Home > Antoine Argouges on why he founded Tulipshare, the activist investment platform

I’ve dealt for a few activist investment funds as a broker over the years. The ones I’d deal for would accumulate large positions in companies through various different desks around The City, then give them up to us as their prime broker. They’d do this for two reasons, one, to keep their buying spread out so the order flow was not too obvious. And secondly, to keep under the regulatory reporting radar, so they wouldn’t have to notify the stock exchanges when they crossed a certain ownership percentage.

They’d mainly do this so they could either break up the company, get rid of management or change a company’s direction. All in the name of shareholder value. They are direct, serious and passionate about what they want to achieve.

But now there is a new type of activist investment fund, one that aims to make changes for good, not just for profit.

In our latest CEO interview, we talk to Antoine Argouges, the founder of Tulipshare (who came across as just as direct and serious, but more passionate) about why he set up the business and how his activist investing platform can make meaningful change for good.

What is Tuplishare?

Tulipshare is the only activist investment broker-dealer in the UK and in the world. It’s the only broker-dealer that puts corporate governance at its core through shareholder activity. We attract a community of like-minded investors. So, every stock that is listed on the platform is attached to an activism campaign. You buy Coca-Cola to ban plastic. You buy Amazon to improve working conditions. You buy Johnson & Johnson to remove cancer-causing products. It’s a very, very easy, direct line between your share ownership and the engagement that we are doing with the company. So, that is Tulipshare in essence.

How do you go about becoming or making people activist investors?

Just like any other broker, people pick and choose their investments and they pick and choose their stock as part of their portfolio strategy on Tulipshare, except that it is very clear what the campaign is that’s going to be pushed in the background of every stock purchase. If you buy Coca-Cola, there is no doubt that Tulipshare is going to engage with Coca-Cola, the IR Team, the Board of Directors, other shareholders in Coca-Cola, in order to push the agenda of accelerating the plastic transition. And this is what we’re doing. We’re just reutilising something that was completely removed from retail investors, which is corporate governance and shareholder activism.

If you ask your friends or your readers how many have ever voted on shareholder resolutions or even know that they have shareholder rights, the answer is going to be very few. And yet, the rules are clear. If you own a piece of a company, you can have a say in the way a business is run. Now, will the company listen to you? That obviously depends on not only your passions, your backing and the shareholding backing your ideas, but ultimately, shareholder rights are inherent to stock and share trading.

It is crazy that it was never considered as a USP or corporate governance, which is completely left out by the industry. And if I take the list of all of your brokers that are listed on the Good Money Guide, we can go one by one and see which are the ones that are still sending paper proxy statements for its users to vote. The ones that are not even chasing its users to utilise their shareholder rights. The ones that are voting on their users’ behalf. The ones that don’t even have shares that have shareholder rights attached to them. All of this, it’s just completely crazy when you think about it, and what we are trying to do with Tulipshare is create one of the largest wealth platforms that is value-oriented and value-driven.

And it’s very simple. You buy Amazon to improve working conditions. Everybody knows there is a working condition problem at Amazon. We’ve been made to believe that it’s a consumer problem – stop using Amazon; use another site. So, we’ve been made to believe that it’s a political problem. Vote for X, Y, Z and, as its politician, they will sort out the Amazon warehouse working conditions. But it is a shareholder problem. Who are the owners of Amazon? They are the shareholders. And this is what we’re doing.

How it works is we basically engage with the companies and if we agree, then fine; we report the engagement or user base. Just like a private family office or a private legal team would be giving you reports on the progress of an engagement. And ultimately, if the company and us are in disagreement, we engage in two classic corporate governance tactics, which have been utilised by shareholder activists for years. I did not invent corporate governance. Activist private equity funds have been utilising corporate governance for years, except that we are the first one to do it for the retail investors, engaging with the companies and pushing solely ESG-oriented proposition.

Our ethos is very clear. We want to keep the system fair and sustainable. All the campaigns that are listed on Tulipshare go from tax evasion to child labour. Through to diversity and inclusion, climate change, plastic pollution, oil and gas financing. You can go very deep or you can go very high-level, but all the topics of people, planet and governance are on the ballots as Tulipshare campaigns.

Can people just invest a little bit or do you need to cross a threshold before you can start making meaningful change in a boardroom?

