This week, Dan Rasmussen - founder of Verdad Advisors and author of The Humble Investor - drops by to challenge conventional wisdom, discuss humility, and stir up some lively debate.
In this conversation, Dan discusses his investment philosophy; focusing on the risks associated with private equity, the unpredictability of future growth, and the importance of patience in investing. Dan also touches on his approach to investigating biotech investing.
We hope you enjoy the show.
Sponsorship Information
Thank you to Fiscal.ai for sponsoring the show.
DISCOUNT INFO: If you use the affiliate link fiscal.ai/brew, you will automatically get 2 weeks of Fiscal Pro for Free and if you find that you want to upgrade, my link will get you 15% off any paid plans. About Fiscal.ai
Fiscal.ai is the complete modern data terminal for global equities.
The Fiscal.ai platform combines a powerful user experience with all the financial data capabilities that professional investors need.
Users get up to 20 years of historical financials for all stocks globally that they can easily chart, compare, or export into their own models.
And unlike legacy data terminals where it can take hours or even days, Fiscal.ai’s data is updated within minutes of earnings reports.
Fiscal.ai also tracks all the company-specific Segment & KPI data so you don’t have to.
Like to track Amazon’s Cloud Revenue? They’ve got it.
How about Spotify’s premium subscribers?
Or Google’s quarterly paid clicks?
They’ve got all of it.
Takeaways
Private equity is often treated as less risky than it truly is.
The recent decline in private equity fundraising indicates a shift in investor sentiment.
Future growth rates are unpredictable.
Focus on profitability and quality in business investments.
Volatility is predictable both in cross-section and time series.
Japan may be a good place for value investors to hunt.
David Gardner returns to discuss his new book: Rule Breaker Investing: How to Pick the Best Stocks of the Future and Build Lasting Wealth. After decades of research, the book is a culmination of David's work in investing. This conversation should whet your appetite and help understand David's philosophy.
Takeaways
Investing requires a long-term mindset and patience.
Market volatility is a natural part of investing.
Concentration in a few strong positions can be beneficial.
Initial position sizing should be conservative, typically around 5%.
Avoid adding to losing positions; focus on winners.
Understanding the brand and leadership of a company is crucial.
Total addressable market can expand, leading to growth opportunities.
AI can enhance investment strategies and content creation.
Investing is about understanding the underlying business, not just stock prices.
Building a portfolio should reflect personal values and vision.
Other Episode
You can find David and Bill's first conversation at:
Apple: https://podcasts.apple.com/us/podcast/david-gardner-an-investing-fool/id1540847053?i=1000542928487
Spotify: https://open.spotify.com/episode/6QQaQXlOz4mvjFS425vkQs?si=VsXHLcseTneft5J0APQS_Q
Youtube: https://www.youtube.com/watch?v=VXijHth4OrU
Sponsorship Information
Thank you to Fiscal.ai for sponsoring the show. DISCOUNT INFO: If you use the affiliate link fiscal.ai/brew, you will automatically get 2 weeks of Fiscal Pro for Free and if you find that you want to upgrade, my link will get you 15% off any paid plans. About Fiscal.ai
Fiscal.ai is the complete modern data terminal for global equities.
The Fiscal.ai platform combines a powerful user experience with all the financial data capabilities that professional investors need.
Users get up to 20 years of historical financials for all stocks globally that they can easily chart, compare, or export into their own models.
And unlike legacy data terminals where it can take hours or even days, Fiscal.ai’s data is updated within minutes of earnings reports.
Fiscal.ai also tracks all the company-specific Segment & KPI data so you don’t have to.
Like to track Amazon’s Cloud Revenue? They’ve got it.
How about Spotify’s premium subscribers?
Or Google’s quarterly paid clicks?
They’ve got all of it.
Braden Dennis stops by to discuss building Fiscal.ai. Long time show listeners may remember Stratosphere.io. That was "Era 1" of the company. Today, Braden is working on "Era 3" of the company; Fiscal.ai.
Braden talks about building a product for himself, to acquiring customers, to early LLM adoption, and finally to competing with FactSet. Fiscal.ai recently raised $10mm in a Series A round led by Portage and Social Leverage.
We hope you enjoy the conversation. It's a cool story.
