For corporate boards across every industry, there is no denying the influence of the opinions and collective power of their highly leveraged shareholders, many of whom won’t hesitate to pressure them to increase profits – publicly, if necessary. This surge in investor activism is reshaping the way businesses operate globally, with boardrooms proactively enhancing efficiency and boosting executive accountability to ward off potential activist campaigns.
Last year alone, 27 CEOs were ousted due to investor activism, driven by players ranging from seasoned Wall Street bankers to sector-specific hedge funds. These investors, focused on unlocking shareholder value and improving financial performance, either rehabilitate companies through strategic assessments or, if unsuccessful, pursue high-value mergers or sales.
Texas companies are no strangers to activist investing. In a state with business-friendly laws that attract virtually every industry, there is fertile ground for entrepreneurial ideas from shareholders.
Anson Funds, headquartered in Dallas, is a multi-strategy hedge fund with nearly $2 billion in assets under management (AUM). Founded in 2003 by Chief Investment Officer Moez Kassam, Anson employs a variety of strategies, including activism, tactical long/short investments, structured financings, and arbitrage. The firm has garnered recognition from Barron’s, Bloomberg, and HedgeWeek as a top-performing investment manager.
Anson’s activism strategy gained momentum with the appointment of Sagar Gupta as portfolio manager in 2023. Gupta was previously with Legion Partners, where he played a key role in activist campaigns in the technology, media, and telecommunications (TMT) sectors. Sagar also served on the board of Momentive Global (MNTV), the maker of SurveyMonkey.
Since joining Anson, Gupta has secured a board appointment with a TMT company and removed a CEO and founder of another, thus quickly re-rating its stock. Anson Funds has publicly pushed for strategic changes within other high-profile companies in technology and entertainment.
In today’s fast-paced, globally connected business landscape, established firms like Anson Funds inject fresh perspectives, breaking through insular thinking and long-standing traditions, especially from a shareholder’s standpoint. There are arguments to be made for increasing efficiency in business wherever possible. But the manner of doing so separates successful firms like Anson Funds from those with no long-term strategy.
Gupta attributes much of his success to his sector-specific expertise and deep network of executives, equity firms, legal experts, and top talent—a combination that is crucial for orchestrating successful deals. Generalist firms without these advantages often struggle to replicate such consistency. Kassam and his team emphasize long-term engagement strategies, particularly with small and mid-cap companies. Gupta envisions collaborations across sectors within the firm, including real estate and healthcare, capitalizing on the team’s collective expertise. For companies working with activist investors, seeing successful outcomes in their industry instills confidence.
As information becomes increasingly accessible and AI-driven assessment tools enhance the ability to unlock value, the influence of activist investors will continue to grow, driving significant changes in the future of business.
