Compounders: The Anatomy of a Multibagger: Recent Episodes
Ben Claremon & SNN Network
Cove Street Capital Portfolio Manager, Ben Claremon, interviews public company executives to understand how successful leaders compound shareholders’ wealth over time. For more information about Cove Street Capital, please visit: www.CoveStreetCapital.com
This is a very special episode of Compounders: number 100. To celebrate that milestone, my guests on the show today are Alex Rubalcava and Connor Sundberg, Managing Partner and Partner, respectively, at the early-stage VC firm Amplify LA. Alex and I have been friends for many years, and it is an absolute treat to finally get him on the podcast. Alex recently merged his firm, Stage Venture Partners, into Amplify, where Connor was already a Partner. In this intriguing conversation, we covered:
- The rationale for the merger of the two investment firms;
- How they expect decision making and sourcing to change going forward;
- The idea of focusing on companies that are tackling challenges that are different and hard;
- Their current views on the pre-seed and broader venture capital investment universe; and
- How the SaaS-pocalypse is and isn’t impacting how they view investing in enterprise software companies.
My guest on the show was Bob Frady, the CEO and co-founder of PropertyLens, a company that aims to become the CARFAX for residential real estate. After a number of successful prior ventures, Bob co-founded PropertyLens to solve what he sees as a large information asymmetry between home sellers and home buyers. With that as the background, I was excited to speak with Bob about:
- The founding inspiration for PropertyLens;
- The unmet need the company’s property reports are filling for homebuyers;
- The existing competitive set that is tackling similar problems;
- How the various players in the home selling ecosystem are reacting to the emergence of PropertyLens; and
- How he defines success going forward for the company.
To learn more, please visit https://www.propertylens.com/
My guest on the show this week was Jonathan Nurick, the founder and Co-CIO of DivGro, an Australia-based investment management firm that puts dividends at the center of its investing strategy. Jonathan started DivGro at a relatively young age, and the firm’s AUM has grown substantially over the recent years. In this intriguing conversation, we covered:
- The founding inspiration behind DivGro;
- How Jonathan began to center on dividends as a signal;
- What people underappreciate about dividends;
- Portfolio construction, including concentration and position sizing; and
- What a quintessential DivGro investment looks like.
To learn more about DivGro, please visit the firm's website: https://www.divgro.com.au/
My guest on the show this week is Jake Barfield, the founder of Asheville Capital Management, a long-only investment firm that seeks to invest in world-class companies before they are broadly recognized as such. Jake is also the host of his own podcast, Quality Investing. In this informative episode, we covered:
- The founding inspiration for Asheville;
- The type of companies that Jake is NOT going to invest in;
- Position sizing and concentration;
- What Jake finds so interesting about a company called InPost; and
- Why he decided to start his own podcast.
For more information, please check out Jake's website, and Jake's excellent podcast, Quality Investing.
My guests on the show are Michael Demaray and Vishal Mishra of Bard Associates, a boutique wealth management firm that has been in business since the 1980s. Michael and Vishal are true value investors who like to look in places other investors neglect. Specifically, Bard invests in a space that is near and dear to my heart: US microcap stocks. In this informative conversation, we discussed:
- The strategies that Bard runs today for its clients;
- The firm’s long history of investing in small companies;
- Why some microcap stock prices are so volatile;
- The common characteristics of a core Bard holding; and
- The firm’s approach to interacting with company management.
Please see Bard's website for more information: https://www.bardassociatesinc.com/
My guest on this episode is Alex Rawlings, the Founder and Managing Partner of Raw Selection, an executive search firm that specializes in finding talent for PE firms and their portfolio companies. He is also the host of an excellent show called The Private Equity Podcast, which I was fortunate enough to be a guest on. In this informative conversation, we covered:
• The founding inspiration for Raw Selection;
• The opportunity Alex saw to differentiate Raw Selection from other exec search firms;
• The evolution of the talent recruitment industry that is focused on PE firms;
• Common mistakes PE firms make when hiring execs for portfolio companies; and
• How Raw Selection has developed an expertise in sourcing execs in the white hot HVAC space.
To learn more, please visit Alex's LinkedIn page: https://www.linkedin.com/in/alexrawlings/
Also, here is the link to Alex's upcoming book: https://www.raw-selection.com/how-to-hire/
My guest on this episode is Cody Payne, an SVP at Colliers and an expert on what is an emerging asset class within real estate, flex industrial. This is a little bit of a different podcast where we dive into this corner of the commercial real estate market and discuss why Cody thinks it could become a real institutional asset class. In this informative discussion, we covered:
- What flex industrial space consists of;
- The degree of institutional interest in the space today;
- The positive attributes Cody thinks flex industrial space offer investors;
- Current supply-demand dynamics in the market; and
- The book that Cody and his team wrote about flex industrial real estate.
Please see Cody's LinkedIn page to learn more about him.
Here is the link to the book that Cody and his team wrote on this asset class: Flex Space Domination
Our guest on the show this week was Andrew Hollingworth, the Portfolio Manager at HollAnd Advisors. Andrew has an eclectic background and, like many of previous guests, has centered his investment strategy around the search for compounders. In this informative conversation, we covered:
- How Andrew developed the investment philosophy he is employing today;
- Why he likes to invest behind owner-managers;
- His definition of a supernatural compounder;
- His contrarian stance on Biglari Holdings; and
- Why he is OK investing behind executives that other investors dislike
To learn more, please visit Andrew's LinkedIn page and the HollAnd Advisors website.
Thanks for listening.
My guest on the show today is Andy Kurita, the Portfolio Manager at Kettle Hill Capital Management. Andy has a track record in long-short investing in small cap US equities that goes back to the early 2000s. We haven’t had many managers who actively short on the podcast and I was curious to hear from Andy about:
- How Kettle Hill is differentiated versus other hedge funds;
- What he thinks about the small cap investing landscape today;
- The difference between a stock that fits in the long book versus in the short book;
- What it has been like to be a short investor in recent years; and
- How he thinks about concentration and risk management.
My guest on the show today is Joe Magyer, the Founder and Managing Partner at Seaplane Ventures. Joe spent the first part of his career in public equities and in 2022, founded Seaplane to focus on early stage investing. We have not had many VCs on the podcast before, and I was excited to speak with Joe about:
• His journey from public markets to venture investing;
• What the name Seaplane means to him;
• Where the firms plays in the VC ecosystem;
• Why he has decided to concentrate his investments; and
• How the skill set he developed after a long time in public markets helps him with his new venture today
Here is the link to Joe's bio: https://www.linkedin.com/in/joemagyer/
Here is the link to Seaplane's website: https://www.seaplaneventures.com/
My guest on the show today is Matt Blair, the co-founder and CEO of REI Capital Management. Private real estate has been an asset class that has performed well over many years—but has largely been inaccessible to the average individual investor. In co-founding REI, Matt has the goal of democratizing access to private real estate investments. In this enlightening conversation, Matt and I discussed:
- How retail investors can typically access private real estate investments today;
- Why REI has gone through a lengthy SEC process to try to expand access to private real estate;
- The investment strategy REI is employing;
- Important investor considerations such as diversification and liquidity; and
- The types of property Matt is looking to acquire—without overpaying of course.
For more information about REI Capital Management, please visit: https://reicapitalmanagement.net/team-member/matthew-blair/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guest on the show this week is Tim Call, the President and CIO of The Capital Management Corp., a long-only investment firm that focuses on cash cows. The firm has been around since the 1960s and has remarkable client retention numbers. In this enlightening conversation, Tim and I covered:
- The lasting legacy of the firm;
- What a cash cow means to CMC;
- Why they think SMID cap is a great place to be investing;
- The philosophy surrounding portfolio concentration; and
- How to get the most out of a small investment team.
For more information about The Capital Management Corp., please visit: https://cmcva.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Tal Keinan, the CEO of Sky Harbor Group, a publicly traded developer and operator of airplane hangars. Before conducting the interview, I had the opportunity to learn a lot about Sky Harbor from an investor friend who owns the stock and knows the company as well as just about anyone on the planet. That led to a deep, rich conversation where we covered:
- The process by which Sky Harbor became public;
- Whether Sky Harbor is a real estate company, an operating company—or both;
- An overview of the supply and demand dynamics for business aircraft hangar space;
- How Sky Harbor views the threat of emerging competition; and
- The economics and returns associated with developing new hangars.
For full disclosure, I am not a Sky Harbor shareholder.
For more information about Sky Harbour Group, please visit: https://skyharbour.group/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Tania Pouschine, the Founder and Portfolio Manager of Fithian. I reached out to Tania to have her on the podcast after I heard from an allocator friend that Fithian employed one of the most unique and differentiated investment processes in the public equity space. With that as the backdrop, I was excited to speak with Tania—who was formerly an investigative journalist—about:
- The circumstances surrounding the founding of Fithian in 2016;
- How being an investigative journalist informs her investment process;
- Fithian's perspective on what performing deep due diligence on companies actually looks like;
- The global long-only strategy Fithian runs for clients; and
- The characteristics of a prototypical Fithian stock
For more information about Fithian, please visit: https://www.fithianllc.com/
This episode is sponsored by: Daloopa
Earnings season—two words that can make any analyst’s heart race. The late nights, the endless manual updates, and the constant pressure to deliver timely, accurate insights—it’s overwhelming. But it doesn’t have to be.
With Daloopa, you can revolutionize the way you work. Their automated model update solution takes the manual effort out of the equation, delivering complete, accurate, and real-time financial data at the click of a button. No more endless spreadsheets. No more scrambling to keep up.
Daloopa empowers you to initiate coverage faster, refine your investment theses with confidence, and focus on what really matters—identifying key opportunities and delivering actionable recommendations that drive results. Plus, with fully auditable data, you’ll always have the confidence that your insights are backed by accuracy.
So, if you’re ready to get ahead of earnings season and take your analysis to the next level, visit daloopa.com/comp today. Daloopa—because your time is too valuable to spend it on data entry: https://go.daloopa.com/comp
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guests on the show today are Brent Robinson and Kevin Fogarty of Value Creators, a US-focused public equity firm that has a long track record of success. After working together for a number of years at Dupont Capital Management, Brent and Kevin helped found Value Creators in 2023. When I heard about the proprietary process the firm uses to assess capital allocation, I knew I had to have them on the podcast. In this fascinating conversation, we covered:
- The long history the Value Creators team has together;
- The circumstances surrounding the founding of the firm;
- How they assess capital allocation;
- Portfolio construction, including concentration; and
- The process they use to whittle down their investment universe.
For more information about Value Creators Capital, please visit: https://www.valuecreatorscapital.com/
This episode is sponsored by: Daloopa
Earnings season—two words that can make any analyst’s heart race. The late nights, the endless manual updates, and the constant pressure to deliver timely, accurate insights—it’s overwhelming. But it doesn’t have to be.
With Daloopa, you can revolutionize the way you work. Their automated model update solution takes the manual effort out of the equation, delivering complete, accurate, and real-time financial data at the click of a button. No more endless spreadsheets. No more scrambling to keep up.
Daloopa empowers you to initiate coverage faster, refine your investment theses with confidence, and focus on what really matters—identifying key opportunities and delivering actionable recommendations that drive results. Plus, with fully auditable data, you’ll always have the confidence that your insights are backed by accuracy.
So, if you’re ready to get ahead of earnings season and take your analysis to the next level, visit daloopa.com/comp today. Daloopa—because your time is too valuable to spend it on data entry: https://go.daloopa.com/comp
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Nic Johnson, the founder of Listwise, a company that is trying to revolutionize how residential brokers get paid when helping clients sell their homes. After spending many years at PIMCO as a portfolio manager, Nic founded Listwise in 2022 to help create better alignment between home sellers and their brokers. In this wide-ranging discussion, we covered:
- What led Nic to start Listwise;
- The problem associated with selling a home that the company is attempting to solve;
- How Listwise incentivizes brokers to get the highest price for a seller;
- Common mistakes homeowners make when they are selling their house; and
- How the company is attracting customers
For more information about Listwise, please visit: https://listwise.com/
This episode is sponsored by: Daloopa
Earnings season—two words that can make any analyst’s heart race. The late nights, the endless manual updates, and the constant pressure to deliver timely, accurate insights—it’s overwhelming. But it doesn’t have to be.
With Daloopa, you can revolutionize the way you work. Their automated model update solution takes the manual effort out of the equation, delivering complete, accurate, and real-time financial data at the click of a button. No more endless spreadsheets. No more scrambling to keep up.
Daloopa empowers you to initiate coverage faster, refine your investment theses with confidence, and focus on what really matters—identifying key opportunities and delivering actionable recommendations that drive results. Plus, with fully auditable data, you’ll always have the confidence that your insights are backed by accuracy.