ALSO, if you use the affiliate link fiscal.ai/brew, you will automatically get 2 weeks of Fiscal Pro for Free and if you find that you want to upgrade, my link will get you 15% off any paid plans.
Thank you for using the affiliate link, I appreciate the support. -Bill
Spencer Cibelli, Investment Associate at Robotti & Company, stops by to discuss Haypp Group; the world’s largest online retailer of nicotine pouches and traditional snus products. The nicotine pouch category is, as Mugatu would say, "So hot right now." Spencer details Haypp's unique characteristics, benefit to customers, and value offered to suppliers. This business has an interesting niche. And may just be an unlikely "Win-Win-Win" example. Enjoy the episode!
Sponsor Notes
This episode is brought to you by Fiscal.ai
Fiscal.ai is the complete modern data terminal for global equities. The Fiscal.ai platform combines a powerful user experience with all the financial data capabilities that professional investors need.
Users get up to 20 years of historical financials for all stocks globally that they can easily chart, compare, or export into their own models.
And unlike legacy data terminals where it can take hours or even days, Fiscal.ai’s data is updated within minutes of earnings reports. Fiscal.ai also tracks all company specific Segment & KPI data so you dont have to!
Use my affiliate link fiscal.ai/brew, you will automatically get 2 weeks of Fiscal Pro for Free and if you find that you want to upgrade, my link will get you 15% off any paid plans.
Takeaways
Haypp is the world's largest online retailer of nicotine pouches.
The company has a unique data insights business that contributes to its revenue.
Consumer behavior in the nicotine pouch market shows a willingness to switch brands.
Regulatory challenges are significant but manageable for Hape.
Pricing strategies allow Haypp to offer lower prices than traditional retailers.
The growth potential in the nicotine pouch market is substantial, especially in the US.
Management's long-term vision is focused on market share growth.
Valuation metrics suggest Haypp is an attractive investment opportunity.
The online penetration of nicotine products is still low, indicating room for growth.
Haypp's relationships with manufacturers are symbiotic and beneficial for both parties.
Jeffrey Collins, Managing Partner of Cloverlay, stops by to discuss how Cloverlay builds private portfolios to offer clients uncorrelated returns. In this conversation, Jeff explains how Cloverlay provides access to private assets that are often overlooked by traditional investors, emphasizing the importance of correlation in portfolio management. The discussion covers various investment opportunities, including sports rights, telecom spectrum auctions, dark fiber, and intellectual property. Jeff shares insights on navigating regulatory changes and lessons learned from past investments, ultimately highlighting the future outlook for investment strategies in a rapidly evolving market.
Takeaways
Cloverlay specializes in esoteric niche private assets.
The firm manages $1.6 billion in assets.
Investments are designed to be uncorrelated and predictable.
Understanding correlations is key to portfolio management.
Investing in sports rights was a unique opportunity in 2020.
Telecom spectrum auctions favor smaller investors.
Dark fiber investments are critical for data centers.
Regulatory changes can create new investment opportunities.
Past investments provide valuable lessons for future strategies.
Cloverlay aims to be a resource for institutional investors.
Jeff's Bio
Jeff serves as Managing Partner of Cloverlay and is a member of the Firm’s Investment Committee and Board of Directors. Prior to founding Cloverlay, Jeff was a Managing Director with Morgan Stanley Alternative Investment Partners (AIP), a division of Morgan Stanley’s institutional asset management business. While at AIP, Jeff was a member of the Executive and Business Committees and served on AIP’s Private Markets Investment Committee as a Portfolio Manager responsible for leading primary fund, co-investment and secondary transactions focused on special situations globally and North American buyouts. Prior to AIP, Jeff advised and traded equity options and futures with U.S. hedge funds in Morgan Stanley’s Equity Derivatives Group in New York. Prior to Morgan Stanley, Jeff was on the investment team at Petra Capital Partners, where he was responsible for screening, researching, structuring and monitoring private equity investments in health care and information services companies. Prior to Petra Capital, Jeff was an investment banker at Robertson Stephens, where he executed a variety of public and private equity, debt and convertible offerings along with mergers and acquisitions in financial services, health care, and business services.