People can invest just a little, and we’re seeing that it’s the community of little investors that’s actually leveraging more discussion than an actual large asset owner. If you have 5,000, 6,000, 10,000 investors that each put £10, it’s better than having one person that puts £50,000, because it is the power of the community that opens the door of the media, of the company’s investors relation team, and of the other shareholders in those businesses.

Now, in order to submit a shareholder proposal in the US, you need $25,000 worth of stocks. In the UK, you need a hundred individual investors that own at least one share. The rules are not well-known and completely underutilised.

To give you an example, in 2021, Coca-Cola AGM, there was only one resolution. Why is that? It’s the largest plastic producer in the world. It’s one of the largest bottling companies. One of the biggest consumer beverage companies in the world, the most known brand. Why are no investors actually trying to shake the company strategy, utilising corporate governance?

So, all of this comes into Tulipshare being at the right place at the right time. If you think about it, more and more people are looking for solutions. They’re looking for solutions to the cost of living crisis and energy crisis, and the more and more corporate activists we leave in the system, the more we become an obvious solution.

Let me give you an example of what we did, in the 2022 AGM at Amazon. We had $39,000 of stock and we got 44% of shareholders to support our workers’ right resolution. That’s $600 billion of assets. Jeff Bezos himself had to block our resolution in order for it not to pass. The reality is we’ve provided more value to improve working conditions than anyone else, just because the topic was right, our scientific and ethical backing was correct. And we’ve managed to convince other large institutional assets that are in Amazon to support our resolution, despite the recommendation of the board. And that is crazy, if you think about it. The leverage is there. There’s no doubt that in our first year as a UK broker-dealer, we’ve shown that you could utilise corporate governance to drive positive change.

Let me give you another example. At Johnson & Johnson, we ran an activism campaign to remove cancer-causing product from the baby section. We got 16% of the voting support. Three months after the AGM, Johnson & Johnson withdrew the product. This is the power of corporate governance. You can change the system you live in by owning a piece of a company and saying, collectively, this is something that I want to change.

After you have your stake and put a resolution in front of the board, how do you reach out to shareholders to get support?

Usually, they reach out to you, because if you own 10% of Amazon and you receive a voting card to say what do you think about Tulipshare’s strategy, the first thing you do, you pick up your phone and you call Tulipshare and say I’ve never heard of you guys, who are you. And we’re just a group of Londoners, and that’s the reality. Everyone wants to be active. Everyone wants to be engaged. I haven’t met a single investor, a single shareholder that does not want to take action. It’s the system that is preventing people from participating and being more active, and it’s the historical investments and strategies that have created passive investors, but how can you be passive when you’re investing in a company that triggers cancer – that sells a product that triggers cancer. There’s no active or passive; you just have to take a stance. And the reality, we’re pushing this; now, you have to take a stance.

There is a roadshow involved obviously and we meet with institutional asset holders, big stock owners in those companies. We also are very public about our campaigns, so the media do write a lot about us, and that’s what creates very strong door-opening opportunities.

Last year, we ran a Right to Repair campaign at Apple. Apple has the largest market cap in the world. They probably meet only certain investors. They have met Tulipshare twice. They have us in meetings. The investors relation teams, some directors; they meet us, they sit down with us, they listen, and that’s something that you as an individual could never have had access to before, because the system was too decentralised, and the reality is that, through that, we’re able to deliver more value.

Is Tulipshare more about activism investing or is it about making money for customers?

It’s about both. The reality is that the ethos of our campaign is what we are very proud of, but Apple’s return is the same, whether you buy it on AJ Bell or Hargreaves Lansdown, Robinhood or Tulipshare. The reality is why would you use someone else that does not try to do good for the system you live in, if that’s money that’s sitting in your long-term portfolio anyway?

If you go to a pub and you ask who directly owns any stock – not in your SIPP, not in your company pension – who directly owns stock, you’ll realise that we’re still far from a massive influx of retail investors actually all flocking onto trading apps. The actual numbers in direct stock ownership are actually quite low, even if you look amongst the adult population that could actually trade. Our customers are first-time investors, under 35, and with a foot in the financial system because they’ve never been attracted by commission-free trading or by other platforms. Now, how do we make them grow with us? Those people have ISAs, pensions, SIPPs, and if your thesis is to fight climate change or to prevent child labour, why are you letting money sit somewhere else for 20, 30 years, and not pushing your value, because we know you’re an investor of thesis. And that is the strength of the Tulipshare communities.

