Many of the world’s most exciting, high-growth and disruptive companies are private. Moreover, the entrepreneurs running them are typically keeping them private for longer before trading their shares on public stock exchanges – and in some cases have no plans to do so.
Baillie Gifford’s Private Companies Team seeks out exciting businesses and founders in this space to give our clients access to an increasingly important source of long-term growth. Taking a highly selective approach, it has invested more than $9bn across over 140 firms over the past 12 years. In this podcast, Alexander Nicolier explains how it does so and discusses some of our notable holdings.
Background:
Alexander Nicolier is an investment manager in our Private Companies Team. In this Disruption Week briefing, he reveals the scale of the opportunity and the increasing impact that the sector’s restless founders and their exceptional companies are delivering.
From SpaceX to Bending Spoons, Epic Games to ByteDance, one of the distinguishing features of these pioneering firms is that they’ve been able to choose their shareholders. Nicolier reveals why Baillie Gifford’s patient approach and reputation have helped make us a favoured partner.
He also reveals how deep research helps him and his colleagues embrace the uncertainty that can be involved with backing companies at an earlier stage of growth than many public market stocks. And he introduces some of his team’s most recent investments, including the immersive experience specialist Cosm and the next-generation computing company Tenstorrent.
Resources:
Alexander Nicolier profile
Armand Spitz: seller of stars
Baillie Gifford Private Companies hub
Disruption Week
Private companies: investing in trailblazers
The hidden cost of software
Companies mentioned include:
Bending Spoons
ByteDance
Cosm
Disney
Epic Games
Loft
MercadoLibre
Meta
NuBank
Oddity
SpaceX
Starlink
Tempus
Tencent
Tenstorrent
Tesla
Timecodes:
0:00 Introduction
1:30 What’s often misunderstood about private companies
2:40 Relationship building in Brazil and Colombia
3:40 Why reputation matters
5:35 “Look out for a gringo”
6:30 Private markets’ scale
7:00 Our clients’ advantage
9:25 SpaceX and uncertainty
12:40 Dealing with setbacks
13:45 Bending Spoons’ business model
16:50 Cosm’s ‘shared reality’ experience
18:50 Tenstorrent and Jim Keller’s talent magnetism
20:20 The state of the IPO market
21:55 Why Epic Games has stayed private
25:00 Disney’s $1.5bn stake in Epic Games
26:40 “Too big to ignore”