Ryan Dobratz stops by to discuss various aspects of the real estate market, primarily focusing on Freddie Mac and Fannie Mae. The discussion touches on the political implications surrounding Freddie and Fannie, as well as trends in the residential housing market and manufactured housing policies. Weaved into the conversation is interest rates, CPI, and the impact of AI on industrial real estate.
Takeaways
Stuart Loren, Managing Director at Fort Sheridan Advisors, stops by the show to discuss investing in The Age of Social Disruption (that hyperlinks to his presentation of the idea).
Stuart explores how economic, social, and political disaffection is reshaping investment opportunities and societal dynamics. He highlights the decline in geographic mobility, the housing crisis, and the rise of populism as key factors influencing current political landscapes. The discussion also touches on the impact of AI on economic growth and the challenges faced by local and federal governments in addressing these issues.
Stuart can be found on X and LinkedIn.
Takeaways
We're experiencing a period of social disaffection.
Geographic mobility has significantly decreased over the years.
The housing market is becoming increasingly unaffordable for many.
Political responses are shifting towards populism on both sides.
Economic mobility is declining, leading to frustration among younger generations.
Trust in government institutions is at an all-time low.
Social connections are weakening, leading to increased political polarization.
AI could play a crucial role in future economic productivity.
Local politics are becoming more important in addressing social issues.
Investors need to adapt to a changing political and economic landscape.
James Davolos stops by to discuss the emerging importance of water solutions in oil and gas production.
He shares insights on behavioral investing, the evolution of investment strategies at Horizon Kinetics, and the challenges and innovations in water management within the energy industry. The discussion also touches on market dynamics, competitive landscapes, and the future outlook for investment opportunities in this niche sector.
Takeaways
Water solutions in the oil and gas sector are becoming increasingly important due to rising water cuts in production.
The Permian Basin generates significant amounts of produced water, necessitating effective management solutions.
Market misunderstandings can create opportunities for companies specializing in water management.
The competitive landscape is shifting, with water management companies gaining leverage over traditional oil and gas firms.
Investment opportunities may exist in companies with strong water management capabilities and innovative technologies.
The future of energy will likely require a balance of traditional hydrocarbons and innovative water solutions.
Long-term investment strategies are essential for navigating the complexities of the energy sector.
Wes Gray returns to the show to discuss a potential solution for those with concentrated financial investments. Wes discusses a solution, via a Registered Investment Company, that enables investors to diversify their position while deferring taxes. We hope the episode is informative.
Find Wes at:
Twitter: https://x.com/alphaarchitect
RIA/blog/education: http://alphaarchitect.comETFs: http://funds.alphaarchitect.comWhite label ETF: http://etfarchitect.com
Andrew Freedman, Communications Analyst at Hedgeye Risk Management, stops by to discuss his experience integrating AI in his life. Bill contacted Andrew after Andrew tweeted "So many (very smart) people still can’t grasp the implications of AI…" This episode is premised on that tweet. It's a good one!
Follow Andrew on X at https://x.com/HedgeyeComm or connect with him on LinkedIn at https://www.linkedin.com/in/andrew-freedman-cfa/
Mary Meeker's AI Presentation/Deck - https://www.bondcap.com/report/tai/#view/0
Follow Bill on X at https://x.com/BillBrewsterTBB
The one and only John Huber stops by The Business Brew. John runs Saber Capital Management. Bill found John through Base Hit Investing back in the day. Today you can follow John's writing at Basehitinvesting.substack.com.
Bill admires John's mental flexibility, grit, and consistency. The Business Brew is happy to feature John this week!
🧠 What You’ll Learn in This Episode
📌 Strategic insights into value investing
📌 How to evaluate high-quality growth companies
📌 The risks of overpaying and the dangers of outsourcing your thinking
📌 Thoughts on Berkshire Hathaway’s future
📌 Portfolio management and balancing writing with fund operations
📌 Opportunities beyond the S&P 500
🕰️ Timestamps
00:00 – 👤 John Huber’s Introduction
03:10 – 📉 Berkshire & Market Reflections
06:22 – 💹 Investment Strategies & Market Insights
11:10 – 🚀 Evaluating Growth Engines in Quality Companies
17:02 – 🏢 Tech Giants & Capital Expenditure
26:30 – 🏦 Banking Sector & Investment Risks
34:48 – ⚠️ The Risk of Overpaying for Stocks
36:00 – 🔄 Adapting Investment Strategies
37:57 – 🧩 The Danger of Outsourcing Thinking
40:51 – 🌍 Opportunities Outside the S&P 500
47:24 – ✍️ Balancing Writing & Fund Management
01:00:22 – 🔮 The Future of Berkshire Hathaway
01:07:25 – 👋 Concluding Thoughts & Farewells
Andy Constan stops by to discuss today's US macro backdrop. Importantly, this discuss was recorded on 4/24. Since then the narrative around the tax bill has gotten incrementally more stimulative. Do what you will with that information.
