Capital Allocators – Inside the Institutional Investment Industry Adam Wyden - ADW Capital (Manager Meetings, EP.37)
Sep 22, 2022
In this conversation, Adam Wyden, Founder and Managing Partner of ADW Capital, shares insights from his journey in small-cap investing. He discusses the strategic shift of his fund from activism to valuing stable, quality companies. Adam highlights the resilience of small-cap stocks, particularly in challenging markets, and explores the traits of ideal investors. The dialogue touches on the pivotal role of data-driven strategies, alongside personal anecdotes, emphasizing the grit needed for navigating investment challenges.
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Early Influences and Investment Beginnings
- Adam Wyden's grandmother, a stock club leader, taught him about compound interest early on.
- Inspired by Joel Greenblatt's concept of orphan securities, he started investing in undervalued companies during the financial crisis.
ADW's Early Success and Transition
- ADW Capital started with under $500,000 and grew to $8-9 million in its first year by investing in undervalued companies like Lorex Technologies.
- Initial focus was on activism, but Wyden found it exhausting and shifted towards high-quality, growing companies.
Importance of Management Alignment and Long-Term Perspective
- Wyden realized that partnering with financially aligned management teams is crucial.
- He emphasizes that knowing when to sell is difficult, so owning companies where time is your friend is beneficial.