So, if you’re ready to get ahead of earnings season and take your analysis to the next level, visit daloopa.com/comp today. Daloopa—because your time is too valuable to spend it on data entry: https://go.daloopa.com/comp
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Todd Wenning, the President and CIO of KNA Capital. Many of our listeners might have come across Todd’s excellent discussions of moats during his time at Morningstar and Ensemble Capital—or on his Substack Flyover Stocks. Todd founded KNA Capital earlier this year and I was eager to speak with Todd about:
- What pushed him to start his own firm;
- Why economic moats are so important to him and his process;
- How he decided on the right level of concentration;
- What he finds so valuable about the process of teaching undergrads; and
- Why nostalgia can be a very attractive theme to invest behind
For more information about KNA Capital, please visit: https://www.kna-capital.com/
For more information about the Flyover Stocks substack, please visit: https://www.flyoverstocks.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show this week is James Emanuel, a private investor and the founder of Rock & Turner. James has thought deeply about many aspects of the investment world—and is an active writer on his Substack as well as being the author of a number of books. In this deep conversation, we discussed:
- What led James to focus on investing full time;
- Why he decided to run what is essentially an all-cap global strategy;
- The reasons he has such a negative opinion of dividends;
- Why he calls stock-based compensation the most abused aspect of corporate finance; and
- His newest book, Fabric of Success
James mentioned several securities on this podcast. The only one I own is Berkshire Hathaway. For more information about "Fabric of Success", you can purchase your copy here: https://www.amazon.com/Fabric-Success-Threads-Tapestry-Business/dp/B0D5W7B9W1
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Dan Rupp, the Founder and CIO of Parkway Capital. After spending many years at a very well-known, Asia-focused investment firm called Overlook, Dan founded Parkway Capital to take advantage of some of the less liquid and smaller-cap opportunities he was consistently unearthing. Dan is the first Asia-only investor we have had on the podcast, and I was excited to speak with him about:
- The types of opportunities he thought he could invest in with a smaller capital base;
- How he is building his team and his asset base;
- The Parkway portfolio, which consists of Compounders, Defensive companies and Deep Value stocks
- Why he is so constructive on the Chinese market right now
- The investment case for Chinese white goods manufacturer, Haier
Dan mentioned a handful of securities on this podcast. I don’t own any of them.
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is the Bill Bennett, the CEO of Innovative Foods Group. After a number of years for working for big companies like Wal-Mart and Kroger, Bill became the CEO of Innovative Foods in early 2023. Since that time, he has been leading an aggressive business improvement plan that has started to bear fruit. In this conversation, we covered:
- What initially attracted Bill to the company and the CEO role;
- Where Innovative Foods plays within the specialty foods subsegment of the massive foodservice industry;
- The divestitures the company has made to simplify the business;
- The secular tailwinds behind the specialty foods category; and
- What the company needs to do to hit its EBITDA and revenue targets.
For full disclosure, I am not an IVFH shareholder. For more information about Innovative Food Holdings, please visit: https://investors.ivfh.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Adam Wilk, the Founder and CIO of Greystone Capital Management. Adam is a savvy microcap investor who prefers to run a very concentrated portfolio. In this in-depth conversation, we covered:
- How Adam applies learnings from being an NBA scout to the investing realm;
- Why he has chosen to own so few companies;
- The types of microcap companies that Adam gravitates toward;
- His approach to assessing management teams; and
- What it was like starting a new firm in March of 2020.
For full disclosure, Adam mentioned a number of securities on this podcast. I do not own any of them. For more information about Greystone Capital Management, please visit: https://www.greystonevalue.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jim Cunniff, President and CEO of Electromed, Inc. (NYSE American: ELMD). Electromed is best known for its main products, the SmartVest, a medical device that helps people with a chronic lung condition breathe easier and have a better quality of life. After working at Baxter and Stryker, Jim became CEO in 2023 and has brought a new level of focus and urgency to the Electromed. In this conversation, covered:
- Why Jim decided to take the CEO role at Electromed;
- What is special about the SmartVest, as well as the drivers of growth;
- Why Bronchiectasis remains an underdiagnosed condition;
- What he has learned from being an operating partner at Shore Capital; and
- How the company generates 70%+ gross margins.
For full disclosure, I am not an Electromed shareholder. For more information about Electromed, please visit: https://investors.smartvest.com/overview/default.aspx
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jim Edwards, the founder and managing partner of Maestria Partners. Jim spent a number of years working for big university endowments until launching Maestria in 2023. Jim is a fundamental investor at heart who thought deeply about how to differentiate his firm before going out on his own. In this wide-ranging conversation, we discussed:
- Jim’s journey from the allocator world to launching his own investment firm;
- What he learned about differentiation and best practices during his time as an allocator;
- The types of business models he gravitates toward;
- His approach to valuing companies that the market already has a deep appreciation for; and
- Why he has chosen to run a pretty concentrated portfolio
For more information about Maestria Partners, please visit: https://maestriapartners.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Carl Herberger, the CEO or Corero Network Security. Carl joined Corero, a UK-listed microcap company, at an exciting time for the company. Cybersecurity is such a hot space that I was excited to speak with Carl about:
- What he thought was so compelling about the opportunity to lead Corero;
- Where the company’s products play in the cybersecurity ecosystem;
- How a small company lands partnerships with well-known, large companies;
- Ways in which AI is going to impact the cybersecurity market going forward; and
- How he is currently balancing the tension between achieving growth and better profitability
For full disclosure, I am not a Corero shareholder.
For more information about Corero, please visit: https://www.corero.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Yuri Khodjamirian, the CIO at Tema. Tema is an innovative company that is trying to revolutionize the ETF industry. The company has a passion for providing investors, especially those in retail space, with access to institutional quality managers and strategies. In this in-depth discussion, we covered:
- Tema’s mission at it relates to providing quality access to ETF strategies
- How Tema is trying to differentiate its ETFs within a very crowded space
- Why some prominent venture firms thought was so attractive about Tema to warrant an investment;
- The strategy behind the Tema Monopolies and Oligopolies ETF, ticker TOLL; and
- His approach to establishing an edge in well-known stocks.
For more information about Tema ETFs, please visit: https://temaetfs.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Mathieu Martin, the Portfolio Manager of the Rivemont Microcap Fund. Mathieu is a microcap specialist who focuses on Canadian stocks. I have personally become fascinated with the differences between the US and Canadian markets, and I was excited to talk to Mathieu about:
- Where his love for microcap stocks began;
- The level of inefficiency he sees within Canadian microcaps;
- Why US-based investors don’t venture up to Canada as often as they should; and
- What he learned after having a tough year in 2022;
- Just how cheap Canadian microcaps are at the current moment
For more information about Rivemont MicroCap Fund, please visit: https://rivemont.ca/en/rivemont-microcap-fund/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is author and investor, Brendan Hughes. Brendan wrote a very interesting book entitled Markets in Chaos where he analyzed various boom-and-bust cycles that have happened over history. Brendan is also on the investment team at Lafayette Investments, a Maryland-based RIA. In this wide-ranging discussion, we covered:
- The major lessons he learned from writing Markets in Chaos
- Lafayette’s approach to security selection;
- How he and his firm define a quality company;
- Similarities and differences between today and the 1970s US energy crisis; and
- Why he has a strong distaste for the value and growth labels that get placed on investment strategies
For more information about Lafayette Investments, please visit: https://www.lafayetteinvestments.com/
"Markets in Chaos" on Amazon: https://www.amazon.com/Markets-Chaos-History-Market-Crises/dp/1637425147
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Chet Rastogi, Partner and Portfolio Manager of Heron Bay Capital Management. Chet is a seasoned investor who helps the firm run both its discretionary and systematic strategies. In this interesting conversation, we discussed:
- Heron Bay’s definition of a quality company;
- What it means to be a good steward of clients’ capital;
- Why the firm employs both discretionary and systematic strategies;
- How he thinks about concentration in both types of strategies; and
- The case for continuing to run a microcap strategy
For more information about Heron Bay Capital Management, please visit: https://www.heronbaycap.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Bogumil Baranowski: author, podcast host and the Founder of Blue Infinitas Capital. Many people may know Bogumil for his excellent podcast, Talking Billions. However, as I turned the microphone around on Bogumil, I was interested in learning about his investment philosophy and approach. In this in-depth conversation, we covered:
- The founding inspiration for Blue Infinitas Capital;
- What types of clients he hopes to attract to his new firm
- The types of companies Bogumil gravitates toward;
- The value he derives from writing books; and
- How you invest if you have an infinite time horizon;
For more information about Talking Billions Podcast, please visit: https://www.talkingbillions.co/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Tom Bachrach, the Principal at PFH Capital. Tom is an eclectic investor who travels around the world looking for mispriced smaller companies, especially those in markets that a lot of other investors shy away from. He also is willing to invest in sectors that other people shun for various reasons. With all of that as background, I was looking forward to chatting with Tom about:
- The founding inspiration for PFH Capital;
- The countries and markets he tends to gravitate towards;
- What it means to seek companies with healthy financials;
- Why he is interested in investing in companies with exposure to commodities
For more information about PFH Capital, please visit: https://www.pfhcap.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on this show today is Meb Faber, the CEO at Cambria Investment Management. Cambria manages a number of ETFs that in total have over $2 billion in AUM. Meb is also the host of an excellent podcast where he interviews people from all different corners of the investment world. I have been a listener of the podcast for years but recently realized that I knew a lot more about Meb the podcast host than I did about Cambria. Accordingly, I was interested to chat with Meb about:
- Cambria’s journey to get to over $2 billion in AUM;
- Who the target audience is for the various ETFs;
- The Trinity portfolios that Cambria offers its clients;
- What is so interesting about “shareholder yield” strategies; and
- How Cambria differentiates itself in a the now crowded ETF space
For more information about Cambria Investment Management, please visit: https://www.cambriainvestments.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Whit Huguley, the Portfolio Manager at River Oaks Capital. Whit is a microcap specialist who has been running this portfolio full time since early 2020. Whit puts together one of the most comprehensive quarterly letters I have ever seen—in many cases discussing all the companies in his portfolio. As I learned more about his process and philosophy I became curious about:
- Why he first became interested in microcaps;
- The checklist he uses to evaluate stocks;
- His rationale for investing in small banks and financials;
- Why he places so much value on traveling to meet with companies; and
- How he approaches the topic of when his companies will eventually get valued properly
For more information about River Oaks Capital, please visit: https://www.riveroaks-capital.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Maj Soueidan, the Co-Founder of GeoInvesting. Maj is a microcap expert who has been investing in the space for over 30 years. Maj and his team are always searching for potential multi-baggers as they perform extensive research on top-tier microcap companies. Given how out of favor microcaps are at the moment, I was curious to speak with Maj about:
- Why it has been so tough to be a microcap investor in recent years;
- What he looks for when he is assessing management teams;
- His approach to portfolio construction, especially given the illiquid nature of many microcap stocks;
- What most people misunderstand about microcaps; and
- The opportunities available in Canadian microcaps.
Maj mentioned a number of securities on this podcast. I do not own any of them. For more information about GeoInvesting, please visit: https://geoinvesting.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Scott Colson, the CIO of Irrational Capital. Scott has partnered with well-known academic and author Dan Ariely to build indexes based on human capital assessment—and partner with asset managers to create ETFs--that are tied to a proprietary metric they call the Human Capital Factor. In this eye-opening discussion, we covered:
- The founding of Irrational Capital and how Scott got involved;
- The various ETFs that Irrational Capital has launched with Harbor Capital;
- What types of companies score highly when it comes to the Human Capital Factor;
- The simplicity of and alpha generating potential of using the Human Capital Factor; and
- The differences between the larger and smaller cap ETFs.
