Rick Rule's Mining Story

Arthur Richards Rule IV, better known as Rick Rule, born in February 1953, has made a true fortune as a junior mining speculator, establishing himself as a prominent

Arthur Richards Rule IV, better known as Rick Rule, born in February 1953, has made a true fortune as a junior mining speculator, establishing himself as a prominent figure in the world of resource investment and speculation. His journey from a bouncer in Vancouver to becoming a leading figure in the natural resource sector is a testament to his resilience and dedication to the world of mining finance.

In the 1970s, Rick Rule started his career as a bouncer at the Broadway Hotel in the heart of Skid Row, Vancouver. It was a bar situated at the notorious corner of Columbia and Hastings, and Rule's background in boxing made him a natural fit for this role. Little did he know that this seemingly unrelated gig would become a stepping stone to a remarkable career in finance. Over time, Rick's interactions with influential figures at the bar led him to gain invaluable insights into the Vancouver Stock Exchange, which would become the foundation of his future success. In 1974, he officially embarked on his career in the securities business.

Rick's initial aspiration was to become a tax lawyer. However, his path took a different turn after a lunch meeting with a prominent tax lawyer in Vancouver. This lawyer, recognizing Rule's potential, introduced him to Canadian value investing icon Peter Cundill. Under Cundill's mentorship, Rick received a crash course in the basics of investing and was given copies of investment classics like "The Intelligent Investor" and "Security Analysis." He even had the privilege of shadowing Cundill in his office for several months, an experience that Rule would later describe as life-changing. Cundill's teachings exposed Rule to the concept of identifying undervalued assets within companies, a strategy that would become instrumental in his later success. Rick also delved into the work of Marty Whitman, focusing on cyclical value and assets within out-of-favor industries.

As the years passed, Rick's entrepreneurial spirit led him to explore capital formation and resource investment. Throughout his early years in the industry, Rule experienced the highs and lows of the resource market, learning invaluable lessons along the way. During the 1980s, after accumulating significant wealth during a resource bull market, he endured the devastating loss of his fortune when the market took a downturn. This experience reinforced the importance of understanding market cyclicality and turned Rick into a determined contrarian.

In the mid-1980s, Rick Rule's involvement in public companies deepened. He served as a board member of International Phoenix Energy, only to resign from the board in 1985, along with Murray Pezim and John Brown. In 1988, he founded the brokerage business Accredited Capital, which later transformed into Global Resource Investments Ltd in 1994. The company's decision to focus exclusively on the natural resource sector was a testament to Rick Rule's experience and expertise. In 1998, Rick Rule extended his footprint in the industry by establishing Resource Capital Investment Corp., a manager of pooled investment vehicles specializing in natural resource companies. He also founded Terra Resource Investment Management, now known as Sprott Asset Management USA Inc., a registered investment advisor offering segregated managed accounts.

The 1990s saw Rick Rule emerge as one of the prominent figures in the junior mining business, and was seen a lot at conferences alongside notable names like Doug Casey, James Blanchard, Adrian Day, Bob Bishop, and Brien Lundin. It was a decade of explosive growth, with companies experiencing price increases of 10x or even 20x. Some of these gains were driven by genuine discoveries, while others were the result of promotional campaigns. Rick had notable successes in names like Cornucopia Resources, Altoro Gold Corp, Yuma Copper, and International Panorama.

Towards the end of the 1990s, Global Resource Investments administered approximately $1.3 billion and managed over $397 million in client assets across various business lines.

As the 2000s dawned, Rick Rule professionalized further, becoming a leading American retail broker and analyst specializing in mining and energy. He became an associate editor of Jim Blanchard's Gold Newsletter and was a key figure in shaping the educational model in the junior mining sector. Rick led an educational series called "The Mining Investment College," sharing his wealth of knowledge with aspiring investors.

In 2001, Global Resource Investments Ltd was home to a staff of 25 brokers, analysts, and operations professionals, serving the needs of over 8,000 resource investors. At this time, Rick was one of the few remaining figures in the junior mining space, as the industry was going through a difficult time. Global Resource Investments stood out by having an on-staff geologist, Brent Cook, who conducted full-time exploration analysis. This geological expertise played a crucial role in identifying promising opportunities, such as the Virginia Gold story.

Rick Rule passionately advocated for the 'prospect generator' model of exploration. Prospect generators focused on finding numerous, highly promising early-stage prospects through technical methods. They conducted initial, cost-effective exploration to establish a project's potential and then attracted cashed-up joint venture partners to fund later-stage exploration and development.

In 2010, Sprott Inc acquired Global Resource Investments from Rick Rule in a stock swap valued at $90 million. Rick continued his work within the Sprott brand and gained even greater recognition in the industry. His numerous interviews, presentations, and educational content solidified his position as a leading voice in resource investment. Sprott Inc, at the time of takeover, boasted 44 employees and administered significant assets. It was comprised of three main business lines: RCIC, which managed assets for pooled investment vehicles; SAM USA, formerly Terra Resource Investment Management, a registered investment advisor offering segregated Managed Accounts; and SGRIL, a full-service U.S. brokerage firm providing personalized brokerage services to investors in the natural resource sector.

In 2021, Rick Rule stepped down from his senior managing director role at Sprott Inc. and President & CEO of Sprott U.S. Holdings. However, he continued to serve as a director at Sprott and played an ongoing role in managing certain Sprott investment strategies. At that time, he owned 2.65 million shares of Sprott, valued at $106 million.

Rick Rule's impact on the industry extended beyond his role at Sprott. He is both the President and CEO of Rule Investment Media, where he hosts conferences. Additionally, he is part of a new bank called Battle Bank, serving as a Board Member.

He also started “Rule Classroom” with Albert Lu. Rule Classroom is an online learning community for natural resource investors. It offers video courses, interviews, and a community of like-minded investors, providing a platform for education and networking.

Rule remains actively engaged in private placement markets, participating in hundreds of debt and equity transactions. His expertise and boundless passion for the world of resource investments serve as a powerful source of inspiration for the emerging generation of resource investors, motivating them to persevere and strive for success.