Despite the stock market crashing, Tulipshare has a 75% buy-order ratio. People are here for the long term. They are here for the activism. They are here for the campaigns, the high-quality campaigns, the high-quality value that we provide as a platform to deliver. We see the platform as evolving towards more and more assets being transferred, more and more long-term investors coming in, because it’s not about just the ROI or the graph or the green or red candle, it’s about the campaign and the impact being delivered through the platform. In our first year, who could say that they’ve changed Johnson & Johnson and moved the needle at Amazon to improve working conditions?

Next year, we’re running 50 campaigns in 2023. At 50 campaigns, you have a very diversified portfolio approach. Very few people who directly own stocks own more than ten to twenty stocks. So, that’s one thing.

How sustainable is Tuplishare as a business if the focus is on activist investing?

This is why we don’t believe in commission-free trading. The fallacies of commission-free trading have just created this endless subsidised industry that is unable to now cope with itself, because the volumes are going down. With the cost of living crisis and share price going down, we might see five years of less trading volume. We take a commission on every trade. For very small trades we take 7%. So, it’s a sliding scale obviously, the more you invest, the less commission you pay. The average commission we take is around 7% at the moment.

If someone invests $100 in Apple stock, we’ll buy $93 of Apple and we’ll take seven to finance the activism. And rightfully, going after Johnson & Johnson is expensive, because those companies are pushing back with everything they can. You’re talking about a $400 billion business that you’re asking to make a drastic change with strategy and obviously, they are going to push back with everything they can. But the pushback provides more fuel on the fire for us. The community gets more engaged. People are willing to go deep down the activism agenda. We think more and more people are going to turn into associations of assets, because the reality is that there is an endless list of problems to fix, and we are showing, campaign by campaign, that it is working.

What did you do before Tulipshare and why did you set it up?

I worked for Match.com, Badoo, Bumble, and I worked in the dating space for seven years. I set up my own dating app that was then sold to a private equity firm. That was Lumen. A dating app for the over 50s. And we had 1.8 million users. It was a great story, but I don’t ever want to work in the dating space again. I’ve gone full circle. I’ve worked for the biggest app in the space, I’ve worked for great companies. We’ve changed thousands of people’s lives. That was really my focus along my career it was always to say am I doing something where if I explain it to someone, you put a smile on their face, and when you get customer feedback about a wedding, about someone having children, thanks to you working on the dating app, you know that you’re impacting people’s lives.

I don’t come from an investment banking M&A or Ivy League; that’s not who I am. I ended up into the ethical investing and the impact investing space because myself as a consumer, I wanted to invest my money ethically in ESG funds, and I hated the execution. I’m the kind of guy that reads the T&Cs.

When I read the T&Cs, I looked at the underlying securities that were bought, I realised, this industry is attracting trillions in assets, both in institutional and retail space, and it’s just full of greenwashing products. Surely I can do something about it. My understanding and knowledge of minority and majority interest in corporate governance of a private company led me to look into why can’t we do it into a publically-listed company. When I stumbled upon the corporate governance rule, I was like wait a second, why has no one never done this?

It might sound as crazy, but the only idea behind Tulipshare is two investors are stronger together than one when he speaks to Coca-Cola, and why was this never industrialised and done on the global scale? I don’t know. But now, we’re doing it and we’re doing it harder.

What are your hopes for the business?

From Berlin to Los Angeles. We’re getting our FINRA broker-dealer licence now, so we’ve applied for it in January, and we’ve had to go through a long process to be able to be a US broker-dealer. We’re going to do the same with Europe. There are very little London-based companies that actually start in London and then launch in the US, but we did it because of the favourable fintech environment in the UK, to initiate the first phase of the product, which was let’s see if we can run an activism campaign and let’s see if this product attracts people. And yes, it did.

We now have 5,000 investors on the platform; people who put money. I’m not talking about downloads or sign-ups, We have 5,000 micro-investors in the UK, from Portsmouth to Liverpool, and we’re very proud of it.

What are you most proud of so far?

Johnson & Johnson. Thousands of little girls will not get ovarian cancer, thanks to an activism corporate governance-led broker-dealer in the UK.