Bill reached out to Andy after following him for a while on Twitter. Andy appears to use Twitter to educate, inform, and journal thoughts. Hence why he was invited to the show.
As for Andy's formal background, his bio reads as follows:
Andy Constan graduated with a degree in Bioengineering from the University of Pennsylvania in 1986.
Following he spent 35 years investing and trading global equities, spending 17 years at Salomon Brothers.
Following he started honing his Macroeconomic Knowledge in 2010 working at Bridgewater Associates and Brevan Howard.
Since then he has worked on growing Damped Spring Advisors.
We hope you enjoy the conversation.
Bill Chen returns for a third time. Bill focuses on "hard assets," with a specific focus on real estate. The conversation winds from some macro (from 15 minutes to 22ish minutes) to more REIT specific ideas (after 24 minutes).
Please note, some of the tariff discussion is already out of date. Nevertheless, we hope you enjoy the conversation!
Bill Chen's other episodes can be found at: https://www.youtube.com/watch?v=oyf41BmMYxU and https://www.youtube.com/watch?v=Tmoc2crT55U
For a different perspective on real estate investing check out Ryan Dobratz' episodes at https://www.youtube.com/watch?v=UIVr5Jvr-2M
Few things are more ironic than releasing a China focused episode on Liberation Day. Nevertheless, here we go!
In this episode of The Business Brew, host Bill Brewster interviews Jingshu Zhang, a persistent listener who recommended looking into China's investment opportunities. Zhang shares his journey from studying in the United States to becoming a successful investor with a unique focus on Chinese assets. They discuss Zhang's experience navigating the Chinese market, the impact of geopolitical tensions, the advantages of holding Chinese state-owned enterprises (SOEs), and specific investment opportunities like Pinduoduo and Tencent. Zhu offers insights into managing risk, the macroeconomic environment, and the regulatory landscape in China. Disclaimer: All content is for entertainment purposes only and not financial advice.
00:00 Introduction and Guest Background
01:15 Investment Opportunities in China
04:04 Challenges and Sentiments Towards Chinese Investments
08:15 Competitive Landscape and Market Dynamics
15:50 Case Study: TK Group and Industrial Sector Insights
22:55 Pinduoduo's Growth and Strategy
34:37 Exploring Global Investment Opportunities
35:19 US Market Insights and Mid Cap Focus
36:08 Tech Giants and Valuation Comparisons
36:13 Tencent: The Super App of China
43:32 State-Owned Enterprises and Investment Safety
53:20 Environmental Regulations and Investment Opportunities
56:59 Delisting Fears and Investment Strategies
01:04:09 Short Selling Challenges and Lessons Learned
01:07:49 Final Thoughts and Contact Information
Welcome to The Business Brew! Host Bill Brewster is joined by repeat guest Evan Tindell to delve into pressing investment topics for 2024. Evan is the founder and portfolio manager of Bireme Capital. You can find his first episode here: https://creators.spotify.com/pod/show/william-brewster1/episodes/Evan-Tindell---Where-Poker-and-The-Market-Collide-e1nrbum (Spotify) or https://podcasts.apple.com/si/podcast/evan-tindell-where-poker-and-the-market-collide/id1540847053?i=1000579552480 (Apple).
Together, they explore international valuation disparities, the pitfalls of shorting meme stocks, and the dynamics behind recent market movements. Evan shares his unique approach to investing and the lessons learned from challenging investment phases, including a critical analysis of MicroStrategy, GameStop, and meme stocks.
They also discuss Japan's corporate governance reforms and the implications for global investors. Lastly, Evan and Bill touch on utilizing modern AI tools in investment processes, the future of software, and personal stories from Evan's adventurous journey to Zambia.
