Capital Allocators – Inside the Institutional Investment Industry

Adam Karr – Extreme Alignment at Orbis (EP.338)

Sep 14, 2023

In this engaging conversation, Adam Karr, President and Portfolio Manager at Orbis, shares insights from his unique journey in global equity management. He discusses Orbis' innovative fee structures, including performance rebates that align interests with clients. Adam reveals their long-term investment philosophy and the use of analyst shadow portfolios to enhance decision-making. He also touches on the importance of cultivating talent and personal growth, all while emphasizing the joys of life outside the financial realm.

58:52

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Episode guests

Adam Karr

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Episode notes

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Quick takeaways

Orbis promotes alignment with clients through unique business practices, such as a fee structure with rebates during underperformance.

Orbis encourages long-term thinking and independent decision-making with their privately owned, perpetuity charitable foundation ownership structure.

Orbis emphasizes the importance of culture and people, creating an environment that attracts and retains independent-minded individuals.

Deep dives

Orbis' Business Practices and Alignment

Orbis, a global equity manager, focuses on creating alignment through unique business practices. They have a fee structure with rebates and a permanent ownership model. This encourages alignment with clients by offering refunds during underperformance. The alignment also extends to the firm's ownership structure, as they are privately owned by a perpetuity charitable foundation. These business practices promote long-term thinking and the ability to make independent contrarian decisions.

Intro

5min

From Military Aspirations to Wall Street Dreams

3min

A Journey Through Investment: From HBS to Global Equity Management

3min

Aligning Interests: Innovative Investment Strategies

13min

Navigating Global Investment Strategies

22min

Fleetcor: Navigating Opportunities in a Changing Market

6min

Cultivating Talent and Embracing Life's Pleasures

1min

Lessons from Investment Mistakes and the Power of Culture

4min

Today's sponsored insight is with Adam Karr, the President and Portfolio Manager at Orbis, a $35 billion global equity manager founded in 1989 by legendary Fidelity alum Allan Gray. Orbis blends unique business practices with a long-term intrinsic value investment model designed to invest differently.

Our conversation dives into Orbis’ business practices intended to create alignment, including a fee structure with rebates and a permanent ownership model. We then go through the investment approach that features thirty-five analyst shadow portfolios to bring data and independent thinking to portfolio construction. Orbis’ model has rich lessons for managers and allocators alike.

For full show notes, visit the episode webpage here.

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