Scott mentioned a number of securities and ETFs during this podcast. I don’t own any of them. For more information about Irrational Capital, please visit: https://www.irrational.capital/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Mac Sykes, the Portfolio Manager of the Gabelli Financial Services Opportunities Fund. Mac has been with Gabelli for over 15 years and runs a portfolio that is focused on the financial services industry. We haven’t had many chances to discuss banks on this podcast. So, I was excited to speak with Mac about:
- The major tailwinds he and his team believer are supporting the companies in the portfolio;
- How technology is transforming and impacting the incumbents in the financial services industry;
- The future of Berkshire Hathaway as we approach an inevitable change in leadership;
- Portfolio construction and especially concentration; and
- How the big money centers banks are positioned to weather the next credit cycle
For more information about the Gabelli Financial Services Opportunities Fund, please visit: https://www.gabelli.com/funds/etfs/gabf
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guests on the show today are Jen Yu and Alex Penfold, the co-founders of Jaxon Lane, a beauty and skin care company they run as a husband and wife team. I have known these two for many years and am a user of their products. Jaxon Lane is known for its Bro Mask, a product whose goal it is to make healthy facial skin more accessible to men. In this wide ranging discussion, we covered:
- The founding idea and story of Jaxon Lane;
- How Jen and Alex figured out how to navigate a brand new industry;
- The differentiation that comes from focusing on male skin care products;
- Their strategy for growing both e-commerce and brick and mortar sales; and
- Their approach to new product innovation
For more information about Jaxon Lane, please visit: https://jaxonlane.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is John Zolidis, the President and Founder of Quo Vadis Capital. John is a consumer and retail specialist who manages money for clients and, harkening back to his sell-side days, offers single stock research to professional investors. Given all of the secular and cyclical factors that have impacted retail companies over the last decade, I was really looking forward to speaking with John about:
- The unique return on capital lens that he approaches brick and mortar companies with;
- How he structures an investment portfolio;
- What people commonly get wrong about retail and restaurant stocks;
- What a retail compounder looks like in the early stages; and
- The lasting impact of the shift to e-comm and of COVID on the retail sector
For more information about Quo Vadis Capital, please visit: https://www.quovadiscapital.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jeff Schwartz, the CEO of Dentity. Jeff has a long track of success and has been the CEO of a number of public companies. Jeff’s newest venture is called Dentity, a company that is attempting to make digital identities ubiquitous across the internet. In this fascinating conversation, we discussed:
- How a self-described “auto guy” got into the digital identity space;
- The business model surrounding creating digital identities for people;
- Why he enjoys building multi-sided markets from scratch;
- The role that AI is going to play when it comes to demand for verifiable digital identities; and
- The benefits of having a decentralized structure rather than one that is centralized
For more information about Dentity, please visit: https://www.dentity.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Clare Flynn Levy, the Founder and CEO of Essentia Analytics. I met Clare several years ago when my prior firm worked with Essentia to help us improve our decision making. The process of having Essentia analyze past successes and mistakes was so insightful that I became a big fan of the product. Accordingly, when I reconnected with Clare recently, I was excited to speak with her about:
- The founding inspiration for Essentia;
- The concepts of Behavioral Alpha and of providing a helpful benchmark to managers;
- Working with both managers and allocators to help improve decision making;
- How Essentia can use all its data to make the software even better over time; and
- Ways in which managers can use Essentia’s data to help market their firms.
For more information about Essentia Analytics, please visit: https://www.essentia-analytics.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Nick King, the co-founder and CEO of Vint. Through Vint, Nick is on a mission to turn wine into a financial asset class. Nick was working on the buy-side at a value investment firm but left to work on Vint full-time in 2021. Since then, the company has gone through a rigorous SEC registration process and is now in position to offer investors the ability to participate in the returns available that come from owning wine. With that as a backdrop, I was eager to talk to Nick about:
- The structural inefficiencies in wine pricing that can lead to attractive returns;
- Where an investment in wine fits within a broader portfolio;
- The different strategies that Vint offers;
- How his experience as a professional investor has impacted the way he manages Vint; and
- Whether or not Vint benefits from being a first mover in the space.
For more information about Vint, please visit: https://vint.co/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Soo Chuen Tan, the Founder and President at Discerene Group. Soo Chuen started the firm over 13 years ago with less than $100mm in assets. Since then, the firm has grown to manage over $2 billion in for clients. Discerene has one of the most compelling structures and relationships with its LPs of any public investing firm I know. I have had the privilege of listening to Soo Chuen speak on other podcasts and I was excited to chat with him on Compounders about:
- How he managed to convince his LPs to provide him with a drawdown structure;
- The hurdle rate for calling capital from LPs;
- Avoiding conformity and the kind of contrarianism that works for Discerene;
- The characteristics of a business that deserves to exist; and
- What attracts him to invest in emerging markets.
For more information about the Discerene Group, please visit: https://www.discerene.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guests on the show today are Corey Henegar and Jeff Fahrenbruch, the co-portfolio managers at Oakview Capital. Oakview is an SEC-registered, Dallas-based investment firm that was started in 2010. Jeff and Corey bring a unique lens into value investing and I enjoyed talking to them about:
- How decisions are made at Oakview given the co-PM structure;
- The types of companies they look to invest in;
- Portfolio construction, including position sizing;
- How they use checklists within their process; and
- Some of the unique metrics they use to determine business quality.
For more information about Oakview Capital Management, please visit: https://www.oakviewcm.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jim Falbe, Managing Principal, Portfolio Manager at Saguaro Capital Management. After spending almost 8 years at Vulcan Value Partners, in 2021 Jim left to start Saguaro. The most unique thing about the Saguaro strategy is that it employs an internally-built AI system that helps with screening for stocks as well as with investment decision making. In this in-depth interview, we covered:
- How Jim’s experiences at Vulcan have shaped his approach to starting Saguaro;
- What the term AI actually means to Jim and Saguaro;
- How the team members use AI now and how they hope to use it in the future;
- Why a SMID-cap strategy was compelling enough to launch with; and
- Why he prefers to invest with companies growing inside of their moats.
For more information about Saguaro Capital Manage, please visit: https://www.saguarocm.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Evan Curtis, the Executive Director of Investments at Vanamor Investments, a private real estate investment firm. Given the ongoing turmoil in the real estate market first caused by COVID and then exacerbated by the sharp rise in interest rates, I was excited to have Evan on as our first real estate-focused, private investor. In this wide-ranging conversation, we discussed:
- The history of Vanamor, including the real estate verticals it has chosen to focus on;
- What Evan has learned about investing through real estate cycles;
- The opportunity set in investing in commercial real estate right now;
- How Vanamor incorporates data and technology within its process; and
- The benefits of running a small, nimble investment firm.
For more information about Vanamor Investments, please visit: https://vanamor.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Josh Collinsworth, the Portfolio Manager at Nomadic Value Partners. Josh started Nomadic in 2019 after spending a number of years as an allocator. Josh is one of the most eclectic investors I know, and his understanding of the byzantine US healthcare system makes him my go-to investor when trying to navigate investments in that industry. In this enlightening conversation, we discussed:
- Josh’s path from being an allocator to starting his own investment firm;
- How he developed an expertise within healthcare;
- Nomadic’s time horizon and how it compares to that of other investors;
- Portfolio concentration and position sizing
For more information about Nomadic Value Partners, please visit: https://nomadicvalue.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Drew Estes, the Portfolio Manager at Banyan Capital, a firm that has been around since the late-1980s. Drew joined Banyan in 2016 and then took control of the business in 2019. Drew has brought his own brand of long-term focus to build permanent wealth for the firm’s clients. In this engaging conversation, we covered:
- The history of Banyan and how Drew came to control the firm;
- Portfolio construction, including concentration and the ideal type of company;
- Drew’s unique perspectives on client communications;
- His affinity for insurance companies, including Berkshire Hathaway’s; and
- How he goes about finding cheap compounders
For more information about Banyan Capital, please visit: https://banyancapital.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Matt Reustle, the CEO of Colossus. For anyone who is not familiar with the platform, Colossus is the home for a number of excellent podcasts, including Invest Like the Best, Founders, The Art of Investing and Business Breakdowns. Given my person experience with podcasts, I was really looking forward to learning from Matt about:
- The economics of podcasting as a business;
- Where the idea for Colossus came from;
- How Matt and his partners decide which new podcasts to add to the platform;
- Where we are in the maturation of the ad market for podcasts; and
- Best practices in partnering with advertisers
For more information about Colossus, please visit: https://www.joincolossus.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jimmy Schwartz, the Co-Founder and CIO of Harvey Partners. Jimmy founded the firm in 2006 with his partner, Jeff Moskowitz. Over the last 17 years, the firm has put up an enviable track record by focusing on stocks that other people neglect, as well as companies that are at an inflection point. In this enjoyable conversation, we covered:
- The types of company-specific situations that get Jimmy excited;
- How the firm sources companies that are at an inflection point;
- How eclectic his portfolio is when it comes to the variety of companies;
- How Harvey Partners has been able to protect downside during market drawdowns
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Aoifinn Devitt, the CIO of Moneta, a wealth management firm with about 30 billion dollars of assets under management. Moneta has been around for over 150 years and has been an RIA since the late-1980s. The firm is 100% partner-owned and has grown to have over 400 employees. In this in-depth conversation, we discussed:
- The general trends that having been driving clients towards RIAs and multi-family offices;
- How Moneta approaches asset allocation for clients;
- How Moneta differentiates itself from other large wealth management firms;
- The use of outside managers versus leveraging internal investment strategies; and
- The unique 25+ team structure of Moneta.
For more information about the Moneta Group, please visit: https://monetagroup.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Brandon Halcott, a true entrepreneur. Brandon founded a company called Tru Family Dental, which was a roll up of dental practices that was sold to a private equity owned dental company a few years ago. Now, Brandon is at it again but this time is focused on building both a dental practice platform and one dedicated to engineering and architectural firms. In this fast moving conversation, we discussed:
- The journey that led to the founding of Tru Family dental;
- The opportunity that still exists to consolidate dental practices;
- What he finds interesting about engineering and architectural firms;
- How Brandon has chosen to fund and finance these companies; and
- How his approach is a little different from that of a typical private equity firm
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Adam Michaels, the Chairman and CEO of Mama’s Creations, a $140 million market cap company that provides products to the deli aisle of large food retailers. Adam became CEO in 2022, after spending about 9 years at the large consumer packaging company, Mondelez. I met Adam at a recent investment conference and wanted to have him on the podcast to discuss:
- Why he decided to take the role as CEO;
- The playbook he has brought from Mondelez and its applicability at Mama’s;
- Why there is such a large opportunity for the company to more deeply penetrate the deli aisle;
- The strategy surrounding further expanding its distribution footprint; and,
- The target financial profile of the company once it starts to hit scale.
For full disclosure, I am not a MAMA shareholder.
For more information about Mama's Creations, please visit: https://mamascreations.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Bo Knudsen, the Managing Director of Global Equities at C Worldwide Asset Management. Many listeners may not be familiar with C Worldwide, but the Denmark-based firm manages over 20 billion dollars. Bo has been a portfolio manager since 1989 and has had his hand in some strategies that have generated incredible outperformance versus their benchmarks over long periods of time. In this insightful conversation, we discussed:
- The characteristics of a typical C Worldwide compounder;
- The investing culture that encourages employees to stay with the firm for decades;
- His history with the company Novo Nordisk, the Danish company that is now well-known for its weight loss drugs;
- How the firm approaches ethical and sustainable investing; and
- The elements that have allowed C Worldwide to generate such meaningful outperformance over time.
For more information about C Worldwide Asset Management, please visit: https://www.cworldwide.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today needs no introduction. Tobias Carlisle, Founder and Managing Director of Acquirers Funds and Co-Host, Value After Hours. He manages two ETFs, a larger-cap deep value ETF with the ticker ZIG—and a smaller cap one with the ticker DEEP. He is the author of several books on value investing and is the co-host of the popular podcast: Value After Hours. You also may know him by his Twitter handle, Greenbackd. In this conversation, which started at a lunch table and continued in the podcast studio, we covered:
- How he blends qualitative and quantitative research to construct his portfolios;
- The methodologies he uses to inform position sizing, rebalancing, and concentration;
- Why he requires the companies he owns to meet certain free cash and balance sheet criteria;
- The rationale for holding a diverse range of markets cap stocks in his ZIG ETF; and
- The difference between looking to be a contrarian and the willingness to be a contrarian.
For more information about Acquirers Funds, please visit: https://acquirersfunds.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jeremy Kokemor, the Founder of Right Tail Capital. After several buyside stints, including at T. Rowe Price, Jeremy founded Right Tail in 2022. Jeremy runs a concentrated portfolio of high-quality companies that just happen to be trading at large discounts to intrinsic value. In this wide-ranging conversation, we discussed:
- Why he decided on the name Right Tail;
- His definition of a quality company;
- What concentration means to Jeremy and how that translates to position sizing;
- The ways in which he has intentionally created alignment between himself and his investors; and
- Stocks that have taught him lessons and served as mentors.
For more information about Right Tail Capital, please visit: https://www.righttailcapital.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Tyler Hardt, the Senior Portfolio Manager at Seagate Capital Management. After spending about 9 years at Artisan Partners, Tyler decided to go out on his own and start his own firm in 2018. Tyler is an unabashed value investor who even wrote a book called, Value Investing: A Disciplined Framework. In this insightful conversation, we discussed:
- The founding story of Seagate Capital and why Tyler felt like he was ready to be an entrepreneur;
- How Tyler finds companies that both have sustainable competitive advantages and trade at reasonable valuations;
- Why he decided to write a book about value investing;
- What he learned about himself as an investor during a very difficult environment in 2020; and
- The guardrails he has put in place to help prevent his strategy from losing money.
For more information about Seagate Capital Management (formerly Pelican Bay Capital Management), please visit: https://pelicanbaycap.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Heather Brilliant, the CEO of publicly traded company, Diamond Hill Investment Group, Inc. (NASDAQ: DHIL). Heather became CEO in 2019 after putting together an enviable resume of experiences at other investment firms. As of the most recent quarter, Diamond Hill had about $26 billion of assets under management, but still considers itself a boutique firm. In this holistic conversation, we discussed:
- Heather’s experience becoming CEO right before the world shut down due to COVID;
- Diamond Hill’s unique capital allocation strategy as relates to returning cash to shareholders;
- How the firm differentiates its strategies despite lots of competitors offering similar products;
- The avenues available for the company to continue to build is AUM base; and
- The concept of building a brand within investment management.