As a reminder, nothing discussed constitutes investment advice and is for entertainment purposes only. Enjoy the engaging conversation!
00:00 Welcome to The Business Brew
01:20 Introducing Evan Tindell
02:01 Discussing 2024 Performance
03:09 Challenges of Shorting Meme Stocks
05:14 Bitcoin Yield and MicroStrategy
17:55 Market Inefficiencies and Opportunities
30:59 Investing in Japan
42:09 Investment Strategies and Market Insights
43:17 Diverse Business Models in Japan
44:58 Meeting the Emperor and Personal Anecdotes
45:35 The Role of LLMs in Investment
51:48 AI Tools and Their Impact on Daily Life
56:10 Future of Software and Business Models
01:07:12 Tobacco Industry Analysis
01:15:12 Adventures in Zambia
01:20:36 Conclusion and Farewell
In this episode, the host welcomes back Devin Anderson, co-founder of an investment advisory firm and competitive shotgun shooter. They delve into the psychology and skills required for high performance in sports like shooting, golf, and tennis. Devin shares insights from his own experience and coaching on the importance of building skills consciously, then executing them unconsciously under pressure. He highlights the nuances of practice, routine, and dealing with pressure to achieve peak performance. The discussion also touches on the parallels between competitive sports and high-stakes business environments, emphasizing structured planning and routine for consistent success.
00:00 Introduction and Guest Background
00:35 Competitive Shotgun Shooting Explained
01:32 The Mental Game: Conscious vs. Unconscious Execution
03:52 Why We Play: The Allure of Sports
07:17 Coping with Pressure in Sports
14:01 Skill Building and Confidence
17:06 The Role of Vision in Performance
26:16 Routine and Unconscious Performance
42:11 Overcoming Evaluation Paralysis
42:49 The Four Stages of Execution
44:04 The Importance of Practice Routines
44:58 Building Confidence Under Pressure
49:09 Handling Fear and Careful vs. Careless Misses
50:42 Trust and Performance Under Pressure
55:52 The Role of Routine in Performance
01:09:25 The Fun and Pressure of Competition
Join host Bill Brewster as he converses with the intriguing and often humorous anonymous guest, Le Shrub, in this episode of 'The Business Brew'. Le Shrub's writings can be found at https://www.shrubstack.com/ He can also be followed on Twitter/X at https://x.com/agnostoxxx
With a unique approach to investing, Le Shrub shares his thoughts on market trends, stock picks, and the rationale behind them. From discussing the importance of avoiding investment stupidity, analyzing specific stocks like Archer Aviation and Alibaba, to speculating on the economic impacts of a potential Ukraine ceasefire, this episode is packed with insightful observations and strategic thinking. Be prepared for an engaging mix of entertainment, education, and parody, underlined with Le Shrub's distinct charm.
Disclaimer: This is all for entertainment purposes and not financial advice. Recorded 2/14/25
00:00 Introduction to the Business Brew
00:54 Meet Les Shrub: The Anonymous Guest
01:24 Investment Philosophy: Don't Be Stupid
03:35 The Spinny Ponzi: A Deep Dive into Archer
17:15 Biotech Investments: Blood in the Tweets
21:00 The Future of Cancer Vaccines
22:55 ClearPoint and Gene Therapy
30:02 The Power of Community in Investing
33:19 Navigating the Risks of Small Cap Stocks
34:07 Options Trading Strategies
35:36 The Risks of Investing in Alibaba
36:13 Reasons for Investing in Alibaba
36:38 China's Economic Strategies and Stimulus
37:27 Alibaba's AI and Cloud Ventures
39:00 Apple's Partnership with Alibaba
40:31 The Impact of U.S. CapEx on AI
41:19 Investing in Energy and Natural Gas
44:38 The Barbell Portfolio Strategy
45:17 Emerging Markets and Currency Devaluation
52:53 The Potential Ceasefire in Ukraine
59:15 Valuation and Investment Strategies
01:04:19 Avoiding Shorts on Meme Stocks
01:06:50 Recommended Reading: Capital Returns
01:07:50 Conclusion and Final Thoughts
In this episode of 'The Business Brew,' host Bill Brewster is joined by Larry Holzenthaler, a portfolio manager at First Eagle Alternative Credit (FEAC). The discussion focuses on the complexities and nuances of private credit. Recorded on February 3rd, the episode delves into the differences between traditional equity value investing and private credit, as well as the strategic transitions First Eagle has made in response to market changes. Larry explains First Eagle's cautious approach to investment, emphasizing measured risk, recurring revenue, and sponsor-backed deals. He discusses the evolution and growth of private credit markets, challenges and opportunities, and the impact of banking regulations on credit availability. The conversation includes detailed insights into various investment structures like interval funds and BDCs, and the importance of reading fine print in credit agreements. Throughout, Larry offers a compelling argument for the attractiveness of private credit as an investment, particularly in current economic conditions.
