Antifragile investment firm, trading below NAV and at 4 times FCF, with multibagger potential
Manolete Partners Record Bankruptcies Ignite 5× Upside
Success rates north of 90 percent, a money multiple of 2.2 ×, a 130 percent IRR, and a pay-back period of barely two years—those are hard numbers to beat.
Today’s spotlight is on an investment firm disguised as a law firm: Manolete Partners. It evaluates hundreds of high-return opportunities each year yet cherry-picks fewer than one-third. Because its financial statements are hard to read and pandemic-era government support temporarily suppressed insolvency volumes, the market has pushed the shares below NAV. Even on cautious assumptions, the potential upside exceeds five-fold within three to five years. Operational leverage is now set to kick in: the company is again landing higher-ticket cases, and management expects average revenue per case to double, which should send profits sharply higher.
Manolete Partners (ticker MANO), trading on London’s AIM with a market capitalisation of about £37 million, buys insolvency litigation claims outright and then shares any recovery with the insolvency practitioner and creditors. Its in-house lawyers behave like buy-side analysts, while external counsel handles the courtroom work—though most matters settle long before trial thanks to the firm’s reputation. The founder still owns roughly ten percent of the equity, yet the stock trades nearly eighty percent below its peak and around half its IPO price, just as UK bankruptcies reach record levels. Investors can therefore pick up an antifragile business for pennies on the pound, gaining both high return potential and resilience in downturns. Do you have anything like this in your portfolio? Probably not.
In the pages that follow we will explore the sector tailwinds, dissect Manolete’s business model, and present a conservative valuation that highlights its operating leverage. Enough preamble—let’s dig in.
1. Sector tailwinds, record high bankruptcies in the UK:
UK company insolvencies are at record highs. Since Manolete’s latest half-year presentation, the headline total has continued to climb, rising at a high-single-digit rate year on year through the first half of 2025.
Manolete estimates that roughly £750 million could be recovered from these insolvencies each year. Adjusting that figure to about £800 million to reflect the latest uptick, and applying Manolete’s fifty-fifty profit-sharing model, gives a conservative addressable market of around £400 million a year—growing at a high-single-digit clip. With revenue still below £40 million, Manolete has ample headroom, and its operating leverage means incremental volume should translate into disproportionate gains in net income.
To put the trend in context, the table below shows that UK insolvencies are approaching 2008 levels, yet the market prices Manolete as if demand were in decline.
The business is structurally antifragile. Demand for its services remains robust during downturns and stays solid in normal conditions, giving the company unusual stability.
During the pandemic, government support deferred many failures, temporarily depressing insolvency numbers and shrinking Manolete’s average profit per case. That pause has ended. Administration bankruptcies and compulsory liquidations are now expanding at double-digit rates and have begun to exceed pre-Covid levels, just as management predicted. These larger, more complex cases tend to be more lucrative, so margins should recover and the firm’s operating leverage should re-emerge.
The current share price does not reflect any of this. Market pessimism offers an unusually attractive entry point into a business that combines strong growth prospects with resilience in economic stress.
2. Business model:
Manolete is the UK reference point for corporate-insolvency litigation. It dominates the niche of buying—and occasionally funding—claims that arise once a company enters insolvency. By purchasing a claim outright, Manolete steps into the shoes of the creditors, pursues recovery on their behalf, and earns its fee only if the case succeeds. Economic incentives are therefore fully aligned.
The remainder of this article—an in-depth review of the firm’s financials, key risks, historical performance, reasons for the share-price decline, upcoming catalysts, and a conservative valuation— is reserved for paid subscribers at just one dollar a day.