For full disclosure, I am not a Diamond Hill shareholder. For more information about Diamond Hill Investment Group, Inc., please visit: https://www.diamond-hill.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jake Wood, the founder and CEO of Groundswell. Jake is a former Marine who founded a non-profit organization called Team Rubicon, which has over 100,000 volunteers located around the world. Jake stepped back from being Team Rubicon’s CEO in 2021 to start Groundswell, a company that is attempting to transform employee giving through the use of technology. My guess is that most people haven’t thought deeply about the nuances of employee giving or are familiar with what are known as Donor Advised Funds. But, when I had a chance to use the Groundswell product, I immediately wanted to have Jake on the podcast to discuss what he and his team are building.
Specifically, we covered:
- The founding story of Groundswell;
- Donor Advised Funds and some of the issues associated with legacy offerings;
- The idea of everyone having their own personal foundation;
- The ways in which Groundswell makes money; and
- What Jake hopes the business will look like in 5 years.
For more information about Groundswell, please visit: https://groundswell.io/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Joseph Shaposhnik, the portfolio manager of the TCW New Americas Premier Equities Fund. Joseph began managing the fund in 2015 and since then has assembled a concentrated portfolio of mostly US mid-to-large-cap stocks. Morningstar currently has a 4-star rating on the fund, which consists of a collection of high quality, recurring revenue businesses. In this conversation, we covered:
- Why predictability of cash flows is so important to Joseph;
- The rationale for having a heavy weighting in Constellation Software;
- What he has learned about assessing management through his relationship with successful CEOs;
- Why all recurring revenue businesses are not created equally; and
- Why a company like Meta doesn’t make the cut to be in his portfolio
For more information about Joseph Shaposhnik and TCW Group, please visit: https://www.tcw.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Today’s episode is another in our series of interviews with emerging investment managers where we discuss how to build an investment firm that can compound. My guest on this show is Aaron Wasserman, a Partner at Third Period Capital. After a long and successful tenure at Baron Capital, in 2019 Aaron started Third Period, a long-only, global growth firm based in Los Angeles. Aaron believes he has cultivated an edge in identifying and owning companies with exceptional cultures—and he has engaged Wharton Professor and best-selling author Adam Grant to help widen his competitive advantage.
In this discussion, we covered:
- How to analyze company cultures and determine if they are additive to growth;
- What Aaron learned from working with Ron Baron for many years;
- What Adam Grant’s involvement brings to Third Period and to Aaron’s process;
- An example of a prototypical “Aaron stock” and
- The sectors that Aaron has chosen to focus on in this strategy
For more information about Third Period Capital, please visit: https://www.thirdperiodcapital.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Sean Stannard-Stockton, the President and CIO of Ensemble Capital, an investment and wealth management firm that has built up quite a following on social media as a result of its consistent output of thoughtful content. Sean and his team of analysts manage over a billion dollars in equities, consisting of a concentrated portfolio of super high-quality businesses. The team has developed a rigorous competitive advantage assessment process that is designed to identify only those companies with durable moats.
In this wide-ranging conversation, Sean and I discuss:
- How Ensemble employs its competitive advantage framework when construction a portfolio;
- The benefits of having a wealth management arm alongside an investment management business;
- The rationale for creating and sharing so much thoughtful content on Twitter and the firm’s blog;
- His personal definition of a compounder; and
- What harmony and disharmony look like within an investment process
For more information about Ensemble Capital, please visit: https://ensemblecapital.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Today’s episode is the next in our series of profiles of emerging investment firms. In these interviews, we dive deep into the various components of building an investment firm that can compound. Our guest on the show today is Greg Dean, the Founder and Lead of Investor at Toronto-based Langdon Equity Partners. Greg founded Langdon in 2021 after successful stints at Fidelity and Cambridge Global Asset Management. Langdon describes itself as an “active and engaged owner of world class smaller companies.” The firm has assembled concentrated portfolios of companies with enterprise values between $500 million and $5 billion that are cash generative and are run by long-term-oriented executives.
In this conversation, we discuss:
- Why Greg wants the Langdon office to be more like a library than a train station;
- His definition of a compounder and the unique challenges of managing such companies within small cap strategies;
- How Langdon has tried to position itself differently from other small-cap-focused firms;
- The kinds of mistakes that prevent companies from realizing their full compounder potential; and
- The cultural elements that are most important when building a new investment firm.
Without any further ado, here is my conversation with Greg Dean of Langdon Equity Partners. For more information about Langdon Equity Partners, please visit: https://www.langdonpartners.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guests on the show to today are Heather Beatty and Robin Kollannur, the respective founder and Portfolio Manager of ScopeFour Capital. After a number of years working in business development at large investment firms, Heather started ScopeFour, a climate impact-focused firm, to take advantage of the investment opportunities associated with companies that are building impactful climate solutions. Robin has 30 years of experience in money management and has recently joined the firm to implement the ScopeFour process and vision.
In this extensive conversation, we discussed:
- The founding of ScopeFour and the investing opportunity set;
- The difference between investing for impact versus what has come to be known ESG;
- The intersection between a company that compounds over time and one that is making a positive impact on the climate;
- How Robin and Heather narrow down the universe of companies; and
- How to avoid paying too high a price for the companies that are likely to have the most positive impact.
Without any further ado, here is my conversation with Heather Beatty and Robin Kollannur of ScopeFour Capital. For more information about ScopeFour Capital, please visit: https://www.scopefourcapital.com/
Listen to all Compounders Podcast episodes on either Apple or Spotify
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of SNN or its affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Thomas Li, the co-founder and CEO of financial data company Daloopa. Daloopa is a private company that was founded by a group of former buy-side investment analysts who saw the opportunity to use technology to upgrade the research process at just about any type of investment firm; but with a specific focus on saving analysts and portfolio managers time. Just a few years into its journey, the company already has over 200 employees and has multiple offices around the world.
In this wide-ranging interview, Thomas and I discussed:
- Where the original idea for Daloopa came from;
- How he views the legacy data providers such as CapitalIQ and Bloomberg;
- What Daloopa is doing to make the product a must-have versus a nice-to-have;
- What AI means within the context of Daloopa; and
- The importance of building a company that naturally generates a lot of cash
As a disclaimer, Daloopa is a sponsor of the Compounders podcast. Cove Street nor Ben Claremon are shareholders of Daloopa.
Without any further ado, here is my conversation with Daloopa CEO Thomas Li. For more information about Daloopa, please visit: https://daloopa.com/
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Daloopa. Daloopa was founded by a former hedge fund analyst to bring simplicity to the investment process. Daloopa offers an AI-driven, single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time. For more information, please visit: https://daloopa.com/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guest on the show this week was Aaron Graft, the Founder, Vice Chairman and CEO of Triumph Financial. Just as the impacts of the Great Financial Crisis were waning, Aaron led a team of people who took over a failed bank to create Triumph. Aaron has been CEO since the beginning and has been instrumental in transforming the bank into a transportation-focused industry leader. Specifically, Aaron has helped turn what was a small factoring business into a high margin one that buys $1 billion in invoices from truckers every month. In recent years, Aaron has turned his focus to building a payments company that caters to all of the constituents in the trucking industry. In this fascinating discussion, we covered:
- The benefits of having a bank structure despite Triumph not being a typical community bank;
- How the company has built the factoring business over time and why it is so profitable;
- The vision for Triumph Pay and the path to building it into something much larger; and
- Why the company has been so aggressive in repurchasing its own shares
For full disclosure, Cove Street is NOT a Triumph Financial shareholder.
And without any further ado, here is my conversation with Triumph’s Founder, Vice Chairman and CEO, Aaron Graft. For more information about Triumph Financial, please visit: https://www.tfin.com/
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Daloopa. Daloopa was founded by a former hedge fund analyst to bring simplicity to the investment process. Daloopa offers an AI-driven, single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time. For more information, please visit: https://daloopa.com/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guest on the show today is Craig Packer, the CEO of Owl Rock Capital Corp, a 5.4 billion dollar market cap business development company that invests in middle market companies in the US. Craig is also the Chief Investment Officer of Owl Rock Capital, a New York-based direct lending platform with over 50 billion dollars of assets under management. This is the first business development company—or BDC for short—we have had on the podcast, so we wanted to make sure that we spent some time talking about BDCs in general and why Craig thinks they are an attractive niche within public markets. Additionally, in the discussion with Craig, we covered:
- What metrics investors should focus on when they are considering investing in a BDC;
- Owl Rock Capital’s investment philosophy and risk management strategies;
- How Craig would expect the BDC’s portfolio to perform in an economic downturn;
- What kind of investment opportunities Craig and his team are seeing at the moment; and
- The proper use of leverage within a BDC structure
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Brian Lane, the President and CEO of Comfort Systems, a 3.6 billion dollar market cap company that provides mechanical and electrical services, including installation, repair and maintenance, to customers in the US. Brian became CEO in 2011 and over the last 11 years, has overseen very impressive revenue growth and stock performance. The company has consistently made acquisitions over the last decade but still has a ton of white space left domestically. Given Comfort Systems’ track record and runway for future growth, it was great to talk with Brian about:
- The company’s acquisition philosophy and what it adds to the companies it acquires;
- How the company is approaching a potential recessionary period in the US;
- The process by which Comfort Systems has built up a recurring revenue base;
- The structure of the industry from a competitive perspective; and
- How the company is overcoming both inflationary and labor availability challenges.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guest on the show today is Steve Daly, the CEO of Instructure Holdings, a 3.6 billion dollar educational software company. After serving on the Board of the company, Steve became the CEO in late 2020, right in the middle of pivotal time for the company. Instructure’s core products consist of cloud-based learning management systems used by higher education and K through 12 schools all around the world. Listeners may not be familiar with Instructure, but the Canvas brand is likely something many people have heard of or even used.
In 2020, the COVID outbreak presented all kinds of challenges for schools, especially when it came to figuring out how to use technology to continue the education process in a remote environment. Given how well Instructure is positioned to help schools embrace new technologies, I was excited to hear from Steve about:
- How the outbreak of COVID impacted the demand for learning management systems in both higher ed and K through 12;
- Why cloud systems are better than on premise systems and how that leads to very low churn among customers;
- Penetration rates of learning management systems across end markets and the different strategies Instructure employs to grow;
- How the company went from being quite unprofitable to generating very attractive margins in a short period of time; and
- How Thoma Bravo’s Orlando Bravo convinced Steve to join the Board of Instructure and eventually become the CEO.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guests on the show today are Scott King and Jeff Gorman, the CEO and Executive Chairman of The Gorman-Rupp Company, a 700 million dollar market cap company that designs, manufactures, and sells pumps and pump systems to customers all over the world. 2022 has been quite an eventful for year for the company. Earlier in the year, Jeff Gorman stepped back to Chairman, allowing Scott to become the CEO, despite not having the Gorman last name. The company also completed a very large acquisition of a company called Fill-Rite. Given those events and all of the other challenges in the world today, I was excited to speak with Scott and Jeff about:
- The timing of the management transition and the expectation that Scott continue the company’s long history of dividend increases
- The rationale for the Fill-Rite deal and why now was the right time to take a big swing—with some leverage;
- The importance of culture and the family-like values that have persisted over the last 90 years;
- Where the company is investing in technology and innovation; and
- How the company approaches tough economics times given all of the different crises the company has weathered during its long history
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable..