00:00 Welcome to the Business Brew
00:54 Introducing Larry Hosenthaler and First Eagle
02:13 The Evolution of Private Credit
08:34 The Impact of COVID on Private Credit
12:22 Private Equity and Risk Management
18:41 The Role of Banks in Private Credit
31:37 Fee Structures and Market Dynamics
36:40 Understanding Interval Funds
37:11 The Redemption Process Explained
39:55 Comparing Interval Funds and BDCs
43:17 Risk Management in Private Credit
44:38 The Role of Recurring Revenue
45:24 Leverage and Deal Flow
56:59 Active vs Passive Management in Credit Markets
01:03:27 Why Invest in Private Credit Now?
01:08:46 Conclusion and Final Thoughts
In this episode of The Business Brew, host Bill Brewster engages in a comprehensive discussion with George Livadas about the complexities and current state of the market. Livadas, known for his candid tweets and insightful views, covers topics ranging from market fluctuations in 2024, reminiscent of the 2021 SPAC bubble, to challenges and opportunities in European stocks and the S&P 500's relentless performance. They delve into George’s investment philosophy, focusing on both large and small cap stocks, the impact of global flows on stock valuations, and the nuanced approach required in shorting and hedging. Additionally, they discuss the operational aspects of running a fund, including transitioning from separate accounts to a unified fund structure, and reflect on the broader implications of AI in investment research.
00:00 Welcome to the Business Brew
00:03 Introducing George Livadas
01:06 Market Reflections and SPAC Bubble
06:56 European Market Insights
18:20 Shorting Strategies and Market Sentiment
21:42 Challenges in the Staples Sector
24:57 Running the Firm: Changes and Challenges
27:14 Navigating Market Ups and Downs
27:40 Client Expectations and Realities
28:39 Challenges in Fundraising and Fee Structures
29:44 The Fund of Funds Debate
31:51 AI in Financial Research
35:15 Investment Strategies and Market Trends
39:48 Reflections on COVID and Market Resilience
43:38 Portfolio Management Insights
46:05 Closing Thoughts and Personal Reflections
Buffett and Munger Unscripted: A Conversation with Alex Morris
Alex Morris, friend of the show (and IRL), author of TSOH Investment Research stops by to discuss his new book "Buffett and Munger Unscripted." The book offers three decades of insights from Berkshire Hathaway shareholder meetings, grouped by topic area to provide a coherent understanding of Warren Buffett and Charlie Munger's investment wisdom.
Alex shares his experience writing the book, including the extensive work involved and his communication with Berkshire. They also discuss various investment philosophies, the importance of transparency in investment research, and the challenges faced by consumer brands in today's market.
Further, they reflect on the impact and potential risks of long-term investments in businesses like Dollar Tree and the complexities of analyzing brands like Jack Daniels.
00:00 Welcome to the Business Brew
00:06 Introducing Alex Morris and His New Book
02:02 Personal Anecdotes and Family Stories
05:15 The Journey of Writing the Book
12:23 Insights on Buffett and Munger's Investment Strategies
28:53 Discussion on Dollar Stores and Retail Landscape
34:19 Analyzing Dollar Tree's Market Position
36:06 The Value Proposition of Dollar Stores
38:08 Comparing Retail Strategies
39:23 Brand Value and Pricing Power
41:14 Consumer Brands and Retail Dynamics
44:27 Investment Strategies and Portfolio Management
49:11 The Philosophy of Investing
55:01 The Business of Writing and Publishing
01:00:44 Reflections and Future Plans