The same for workers’ rights at Amazon. Who is pushing the agenda to challenge the decision-making process of Bezos and its board of directors? It was Tulipshare. A very small, minority interest in the company that has managed to succeed into putting this on the global scale and say okay, I want everyone who owns a stock in Amazon now to decide, is this the company they want to keep owning stock in. And getting 44% sends a very signal to the board.

What’s been the worst part of setting up Tulipshare so far?

It’s been too short to have any worst. We look forward, never backwards.

How did you get the business started?

It was self-funded at the start, and then, everyone was telling me “I don’t think you can change Coca-Cola. They’re too big. I don’t think you can change Apple. Very good idea but you’re too idealistic.” And then, GameStop Reddit happened.

Millions of investors flocking onto the GME stocks, and that’s when the VCs that I was speaking to for six months were telling me, “Okay, now we might believe in your business.” I was telling them for almost seven months that, at some point, retail investors will rally together and it will happen. I had no idea this would happen so soon.

We’re showing that yes, like-minded people can bend together around value-driven investing. That’s what I was saying at the inception of the company and no one believed in it, but then you had millions of retail investors, and they might not be representing the AUM, the institutional assets that were also on the bandwagon and representing your right, but the reality was it showed that it is doable. That was a question mark that was lifted. Will retail investors really push something, an agenda, would they rally together? And they did. That was one of the foundation moments in the fundraising, because that allowed me to raise $12 million to be able to finance the business, hire 30 people, and really get this off the ground. And in our first year, we’ve shown that it works.

The reality is, we are the only ones to educate and to be the rising tide that raises all boats to really say, okay, this is how it works and if we actually do it this way, it can actually succeed. We’re the ones trying to do it at scale. We have 50 campaigns coming soon in 2023. We’re aggregating other people’s campaigns as well from elsewhere, because that allows us to scale faster.

Where did the name Tulipshare come from?

The name was an intended pun from tulip mania and the efficient market theory, which is today what is owning a share and definitely, that’s the link to it. It’s a great name.

The name suits the business and it’s saying your share today on any other broker is worthless because you can’t even utilise your corporate governance or your shareholder rights.

Tulipshare is making sure that those rights are being utilised.

What’s the one bit of advice you could give new investors to help them make more of their money?

My personal strategy, and that’s only mine, is to think long-term and to think into the companies that I think have very strong legs into being there ten to twenty years down the line. You can’t go wrong with long-term.

Where should people look if they want to find out more about activist investing?

Our blog is a great source of knowledge around activist investment. Now, I know that there are also some NGOs in the UK, such as ShareAction, that are promoting activist investing, with obviously a totally different angle, but they are a great source of knowledge. And as I said, we’re seeing ourselves as the leader in the fintech and broker-dealer space, but it’s the rising tides that raise all boats. We need every player in the space to keep educating the user base. I would love AJ Bell and Hargreaves Lansdown to send a newsletter about what is corporate governance and how to utilise your shareholder rights, because the more people realise it.

The core problem that we’re trying to fix is that it’s completely under-utilised and people don’t even know about it, and that’s crazy, because even some seasoned investors don’t even know that they have shareholder rights.

What do you think is wrong with ESG investing at the moment?

What I think is wrong with ESG is the complete greenwashing of the industry. It is a very appealing marketing proposition that is completely mis-utilised today.

Look at the underlying securities that are bought. Look at the voting guidelines that are issued. Look at what they vote. The vote is public. The beauty of it is you can buy and ETF that is owned by a huge financial institution, or managed by, and then you can look at their voting pattern. You can see what they voted on on resolutions that were ESG-oriented, such as deforestation, improving workers’ rights, diversity and inclusion, and you can see if they put their money where their mouth is. And you look at the voting results on ESG resolutions, well, you clearly understand that there is the marketing and the brochure, and then there is the actual reality. And that’s where Tulipshare is actually.

We’ve sent out the voting results. We’ve created a page where you can see how they voted. So, you can see basically. This is why we’re going to succeed, The reality is the facts are there. We have the product that delivers the most impact, whether it’s for retail or institutional, and the rest of the industry today has been completely destroying the name of ESG.

We look at BlackRock, State Street, Vanguard voting patterns on workers’ rights, on women’s rights, child labour, and we see the votes. Why would you put trillions in a BlackRock-managed ETF that is supposedly ESG when they’re voting against hundreds of workers’ rights, women’s rights, racial equity, say on pay resolutions?

Antoine Argouges is founder and CEO of Tulipshare, an activist investment platform

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