My guest on the show today is Chris Mayer, the Portfolio Manager of the Woodlock House Family Capital fund and the co-founder of the firm. He is also the author of 100 Baggers: Stocks That Return 100-to-1 and How To Find Them. You will notice that we are doing something a little different with this episode. Chris is our first guest who is not an executive at a public company. But, since this podcast is called Compounders: The Anatomy of a Multibagger, we thought it would be great to have on the guy who literally wrote the book on finding 100-baggers. In this wide-ranging interview, Chris and I discussed:
- The common attributes of 100-baggers Chris found in his study of compounders;
- The biases that make it hard for investors to realize a 100-bagger;
- Why individual investors might be more likely than are institutional investors to get the full benefit of decades of compounding;
- Where serial acquirers fit within the 100-bagger paradigm; and
- Why high incremental returns on capital are so important to long-term success
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guests on the show today are Malcolm Wilson and Mark Manduca, the respective CEO and CIO of GXO Logistics. GXO is a 7-billion dollar market cap company that provides logistics services to companies around the world. The company was recently spun off from XPO Logistics and now has the freedom to invest aggressively to helps its customers with supply chain and warehouse automation. COVID, supply chain disruptions and rising labor rates around the world have made many companies start to think deeply about their supply chains and to consider outsourcing and automation. As such, given how well GXO would appear to be positioned for the future, I was really looking forward to talking to Malcolm and Mark about:
- The rationale for the spin and what having more autonomy will allow GXO to do;
- The structural tailwinds that are behind the company as it relates to e-commerce, outsourcing and warehouse automation;
- Why GXO is definitely not a commoditized warehouse company;
- Why the company is a buying Clipper; and
- The importance of return on capital when it comes to capital allocation
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Casey Hoyt, the CEO of Viemed. Viemed is a 196 million dollar market cap company that provides in-home durable medical equipment (DME) and post-acute respiratory healthcare services to patients in the United States. The company has developed a specialty in providing non-invasive ventilation to patients with chronic obstructive pulmonary disease or COPD. Casey took over as CEO in 2017 and has helped the company grow its revenue meaningfully over that time, even accounting for the COVID headwinds the company has seen over the last few years. Given Viemed’s impressive recent track record and the amount of white space it has to continue to serve even more at-risk patients, I was looking forward to talking to Casesy about:
- The elements that have led to such rapid revenue growth;
- The attractiveness of in-home care relative to acute and outpatient case;
- The size of the COPD population in the U.S. and how Viemed can increases the penetration of non-invasive ventilation;
- How the company is attracting and retaining talented people in a very tight labor market for healthcare workers; and
- How the company thinks about adding new products and services to its current offerings.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guest on the show today is Tom Logan, the CEO of Mirion Technologies. Mirion was founded in 2005 and Tom has been the company’s only CEO over that period of time. Mirion is a global leader in radiation measurement, serving end markets such as nuclear, life sciences, healthcare and industrial. Mirion recently became publicly traded via a SPAC, but unlike many other de-SPACed companies, Mirion has a long operating history and generates positive EBITDA. The company has had to weather a number of headwinds over Tom’s tenure, including the Great Financial Crisis, the Fukushima nuclear disaster in Japan, and of course COVID. Despite that, the company has grown consistently through organic and inorganic means and expanded its margins meaningfully. With all of that as a backdrop, I was excited to talk to Tom about:
- The current state of the base of nuclear power plants around the world and how the Russia-Ukraine conflict is impacting nuclear policy;
- How the company is positioning itself to grow within the medical end market;
- What he has learned from Mirion Chairman Larry Kingsley, who achieved tremendous success as CEO of IDEX and Pall Corp.;
- The elements of the business model that lead to sticky, recurring revenue; and
- How the company hopes to achieve its mid-single digit growth algorithm
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Welcome to what I will call an update episode of Compounders. We are done with our executive interviews for Season 2. However, we are in the process of putting together a Season 2 recap show—similar to what we did for Season 1. Overall, we had a very eclectic mix of guest with some larger company CEOs and some smaller company CEOs. But the quality of the interview was really good in my humble opinion. The Joey Levin episode got the most engagement we have received for an interview. I think a lot of people discovered Compounders through that episode. Thanks for listening to this Season and we hope you will stick around for what we have in store.
Going forward, the structure is going to change a little bit. During the first 2 seasons, we tried to put out an episode each week for 12 weeks. Given the busy schedules of public company execs and the demands associated with quarterly earnings, this has created unnecessary pressure and scheduling complexity. So, instead of doing 12 episodes and taking a month off, we are going to book and release episodes on a consistent but not necessarily weekly basis. Our focus right now is on getting great guests who run interesting companies.
We ran a Twitter poll and over 90% of people said they don’t care about seasons—they just want us to find great guests. We hope you will continue to follow Compounders and check your podcast feed regularly for new episodes. Bobby and I have a list of about 50 companies we are going to be reaching out to over the next few weeks. There are a number of true compounders on that list.
A lot of these companies came from suggestions from listeners. Thanks to everyone who has reached out with some recommendations. However, we are always looking for new guests. So, please feel free to reach out. As always, warm introductions are much appreciated. I am pleased to say that our brand has grown to the degree that cold outreach has started to pay dividends. However, we have found companies to be very receptive when we are introduced by shareholders. We are excited about the momentum we have built since August and I personally am looking forward to bringing you interviews with compelling guests in a variety of industries and hopefully from a number of countries.
Thanks again for listening and feel free to reach me at podcast@covestreetcapital.com or follow me on Twitter @benclaremon. Please stay tuned for the next interview of Compounders, to be released in the next several weeks. This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guest on the show today is Eric Ellenbogen, the CEO and Vice Chairman of WildBrain. WildBrain is a 500 million Canadian dollar market cap entertainment company listed on the TSX in Canada. The company operates through two segments, Content Business and Canadian Television Broadcasting, and through those develops, produces, and distributes films and television programs worldwide. WildBrain’s intellectual property includes well known characters such as Snoopy, Strawberry Shortcake and Inspector Gadget.
Eric became CEO during the summer of 2019, after being the Co-President of Classic Media at DreamWorks and having served as the CEO of Marvel before it was acquired by Disney. Given Eric’s vast experience in the media content production industry, I was very much looking forward to talking to Eric about:
- WildBrain’s preferred business model, especially as it relates to holding onto IP versus simply selling shows to third parties;
- The opportunities for growth in the company’s Peanuts franchise;
- What he has learned by watching Disney expand the Marvel franchise that he can replicate at WildBrain;
- The strategy behind taking a hit show or popular character and turning those into consumer products revenue; and
- His thoughts on the high valuations studios have been receiving in recent deals.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our returning guest on the show today is Mark Dankberg, the co-founder and Executive Chairman of Viasat. Viasat is a 3.1 billion dollar market cap company that provides broadband and communication products and services worldwide. Viasat started off a defense-oriented company but has since layered on consumer and business-facing offerings by developing the world’s leading high throughput geostationary satellites.
Subsequent to our first interview with Mark, Viasat announced its intent to merge with Inmarsat, a UK-based company that provides mobile satellite communications services on land, at sea, and in the air worldwide. Without question, the size and the timing of the deal was a surprise to many of the people in the industry, especially because Viasat was in the middle of preparing to launch 3 new satellites over a short period of time. Given all of that, I was very curious to hear from Mark:
- Why Viasat decided to acquire Inmarsat versus other potential targets;
- Why Viasat is the right owner of Inmarsat versus other potential buyers;
- Why do the deal now versus waiting until the 3 new satellites had been launched;
- How Inmarsat fits into Viasat’s hybrid network philosophy; and
- How Viasat plans to integrate Inmarsat employees culturally.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
This week, we are replaying another one of our favorite episodes from Season 1. The reason is that we are about have the same guest on again to discuss a transformational merger the company announced after we released our interview. So, over the next two weeks we will have back-to-back episodes with Viasat’s Co-Founder and Executive Chairman, Mark Dankberg.
In the episode from last Season, Mark and I discussed the nuances of the very dynamic satellite broadband industry, including why satellite broadband is not likely to be a winner-take-all market as well as the value of having a hybrid network of satellites at different orbits. In our second interview, Mark and I will talk about the rationale for the merger with Inmarsat and how the deal changes Viasat’s long-term trajectory. So, please stay tuned for a multi-episode deep dive into the future of space communications.
EPISODE:
My guest on the show today is Mark Dankberg, the co-founder and Executive Chairman of Viasat. Viasat is a 3.8 billion dollar market cap company that provides broadband and communication products and services worldwide. Viasat started off a defense-oriented company but has since layered on consumer and business-facing offerings by developing the world’s leading high throughput geostationary satellites.
Over the next 2 years, Viasat will be launching 3 new satellites that will give the company the ability to offer global coverage to its military and in-flight WIFI customers. Additionally, Viasat is rolling out community WIFI initiatives to help people in emerging and frontier markets connect to the internet for the first time. All of this is happening while the company is facing a growing threat from low earth orbit satellite providers such as Elon Musk’s Starlink.
Given how much is going on and the fact that Mark recently went from being the CEO to assume the Executive Chairman role, I thought it would be a perfect time to talk to him about the following topics:
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The future of the global satellite broadband industry, including competition with Starlink;
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What the US military needs now from Viasat and how that may evolve over time;
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The cultural differences between the defense and commercial sides of the company;
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How Viasat can benefit from all the space-related activity going on right now; and
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Why this was the right time to shift his focus
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Key takeaways:
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Deeply understanding your customers’ wants and needs is a prerequisite for success in both D2C and B2B business. But, the more intermediaries you have, the less you can really understand your end customers. Also, working with distribution partners can be difficult if the goals of the organizations are not aligned.
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Not every industry is a winner-take-all market. Network effects and multisided marketplaces can create virtuous cycles and winner-take-all markets. In industries with supply constraints, negative network effects drive competition and ensure a diverse set of offerings.
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Bandwidth demand is heavily affected by geography and low-earth-orbit (LEO) networks are geographically limited. Despite offering low latency, every incremental satellite will only spend a fraction of its time over the areas with the most demand, and far more over oceans and other low demand areas. This is why a hybrid network that includes geostationary and LEO satellites is likely the best solution for customers.
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When a company is entering new markets or introducing new products, it is imperative to be a voracious reader of business history and theory, as well as to be well-grounded in the basic math that governs the industry.
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Modern warfare requires real-time information and instant communication. Accordingly, the U.S. military will need an up-to-date network of satellites with ground stations placed in safe locations in order to process and anticipate the moves of its adversaries.
Timestamps:
1:18 - Introduction
2:56 - Diversifying into direct-to-consumer (D2C) with the 2009 WildBlue acquisition
5:06 - The organizational restructuring required when shifting towards D2C
7:06 - Building a D2C sales organization within a legacy B2B company
11:51 - Making stair-step improvements with every new satellite launch
18:50 - The process of deciding to build Viasat’s own satellite
27:30 - Satellite broadband is not a winner-take-all market
31:32 - LEOs, GEOs, hybrid networks and why there is no “best” satellite design
45:27 - Building a cohesive culture with two distinctly different business segments
51:23 - Why Viasat 3 will play a key role in the future of warfare
58:25 - How Viasat benefits from all of the excitement around space
62:40 - What Mark has learned from Baupost Group’s founder Seth Klarman
65:53 - Being confident in putting out guidance even before the Viasat 3 satellites launch
70:55 - The least understood aspects of Viasat
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Our guest on the show today is Ramesh Srinivasan, the CEO of Agilysys. Agilysys is a 900 million dollar market cap company that provides software and hardware products and services to the hospitality industry. Ramesh became CEO back in 2017, after a somewhat rocky turnaround attempt by a prior management team. Agilysys was starting to generate higher gross margins and revenue growth before the COVID outbreak impacted its trajectory, starting in the company’s fiscal year 2021. Given the recent challenges and with everything going on in the hospitality industry, I was eager to talk with Ramesh about:
- The organic growth path he sees for the company in upcoming years;
- How the company manages the desire to grow with the need to generate operate profits;
- The ways in which Agilysys helped its customers respond to COVID-related issues;
- His thoughts on M&A and expanding the company’s presence outside the US, and
- The benefits and challenges associated with rolling out cloud native software-as-a-service products
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
This week, we are replaying one of favorite episodes from Season 1. Due to the complexities that come with the upcoming Q4 earning reporting season, we needed to take a week off between new episodes. However, we will return the week after with a new interview with the CEO of an $800 million dollar market cap software company. Tom Gayner is the Co-CEO of Markel Corporation and the wisdom he shares on life and on investing is always eye opening and valuable. We interviewed Tom in August of last year for Episode 2 of Season 1. The Compounders audience has built since August and many of our newer listeners may not even be aware of the Gayner interview. So, whether you have had a chance to listen to the interview or not, we hope you enjoy it.
EPISODE:
My guest on the show today is Tom Gayner, the co-CEO of Markel Corporation. Markel is a Fortune 500, $16.7 billion market cap financial holding company that primarily operates in the insurance and re-insurance industry. Though Tom has only been in the co-CEO seat since 2016, he has been with Markel for close to 30 years and he has been an investor longer than that. Markel has been compared to Berkshire Hathaway in both structure and performance and Tom has been a key architect of the company’s diversification away from insurance through the acquisition of operating businesses. In fact, Markel Ventures has gone from $1.2 billion in revenue in 2016 to about $2.8 billion today.
