners would benefit from the experience that both he and King brought. In January 2022, Luciano said, "Certainly since I started VGI, I haven't had anybody who is my peer working with me. Spending time with Phil, it's given me a perspective of how valuable it can be of having someone at the same level and capability set."[27]
According to activist investor David Kingston, the merger marked the death of the listed VGI controlled by Rob Luciano when it merged with Regal.[9]
Following VGI's merger with Regal Funds Management, VGI's unlisted funds under management declined by as much as 55% between June 2021 to March 2022.[16]
In June 2022, Luciano was subsequently replaced as Portfolio Manager of VG8 by King.[9]In November 2022, VGI Partners Asian Investments changed its name to Regal Asian Investments, which reflected recent changes in investment management responsibilities.[28]
"Sabbatical" from Regal Partners[edit]
On 8 June 2023, Regal Partners announced that Luciano would be taking a three month “sabbatical” break from his duties with the firm. It is not clear whether Luciano’s performance as a pure investor, without the distraction of day-to-day operational matters, is correlated with this announcement.[29]
Press reports around the decision to take a “sabbatical” stated that it was unclear whether Luciano will return to Regal after his break. These reports noted that other fund managers had long expected Luciano to “step away” permanently after the Regal deal completed.[30]
Luciano's own comments on a public webinar held to coincide with the announcement of his “sabbatical” were consistent with the media speculation that he may not return. Luciano did not directly address whether he would return, instead saying that "the last couple of years have been pretty difficult for me personally and it is something which does take a toll on you. So I have been pleased that I have been able to manage the portfolios and transition the group into Regal Partners and that hopefully is a great outcome for our investors, a great outcome for our staff and a great outcome for shareholders. So I feel that now is the right time for me to be able to take a break and spend time with family. I am looking forward to seeing how the group evolves going forward under the stewardship of yourself [Brendan O'Connor], Phil and the broader team."[31]
Airbrushing history[edit]
In July 2023, an anonymous Wikipedia editor operating from an IP address publicly traceable to VGI Partners edited this article, removing large parts of the Luciano life story. This included references to his abrasive management style and somewhat paranoid foibles, like installing a panic room in his office and travelling with bodyguards. Also removed was a reference to a 2021 article about alleged tree vandalism to large eucalypts outside Luciano’s Mosman mansion. Other edits included elimination of discussion of Luciano's $5 million investment in his brother-in-law Jonathan Cook’s micro-cap business and some criticism from activist investors over his returns. Even a reference that his VGI Partners was apparently co-founded by his sister-in-law Abbey Cook was removed. Following edits being made over several evenings, the changes were reversed by an industrious Wikipedia moderator.[32]
Personal life[edit]
Luciano's father, a professional hotel piano player, moved to Australia with his family before Luciano was born. Luciano's mother was a school teacher.[6]
Luciano lives in Sydney, and owns homes inMosmanandPalm Beach.[3]
Luciano is married to Samantha Luciano (née Cook).[33]
In November 2022, Luciano was called out for investing A$5m of VG8 shareholders' capital in brother-in-law Jonathon Cook's micro-cap business, SenSen Networks, despite the fund's prospectus clearly nominating a preference for large and liquid companies. At the time, Jonathon Cook was SenSen's Chief Financial Officer, and Luciano got the tip during Christmas 2020, when Luciano is said to have joined with him and others for the traditional family lunch.[34]
Philanthropy[edit]
In 2018, VGI established a philanthropic arm, the VGI Partners Foundation.[2]Luciano has supported the Wanderers Education Program, which funds tertiary education for members of the Special Air Service Regiment. The VGI Partners Foundation also supported the Sydney Children's Hospital and the Sydney Jewish Museum.[35]
A further philanthropic activity undertaken by VGI has involved the management of funds on a pro bono basis for charities.[36]A part of this philanthropic activity saw VGI partner with Future Generation Global (FGG) when FGG was listed on the ASX in September 2015. This relationship subsequently fractured, with FGG disclosing in August 2022 that it had redeemed the $42 million it had invested with VGI Partners.[37]FGG has said that it tends to remove a manager if there's consistent underperformance over a very long extended period of time, or if for instance there might be key personnel that might leave.[37]
Community Involvement[edit]
Luciano has been actively involved in the interface between the community and local government in both Mosman and the Northern Beaches.
In January 2019 Luciano wrote a widely-circulated letter to the mayor of the Northern Beaches, Michael Regan urging an immediate cleanup of Palm Beach following the appearance at the beach of murky puddles and malodorous seaweed, accompanied by signs warning of a "sewage overflow".[38]
In May 2021 trees in Mosman were vandalised in a move that enhanced views of Middle Harbour from Luciano's double block. Large eucalypt trees outside Luciano's boundary were largely stripped of their foliage, with the Mosman Council responding by erecting two black banners noting that: “Tree vandalism has occurred in this area”, and threatening fines of up to $5m.
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