Tom is well-known in the value investing community for his charm and intellect. Also, many people who have made the trek to Omaha for the Berkshire Shareholder Meeting have also attended the Markel Breakfast event. I had the opportunity to listen Tom speak a number of times in Omaha and that is why I thought he would be a great guest on the podcast. In this conversation, we will cover:
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His thoughts on what makes a compounder
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How to invest more like a grandmother than a Wall Street trader
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And why he is a better investor because he is a CEO—and vice versa
Click the timestamp to jump to each answer:
1:38 - Introduction
3:07 - The 2008-09 financial crisis and Markel’s response
7:55 - The benefits of a legacy of family ownership
11:39 - Comparing today’s market to that of 1998-99
15:53 - The benefits of investing like a grandmother
18:18 - How being a Co-CEO has made Tom a better investor
24:09 - How to tell if a person is a good cultural fit
28:35 - Building culture by articulating what your company stands for
32:15 - Bottom up and top down approaches to compounding
35:39 - Applying the Colfax Business System at Markel
38:08 - Some challenges of working within a family-controlled business
42:03 - Markel’s willingness to invest today for future benefit
48:45 - How Markel Ventures helps diversify the company
51:53 - Why culture is a big part of the moat around Markel’s insurance operations
55:14 - The emergence of ESG and embedding Quaker values
62:30 - Tom’s ideal legacy within Markel
63:50 - Learning from your mistakes to become more adaptable
66:14 - Starting with principals and then learning by doing
69:15 - The most under appreciated aspects of Markel
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Joey Levin, CEO if IAC/Interactivecorp. IAC is a $12.4 billion market cap holding company that has a long history of investing in disruptive digital businesses, helping them grow, and then spinning them off to shareholders. In fact, the company’s Chairman, Barry Diller, has been influential in the success of a number of well-known public companies, including Expedia, TripAdvisor and LiveNation. In more recent times, the company has separated from Match Group and spun off Vimeo. Joey Levin has been CEO since 2015 and is tasked with creating value with the remaining group of businesses that IAC either controls or has minority stakes in. With that as the backdrop, I was excited to talk to Joey about:
- Spinning off Match, which now has a $35 billion market cap, during the tumultuous summer of 2020;
- What needs to go right with ANGI for the stock to be a good investment from here;
- The investment process and how IAC decides which opportunities to pursue;
- The merit of the DotDash acquisition of Meredith;
- How Joey decides on which companies to spend his time
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jennifer Twiner McCarron, the CEO of Thunderbird Entertainment Group (TSX-V: TBRD) (OTCQX: THBRF). Thunderbird is a 220 million Canadian dollar market cap company listed on the TSXV in Canada. The company develops, produces and distributes film and TV programs for customers such as Hulu, Disney and Netflix. Jennifer started off as the Head of Production of Atomic Cartoons, Thunderbird’s animation division, and became CEO in 2018. Since Jennifer joined the company in 2011, the content world has changed dramatically, mainly due to the proliferation of streaming services. Given the dynamic nature of the content production industry, I was curious to hear from Jennifer about:
- How the company is positioned to continue to provide content to the large streaming companies;
- Her thoughts on the high valuations other smaller studios have been selling for recently;
- What the company plans to do with the cash it generates;
- The distinct elements of the Thunderbird culture; and
- The factors that have allowed for the stock to perform so well over the last few years
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on today’s show is Daniel Harari, the Chairman and CEO of Lectra. Lectra is a 1.5 billion Euro market cap company based in Paris, France. Lectra provides software, automated cutting equipment, and other services that enable customers to automate and optimize the design, development, and manufacturing of many different products. Specifically, the company has built a leading position in the automotive, fashion and furniture categories. Daniel has been the CEO of Lectra since 2002 and has overseen a significant amount of revenue and EBITDA growth during his tenure. Given the company’s track record, I was very interested to hear from Daniel about:
- His background and how he got involved with Lectra;
- The company’s move to more of a Software-as-a-Service or SaaS business model;
- The rationale for recently making Lectra’s largest acquisition ever;
- Business model elements that allow for high gross margins and customer retention;
- How the company’s culture has evolved over time
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Stan Bergman, the Chairman and CEO of Henry Schein. Henry Schein is a Fortune 500, 10.6 billion dollar market cap, global distributor of medical and dental supplies and equipment. Stan has been CEO since 1989 and actually took the company public in 1995 for a split adjusted price of $6. From a revenue base of around 1 billion dollars in 1995, the company has grown to over $12 billion today and the stock price has appreciated to over $75. And, these numbers don’t even include the animal health business that was spun off in 2018. That company, Covetrus, currently has a 2.4 billion market cap on its own. Given Stan’s long track record of success, I was looking forward to talking to Stan about:
- The importance of dental health as a component of overall health;
- The company’s long-term track record of compounding earnings per share;
- Why the medical division has seen such rapid growth;
- The company’s international growth strategy and associated opportunities;
- Henry Schein’s unique culture
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Bruce Young, the CEO or Concrete Pumping. The company has a 485 million dollar market cap and is the largest domestic player in a niche of construction-related services that is called concrete pumping. Bruce became CEO of the company back in 2008 but started his career in this industry way back in the 1980s. Concrete Pumping provides a high margin, mission critical service to its construction partners and has the ability to deploy capital at attractive multiples as it helps the industry consolidate further. Given that Concrete Pumping is rather new to public markets, I was very curious to hear from Bruce about:
- How the company generates such high margins and recognizes very high returns on incremental investments;
- The ongoing roll-up opportunity the company has—as well as avenues for organic growth;
- The capital allocation process the company employs when deciding between M&A and adding new equipment
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Robert Bryant, the CEO of Axalta Coating Systems. Axalta is a 7.6 billion dollar market cap company that manufactures and distributes high performance coatings that go into the industrial, automotive and refinish end markets. The company was originally a division of DuPont that was founded in 1866 but was carved out by private equity firm Carlyle—and then taken public in 2014. Axalta is the global leader in providing coatings to auto body repair shops and is a top 3 supplier to auto OEMs. The COVID-induced lockdowns and the subsequent supply chain issues—not to mention the ongoing semiconductor shortage that is plaguing the car companies—have presented a number of challenges to the company. Given the dynamic backdrop and the recovery the company is seeing in certain markets, I thought it would be an opportune time to catch up with Robert about:
- The evolution of the company since going public in 2014;
- The long-term growth opportunities within the global refinish market;
- What it was like to have Berkshire Hathaway as the company’s top shareholder;
- How the company is navigating rapid raw material inflation and shortages
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Peter Holt, the CEO of The Joint Corp. The Joint is a 1.4 billion dollar market cap company that operates and franchises a chain of chiropractic offices. The company currently has over 600 total locations in about 35 states. Peter took the reins as CEO of The Joint in 2016 and has overseen a stock that has appreciate from under $3 in 2016 to over $90 today. In fact, the company was distinctly unprofitable when Peter became CEO but has since started generating very healthy margins with limited capital expenditures. Given all of the recent success, I was excited to talk with Peter about:
- The demand drivers that have been propelling the company over the last five years;
- The elements that have allowed the stock to appreciate so rapidly in recent times;
- How the company tries to distinguish itself from competitors and build a moat;
- How he goes about making sure the company doesn’t grow too fast; and
- How Peter thinks about creating win-win relationships with franchisees.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Ben Gliklich, the CEO of Element Solutions (Ticker: ESI), a 5.5 billion dollar market cap specialty chemicals company. Element Solutions was formerly known as Platform Specialty Chemicals and was founded by Martin Franklin of Jarden fame—with the help of Bill Ackman from Pershing Square. The company was designed to be a roll-up but, after some initial success, it was derailed by an over-levered balance sheet. Ben became CEO in 2019 and since then has overseen a process by which Element has reduced business complexity, fixed its balance sheet, and has proven out its claims regarding its resilient margin structure.
Given that the company provides products that facilitate the fabrication of semiconductors, Element has a front row seat when it comes to all of the issues regarding the global chip shortage. Accordingly, I thought it would be a great time to talk to Ben about:
- His path to becoming CEO and what he has learned about leadership along the way;
- How the company is navigating all of the customer disruption tied to chip shortage;
- The megatrends that are poised to propel the business over the next decade;
- How the company is approaching M&A and leverage after the initial stumbles at Platform Specialty; and
- From where Element Solutions derives it moat and pricing power
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
During Season 1 of Compounders, we interviewed 12 public company executives from a variety of industries. The companies profiled ranged from two Fortune 500 insurance companies to a sub-$500 million market cap supplier to the medical device industry. In this episode, we discuss some of the key lessons and learnings from Season 1 by selecting our favorite vignettes from each episode. We also give a sneak preview of what is lining up to be an even better Season 2 of Compounders.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jeff Bailly, the Chairman and CEO of UFP Technologies. UFP is a 480 million dollar market cap company that specializes in designing foams, films, and plastics materials for the medical, automotive, consumer, and aerospace markets in the United States. Jeff joined the company in 1988 and became CEO in 1995.
Jeff has been instrumental in helping turn UFP into the company it is today. After years of somewhat limited growth, UFP made its largest acquisition ever in 2018—of a company called Dielectrics--and that deal has transformed the company’s margin profile and growth trajectory. And the big changes that have occurred since the deal have not gone unnoticed by the stock market. Accordingly, I thought it would be really instructive to hear from Jeff about the process that led to UFP’s recent success.
In this enlightening discussion, we will cover:
-
The genesis of the Dieletrics deal and the strategy surrounding moving into medical end markets
-
Jeff’s thoughts on the key elements that have allowed the stock to appreciate to a level 20 times its value when Jeff became CEO
-
The benefit of being patient and having a willingness to suffer as CEO
-
Areas in which UFP still has a long runway to get better
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Adam Symson, the CEO of E.W. Scripps. Scripps is a 1.45 billion dollar market cap company that owns and operates local and national television stations. The company was founded in 1878 and over the years has operated within a number of different media businesses. The company spun off its cable TV business, Scripps Networks Interactive, in 2008 and then exited the newspaper business in 2015. These transactions served to focus the company more on its local TV business.
However, since becoming CEO in 2017, Adam has led an aggressive acquisition campaign that has created a large and differentiated National Media segment whose stations mainly operate over-the-air. The Scripps management team anticipated that cable TV subscribers would continue to cut the cord and through these acquisitions has positioned the company to benefit as more people choose to watch TV via an antenna.
Given all of the M&A activity and the dynamic nature of the pay-TV environment, I was excited to talk to Adam about:
-
How competition from digital ad platforms like Facebook are impacting local TV advertising;
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The value of having a background in investigative journalism;
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The rationale for the pace of acquisitions that have occurred during his tenure;
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What it is like to work for a 100+ year old, family-controlled company; and
-
How Scripps develops win-win relationships with its various stakeholders
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Time stamps:
-
1:18 Introduction
-
2:54 The rise of social media advertising and its effects on paid TV media
-
5:20 The state of the local broadcast TV industry in 2021
-
7:10 Building a resilient culture in a volatile industry
-
9:39 The company ethos that comes from developing a $15 billion asset
-
11:29 Suffering short-term pain for a long-term gain in the podcast space
-
15:29 Capital allocation strategy in the media industry
-
18:55 How Scripps employs value investing as a media company
-
22:28 The logic behind acquiring the Katz network
-
26:13 Taking a big M&A swing during a global pandemic
-
33:15 Investing with Berkshire Hathaway as a partner
-
35:45 Creating win-win partnerships with various industry constituents
-
38:48 Navigating the unbundling movement as a media company
-
44:13 Balancing OTA and cable viewing within the same company
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47:34 Investor concerns regarding the traditional media industry
-
49:49 The sports rights battlefield and the future of sports on broadcast TV
-
53:54 Why regulation in media needs to evolve
-
57:38 From investigative journalist to public company CEO
-
60:09 Assessing employee fit in a competitive job market
-
61:22 How Scripps wins over the next 5 years
-
62:51 Mistakes made over the first 4 years as CEO
-
64:34 ATSC 3.0 and the technological evolution of broadcast TV
-
66:38 Preparing for the future of broadcast TV
-
67:11 The most misunderstood aspects of Scripps
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Brian Recatto. Brian is the CEO of Heritage-Crystal Clean, a 670 million dollar market cap company that provides cleaning and waste removal services to customers in the US. HCCI is one of the key competitors to Clean Harbors, a company whose CEO we also interviewed on this show. Specifically, Heritage operates in 2 segments: an Environmental Service division that offers parts cleaning and containerized waste management services; and an Oil Business segment that collects, re-refines and then re-sells used motor oil.
Brian took over the CEO role in 2017 and, aside from a brief COVID-related speed bump in 2020, he has overseen consistently improving results and a higher stock price. COVID presented—and continues to present—a number of challenges for Heritage but the company’s strong balance sheet and consistent Environmental Services businesses have allowed it to weather the storm. With that as a backdrop, Brian and I had a great discussion about:
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How the company has navigated the challenging customer disruptions over the last 18 months;
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The ups and downs associated with owning and operating an oil re-refinery;
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The future of hazardous waste regulation and why HCCI is one of the good guys when it comes to environmental matters;
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The benefits of operating dense route networks and how Heritage defends its market position; and
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How the company approaches M&A and the prospect of adding a third leg to the company’s stool
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Time stamps:
-
1:18 Introduction
-
3:00 Navigating COVID-19 as a waste services company
-
8:52 Why Heritage highlights individual employees on its investor relations website
-
10:45 Creating lines of communication between senior management and field employees
-
11:56 How the rise of electric vehicles will impact HCCI
-
16:19 Evolving a waste services business as customers become more ESG-focused
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18:13 How to tell what is a great ESG story
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21:37 Growing an underappreciated parts washing business
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23:34 Approaching win-win relationships with regulators
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27:25 The logic behind creating a more vertically integrated business model
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31:27 IMO 2020 and its significant impacts on Heritage
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34:10 Balancing competition in new and foothold markets
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36:57 The route density network effect
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38:43 Additional monetization opportunities at Heritage
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40:39 Helping frontline employees become effective salespeople
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43:06 The challenges of hiring and retaining people within a tight labor market
-
45:50 Assessing the potential of automation in a services business
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47:06 Managing the volatility of the re-refinery business
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51:35 Setting fair goals for employees who work in volatile business lines
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52:56 Family influence at Heritage: appealing or concerning?
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55:59 Balancing short-term pain for long-term gain
-
57:39 Looking back at that last 4 years as CEO of Heritage
-
58:50 Bolt-on and tuck-in acquisition opportunities
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1:01:17 Filling in the West Coast coverage gaps at Heritage
-
1:03:18 The benefits of scale in the waste services industry
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1:05:17 The biggest changes experienced over the last 15 years
-
1:06:45 The most misunderstood aspects of Heritage-Crystal Clean
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jorge Gonzalez, the CEO of The St. Joe Company. St. Joe is a 2.53 billion dollar market cap company whose main asset is a huge landholding in Northwest Florida. A lot of investors may remember that the company has been the subject of a number of short reports over the last decade but since Jorge became CEO in 2015, St Joe has consistently grown its revenue and EBITDA—and has diversified its revenue base. Also, after a period of time in which the stock was unable to break out, over the last year it has risen to levels that had not been seen since the mid-2000s.
Given the company’s recent success, I was excited to talk to Jorge about his vision of the future of the company and what people may not be appreciating its asset base. Specifically, we discussed:
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What it means to operate as an owner-oriented company;
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The demographic trends that are fueling growth in Northwest Florida;
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What the shorts have gotten wrong over the years;
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How the company approaches the risk of hurricanes in the region; and
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What Jorge has learned from the company’s Chairman, Bruce Berkowitz of Fairholme Capital
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Timestamps:
-
1:18 Introduction
-
2:36 Being named the next CEO of St. Joe
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3:19 Shifting St. Joe’s strategy, culture, and process of execution
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4:08 Adjusting corporate strategy to expand the total market size
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5:18 St. Joe’s vast land holdings and unique moat
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6:38 Florida’s demographic shifts and how that might affect St. Joe
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8:18 How COVID has affected the trends driving St. Joe’s business
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9:52 Handling cyclicality at a macro and geographic level
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11:46 Building a recurring revenue stream in a traditionally cyclical business
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15:28 Further enhancing an already improving business model
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18:05 Balancing an expansion beyond Florida with internal investment opportunities
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19:10 Choosing between internal development, partnerships and the sale of land assets
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20:58 The synergies that exist between residential, commercial, and other infrastructure
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24:04 Ensuring expertise exists within a small core team
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25:45 What does a good partner look like for St. Joe?
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27:36 What does St. Joe mean by “owner-oriented?”
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29:19 Why St. Joe invests so heavily in growth over buying back shares
-
30:52 Lessons learned from Bruce Berkowitz
-
31:51 How decisions get made at St. Joe
-
34:40 How to decide which people should be on the bus
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37:17 What factors did David Einhorn get right in his 2015 short analysis?
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38:42 St. Joe’s remaining developable acreage
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40:14 How St. Joe benefits from a 50-year master development plan
-
41:58 What attractions are missing from St. Joe’s core counties
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42:58 Building win-win relationships with government stakeholders within the community
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45:27 How St. Joe avoids being seen as “too powerful” within the community
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46:37 Building storm resiliency in an area directly affected by environmental challenges
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49:49 The benefits of building modern infrastructure from scratch
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50:57 How modern community design has improved over the years
-
52:35 Futureproofing a home or community as a real estate developer
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55:14 How an investor should approach St. Joe
-
58:31 St. Joe’s key performance indicators and measures of success
-
59:47 Why St. Joe is still a “cheap” investment
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62:07 Looking at book value per share as an assessment of St. Joe’s progress
-
62:50 Instilling a long-term mentality within a corporate culture
-
64:14 Why mistakes are sometimes more valuable than are successes
-
65:42 The most misunderstood aspect of St. Joe
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Mark Dankberg, the co-founder and Executive Chairman of Viasat. Viasat is a 3.8 billion dollar market cap company that provides broadband and communication products and services worldwide. Viasat started off a defense-oriented company but has since layered on consumer and business-facing offerings by developing the world’s leading high throughput geostationary satellites.
Over the next 2 years, Viasat will be launching 3 new satellites that will give the company the ability to offer global coverage to its military and in-flight WIFI customers. Additionally, Viasat is rolling out community WIFI initiatives to help people in emerging and frontier markets connect to the internet for the first time. All of this is happening while the company is facing a growing threat from low earth orbit satellite providers such as Elon Musk’s Starlink.
Given how much is going on and the fact that Mark recently went from being the CEO to assume the Executive Chairman role, I thought it would be a perfect time to talk to him about the following topics:
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The future of the global satellite broadband industry, including competition with Starlink;
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What the US military needs now from Viasat and how that may evolve over time;
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The cultural differences between the defense and commercial sides of the company;
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How Viasat can benefit from all the space-related activity going on right now; and
-
Why this was the right time to shift his focus
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Key takeaways:
-
Deeply understanding your customers’ wants and needs is a prerequisite for success in both D2C and B2B business. But, the more intermediaries you have, the less you can really understand your end customers. Also, working with distribution partners can be difficult if the goals of the organizations are not aligned.
-
Not every industry is a winner-take-all market. Network effects and multisided marketplaces can create virtuous cycles and winner-take-all markets. In industries with supply constraints, negative network effects drive competition and ensure a diverse set of offerings.
-
Bandwidth demand is heavily affected by geography and low-earth-orbit (LEO) networks are geographically limited. Despite offering low latency, every incremental satellite will only spend a fraction of its time over the areas with the most demand, and far more over oceans and other low demand areas. This is why a hybrid network that includes geostationary and LEO satellites is likely the best solution for customers.
-
When a company is entering new markets or introducing new products, it is imperative to be a voracious reader of business history and theory, as well as to be well-grounded in the basic math that governs the industry.
-
Modern warfare requires real-time information and instant communication. Accordingly, the U.S. military will need an up-to-date network of satellites with ground stations placed in safe locations in order to process and anticipate the moves of its adversaries.
Timestamps:
1:18 - Introduction
2:56 - Diversifying into direct-to-consumer (D2C) with the 2009 WildBlue acquisition
5:06 - The organizational restructuring required when shifting towards D2C
7:06 - Building a D2C sales organization within a legacy B2B company
11:51 - Making stair-step improvements with every new satellite launch
18:50 - The process of deciding to build Viasat’s own satellite
27:30 - Satellite broadband is not a winner-take-all market
31:32 - LEOs, GEOs, hybrid networks and why there is no “best” satellite design
45:27 - Building a cohesive culture with two distinctly different business segments
51:23 - Why Viasat 3 will play a key role in the future of warfare
58:25 - How Viasat benefits from all of the excitement around space
62:40 - What Mark has learned from Baupost Group’s founder Seth Klarman
65:53 - Being confident in putting out guidance even before the Viasat 3 satellites launch
70:55 - The least understood aspects of Viasat
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Alan McKim, the Founder, Chairman and CEO of Clean Harbors (NYSE: CLH). Clean Harbors is a 5.6 billion dollar market cap company that provides environmental and industrial services within North America. The company has two segments: Environmental Services and Safety-Kleen Sustainable Solutions. In the Environmental segment, Clean Harbors collects, treats and disposes of waste within its company-owned landfills and incinerators. In addition, the Safety-Kleen division provides cleaning and waste disposal services to customers such automotive repair shops. In fact, Clean Harbors is the largest recycler of used motor oil in North America.
Alan McKim founded the company in 1980 and took it public at $9 in 1987. Over that period of time, Clean Harbors has made a number of large acquisitions, including the transformational merger with Safety-Kleen in 2012. The company now produces over 3 billion dollars in revenue and its stock has risen to over $100 per share.
It is not often that I have a chance to talk to someone who has run a company for 40 years. So, I really enjoyed peaking with Alan about the following topics:
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The uniqueness of the Clean Harbors asset base and how that creates a moat;
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How the company decides to take big swings when it comes to M&A
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Educating people about how Clean Harbors is a good actor in a world increasingly focused on ESG;
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The impact of further environmental regulation on the company; and
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Building a cohesive culture over 40 years
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Key Takeaways:
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Moats that are developed in highly regulated industries can be quite durable
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Large acquisitions often take some time to get right but you have to be willing to periodically take big swings
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Regulators can be your allies: every inspection is an opportunity to learn new best practices and build a safer environment
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Even companies that don’t start with a focus on return on invested capital (ROIC) can develop that metric as a North Star—and shareholders can help with that process
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Creating a culture of safety is essential at company with thousands of field employees
Time stamps:
1:19 - Introduction
3:03 – Rationale for making the biggest acquisition in CLH’s history
5:23 – How familiarity with a business improves post-merger integration
7:12 – How environmental sustainability played a part in the acquisition of Safety-Kleen
9:10 – Are people actually putting used motor oil down the drain?
10:07 – Strategy behind keeping acquired brands alive
11:29 – Why take another $1 billion-plus swing at HydroChem now
14:05 – Integration learnings from 65 acquisitions
16:53 – Acquisition strategy learnings over a long career of acquisitions
18:54 – The virtual impossibility of green-fielding brand new incinerators in the US
20:30 – Why now is the time to expand incinerator capacity through brownfield development
23:07 – Building a culture and company that will accept short-term pain for long-term gain
24:45 – How CLH has suffered from acquiring assets outside of its core
26:23 – The advantage of having recently added a new incinerator to a facility
28:04 – Creating win-win relationships with diverse regulators
29:49 – Using regulatory fines as a learning moment
31:43 – How to position a company to benefit from future regulation
33:41 – The moat that comes from having a dense route network
34:55 – The impact of the electric vehicle revolution on used motor oil demand
36:52 – Challenges facing the re-refined oil business
38:36 – What’s being missed at Clean Harbors
41:21 – Building a sustainable and consistent culture through organic growth and acquisitions
43:40 – Career learnings around compensation
45:17 – Succession planning as a founder and CEO
46:57 – Empowering a board to give real feedback to the founder
48:58 – Building an adaptable organization in an ever-changing industry
51:04 – Improving internal ESG planning and participation
52:44 – How shareholder feedback has been helpful in the past
54:32 – Why insider selling of shares isn’t always a bad thing
55:48 – International M&A as a potential avenue
58:47 – Alan’s ideal legacy
60:38 – Focus as a tool for growth
62:12 – The origins of ROIC as an internal north star
63:54 – The least understood aspects of Clean Harbors
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on this episode is Jeff Rosica, the CEO of Avid Technology, a 1.2 billion dollar market cap company that sells software and hardware for digital media production and management. For decades, Avid’s products have been considered the gold standard in the entertainment industry. In fact, its Media Composer and Pro Tools products are used to make many of the movies you see and to create the songs you listen to.
Jeff Rosica was Avid’s Chief Sales Office and became the CEO in 2018. Since then he has overseen the company’s transition to a SaaS, or software-as-a-Service business model. After a few fits and starts, the company has started to deliver on its margin and cash flow targets as the benefits of the business model transition are flowing through the financial statement. Given the company’s recent success and my desire to better understand Avid’s journey, I thought it would be a great time to catch up with Jeff and discuss:
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What moving from perpetual licenses to a subscription software business really looks like internally
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How the company is approaching a world where people can create great content on their iPhones
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Whether or not having activist shareholders involved in the company can be helpful
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And how to balance the different cultures within engineering and sales teams
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Key Takeaways:
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You can’t fix a business without first fixing the culture. Without the right people, you have nothing
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Fear the innovators more than you fear the incumbents. If you aren’t willing to cannibalize your own business to innovate, you’ll never win against the ankle biters.
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Listening to alternative perspectives is incredibly important and often activist investors can be those voices.
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With the right underpinning of a solid company, you can change a company incredibly quickly—and probably even faster than you would think. You might regret certain things you do if you move fast, but you’ll always really regret the things you didn’t change and improve.
Time stamps:
1:20 – Introduction
2:50 – Being named interim CEO with no forewarning
4:55 – Communicating your strategy as a new CEO
6:02 - Was being CEO always part of the plan?
8:10 – What it took to fix a broken culture
9:49 – Building a media creation tool in the age of iPhones and accessible software
12:55 – Competing with innovative ankle biters as the incumbent
15:55 – Balancing the dreams of engineers with the realities of the business
18:34 – How COVID has changed consumer needs for media creation
21:07 – Moving from a perpetual license business to a modern SaaS structure
23:27 – Fixing a company first and then thinking about M&A
26:50 – Capital allocation strategy now that M&A is on the table
29:23 – How activist shareholders have helped AVID
35:13 – Maintaining bargaining power even against the largest customers
37:17 – Remaining focused in a world with geographically diverse opportunities
39:18 – Managing rising stakeholder expectations during a period of rapid growth
41:00 – Incentivizing an organization to achieve stretch goals
43:48 – COVID’s long term effects on a tradeshow-focused industry
47:49 – Mistakes made and lessons learned as a brand new CEO
51:07 – Expanding an organization’s focus from the short run to the long term
53:05 – Jeff’s ideal legacy
54:37 – Knowing when a company is ready to take on new initiatives
56:29 – Getting better at communicating with stakeholders regarding ESG
59:05 – Lessons learned in trying to get the right people on the bus
1:01:45 – Why industry consolidation has always been 1 year away
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire. For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Mauricio Ramos, the CEO of Millicom. Millicom is a 3.75 billion dollar market cap mobile and broadband company that primarily operates in Latin and South America. What is most interesting about Millicom is its leading positions in its largest markets and how rapidly the company is transforming itself into a broadband leader in the region.
Mauricio has been CEO since 2015 but has been involved with the industry since the late 1990s. Over his tenure, he has overseen the company’s ongoing exit from its African operations as well as its expansion through M&A into new markets such as Panama. Mauricio spent a number of years working for Liberty Global and has brought the John Malone cable playbook to Millicom.
COVID has presented the company with some unique challenges and I thought it would be a great time to catch up with Mauricio about his outlook for Millicom and the markets the company operates within.
In this conversation, we had the opportunity to cover:
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The rationale for spending aggressively to become a more broadband-focused company
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What he learned about cable industry while working for Liberty Global
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The process of working to become better known by US investors
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The benefits of owning cable and wireless assets in their markets
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How to establish a cohesive culture across borders
Key Takeaways:
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The biggest learnings from Liberty Media’s John Malone: business focus and clarity are what drive success so you must eliminate distractions.
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How to create moat in cable and broadband: benefit from a first mover advantage where possible, build a committed customer base that is driven by great customer service, offer multiple products that allow you to sell a low priced bundle and consistently reinvest in your brand
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Developing cultural traditions within an organization can build incredible employee buy-in across all levels of an organization.
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Turning your employees into long-term investors through compensation drives organizational buy-in for long-term strategic decisions.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Timestamps for this episode:
1:19 - Introduction
2:55 - What happens when your largest investor exits its position
6:52 - The flexibility and autonomy afforded when a controlling shareholder departs
9:12 - Millicom’s unique structure that comes from trading on two exchanges
10:32 - How an investor can get comfortable investing in Latin America
16:07 - What Mauricio learned from John Malone and Liberty Global
21:16 - Fixed mobile conversion as a value generator
24:39 - What is Millicom’s moat?
29:04 - Customer service culture as a moat
31:52 - Creating a consistent culture across varied geographies
37:24 - The benefits of Millicom’s scale in Latin American
41:04 - How Millicom creates win-win relationships with governments and regulators throughout Latin America
46:18 - The perception of cable and mobile businesses and the disparate multiples they trade at
51:00 - Millicom’s capital allocation strategy
53:45 - How strategy can vary depending on market position within a country
56:55 - How to align the organization behind long-term goals even if there are short-term challenges
59:22 - Mauricio’s biggest learnings from his years as CEO
1:01:50 - What is the most misunderstood part of Millicom?
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire. For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Jim Hallett, the former CEO and now Executive Chairman of KAR Auction Services. KAR is a $2.25B market cap company that operates within the wholesale auto remarketing industry. Jim is very well known in the used car auction industry and has built up a wealth of knowledge over his close to 30 years at KAR. He joined the company back in 1993, then became CEO in 2009 and just this past April stepped back to Executive Chairman.
During his tenure, Jim has overseen the company’s spin-off of IAA, which is now a $7.3B market cap company on its own. He also has helped spearhead the company’s aggressive initiatives to extend its digital offerings and add scale beyond KAR’s physical car auction facilities.
In this wide-ranging discussion, we covered:
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Jim’s thoughts on KAR’s very important pivot to digital that occurred in 2020
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What has changed about the car auction industry over the last three decades
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Why he thought it was the right time to pass the torch
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Maintaining the company’s culture within a rapidly changing industry
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Why KAR believes that the model of the future is hybrid: digital and physical
If you are at all interested in how incumbent companies defend their turf against digital upstarts, this was a great discussion.
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Timestamps for this episode:
1:50 - Introduction
3:42 - KAR’s rapid digital transformation
6:12 - Putting customer safety over market share
9:30 - Managing stakeholders during a transformational change
11:50 - Layering a digital strategy on top of a historically brick and mortar business
13:42 - Balancing KAR’s rapid digital transformation with the needs of customers
16:37 - Digitizing their dealer-to-dealer business through M&A
20:43 - Key lessons learned competing against digital upstarts
23:14 - M&A: to build or to buy?
25:30 - Successful leaders have to embrace change
28:56 - How do you know when to pass the CEO torch?
31:31 - Digitization of the used car auction industry
33:42 - Imparting a culture of optimism
36:42 - Growth opportunities via expanding into Europe
40:02 - Limiting management distraction while expanding outside the US
41:12 - Competing for digital talent from Indiana
44:40 - Pushing old school customers to digitize their business
48:42 - Maintaining a moat within an increasingly digital world
51:35 - Jim Hallett’s ideal legacy
54:45 - Biggest changes in the car auction industry over 3 decades
57:57 - Most underappreciated aspect of KAR’s hybrid model
1:00:25 - Why the industry may never be fully digital
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire. For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Sean O’Connor, the CEO of StoneX Group (NASDAQ: SNEX), a $1.2 billion dollar market cap financial services company that generated over $50 billion in revenue in fiscal year 2020. Sean became the CEO of International Assets Holding Company in 2002 and was a key architect of the 2009 transformational merger with FCStone that serves as the foundation of what StoneX is today. During his tenure, the company has been quite acquisitive and has added several new product lines and geographies. Currently, StoneX is involved in a number of businesses, including:
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Risk management and hedging services
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Commodities trading
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Equity securities trading
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International payments; and
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Foreign exchange services
Sean has been a steward of a stock that is now 3.5 times higher than it was when the FCStone merger closed, a period of time in which book value per share is up over 4 times. In this wide-ranging discussion, we cover:
-
Sean’s philosophy on M&A and integrating companies
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How StoneX approaches risk management and what the company has learned from prior mistakes
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The process of incubating and funding an international payments business; and
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How financial services companies can distinguish themselves from competitors
This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/
Timestamps for this episode:
1:50 - Introduction to SNEX CEO Sean O’Connor
3:35 - Why even attempt a transformational merger during the Global Financial Crisis
12:04 - The challenges associated with deals where the minnow swallows the whale
19:30 - Deep integration vs. a hands-off approach post-acquisition
23:00 - Building a differentiated risk management culture at StoneX
31:01 - Important lessons from significant loss events
37:11 - Starting an international payments business from scratch
44:04 - How StoneX looks at cryptocurrency as an opportunity
47:37 - Creating a moat around StoneX despite the competition
59:13 - StoneX’s relationship with regulators and becoming good at regulation
1:03:19 - Key elements that have propelled StoneX’s valuation
1:06:27 - The most underappreciated aspect of StoneX: long term-compounding
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire. For more information about Cove Street Capital, please visit: https://covestreetcapital.com/
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Tom Gayner, the co-CEO of Markel Corporation. Markel is a Fortune 500, $16.7 billion market cap financial holding company that primarily operates in the insurance and re-insurance industry. Though Tom has only been in the co-CEO seat since 2016, he has been with Markel for close to 30 years and he has been an investor longer than that. Markel has been compared to Berkshire Hathaway in both structure and performance and Tom has been a key architect of the company’s diversification away from insurance through the acquisition of operating businesses. In fact, Markel Ventures has gone from $1.2 billion in revenue in 2016 to about $2.8 billion today.
Tom is well-known in the value investing community for his charm and intellect. Also, many people who have made the trek to Omaha for the Berkshire Shareholder Meeting have also attended the Markel Breakfast event. I had the opportunity to listen Tom speak a number of times in Omaha and that is why I thought he would be a great guest on the podcast. In this conversation, we will cover:
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His thoughts on what makes a compounder
-
How to invest more like a grandmother than a Wall Street trader
-
And why he is a better investor because he is a CEO—and vice versa
Click the timestamp to jump to each answer:
1:38 - Introduction
3:07 - The 2008-09 financial crisis and Markel’s response
7:55 - The benefits of a legacy of family ownership
11:39 - Comparing today’s market to that of 1998-99
15:53 - The benefits of investing like a grandmother
18:18 - How being a Co-CEO has made Tom a better investor
24:09 - How to tell if a person is a good cultural fit
28:35 - Building culture by articulating what your company stands for
32:15 - Bottom up and top down approaches to compounding
35:39 - Applying the Colfax Business System at Markel
38:08 - Some challenges of working within a family-controlled business
42:03 - Markel’s willingness to invest today for future benefit
48:45 - How Markel Ventures helps diversify the company
51:53 - Why culture is a big part of the moat around Markel’s insurance operations
55:14 - The emergence of ESG and embedding Quaker values
62:30 - Tom’s ideal legacy within Markel
63:50 - Learning from your mistakes to become more adaptable
66:14 - Starting with principals and then learning by doing
69:15 - The most under appreciated aspects of Markel
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
My guest on the show today is Weston Hicks, the CEO of Alleghany Corporation. Alleghany is a Fortune 500, $9.3B market cap company that focuses primarily on the insurance and re-insurance industry. Weston became CEO all the way back in late 2004 and since then, the company has grown its book value significantly and, like a mini-Berkshire Hathaway, has built up an interesting portfolio of non-insurance businesses that includes everything from a machine tool company to a toy company. And the Berkshire parallels don’t end there. Weston is a value investor at heart and is well known for his eclectic shareholder letters where he dives deep into the insurance industry and the capital markets as a whole.
Weston was a key driver of the company’s 2011 transformational merger with TransRe, a deal that established Alleghany as a global insurance powerhouse.
After close to 20 years with the company, Weston will be retiring at the end of this year. So, I thought it would be a great opportunity to talk to Weston before he officially leaves the CEO seat and get his insights and perspectives, on a variety of topics, including:
-
His thoughts on what makes a compounder
-
The benefits and the setbacks associated with the merger with TransRe
-
How to compensate people and establish a competitive advantage within the insurance industry
-
The emergence of ESG and how that impacts a company that underwrites catastrophe risks
Click the timestamp to jump to each answer:
3:40 – Introduction and the transformational merger with TransRe
7:50 – Weston’s plan as CEO (why the diversification into reinsurance)
9:50 – What made TransRe such a compelling opportunity
11:30 – The difficulties of M&A and why Alleghany is unique as a company
13:30 – The big surprises from the TransRe deal
14:55 – Looking back on the TransRe transaction 10 years later
17:50 – The impact of new competition moving into reinsurance
20:24 – What makes insurance companies such effective compounders
23:19 – Compensation as a lever for performance
25:40 – The history of Alleghany’s investment strategy
28:11 – How involved the board is in capital allocation
32:00 – Alleghany’s capital allocation strategy, investing North Star, and inevitable missteps
36:20 – Alleghany Capital and family run businesses
40:47 – Growing Alleghany Capital & the insurance business
43:17 – Weston’s approach to growing shareholder wealth
48:30 – Hiring, compensation, and employee retention
52:08 – The emergence of ESG
57:20 – Why Alleghany utilizes special dividends
61:20 – Alleghany’s exceptional stock growth
64:40 – What about Alleghany makes Weston so comfortable stepping away
67:50 – Areas where Alleghany has had to adapt
70:25 – What is the most misunderstood aspect of Alleghany?
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @InoculatedInves and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
iTunes: https://apple.co/3xlUvPY
Spotify: https://spoti.fi/3jxkxLl
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.
Welcome to the Compounders Podcast, where we explore the anatomy of public company wealth creation stories. On this show, we invite you to be a fly on the wall for the actual conversations professional investors have with public company CEOs. Through a series of interviews, we will learn about how to create a compounder—a sustainable company whose success builds upon itself—by hearing about the real-life experiences of leaders who run smaller-cap public companies. I’m your host, Ben Claremon, a partner and portfolio manager at Cove Street Capital. In these conversations, I interview public company senior executives by posing the exact type of questions I ask as part of Cove Street’s diligence process.
By talking to people who operate within a wide variety of industries, we will dig into the holistic aspects of company building that you are not going to hear anywhere else. Whether you are a professional investor, founder or someone who is simply interested in business, we think this podcast has something for you.
To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on Twitter at @InoculatedInves and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.
Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.
All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.