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TIP622: Finding Certainty in an Uncertain World w/ Joseph Shaposhnik
Apr 12, 2024
Joseph Shaposhnik, a seasoned Portfolio Manager at TCW, shares his high-quality investing philosophy. He discusses the importance of certainty in investing, emphasizing recurring revenue as a key criterion for evaluating business quality. Joseph critiques traditional advice on business selection, presenting his own investment approach developed under legendary mentors. He highlights his focus on growth in free cash flow and underscores the significance of management incentives in driving long-term shareholder value, using Meta as a case study to illustrate market volatility versus stability.
01:11:51
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Quick takeaways
- Quality investing requires certainty in business evaluation for sustainable growth.
- Management incentives and recurring revenue impact value creation and capital allocation decisions.
Deep dives
Quality Investing Framework and Certainty in Business Evaluation
Joseph Schaposhnik discusses the importance of a quality investing framework focused on certainty in evaluating businesses. He highlights Warren Buffett's emphasis on certainty in business evaluation criteria, noting that predicting cash flows and business direction is crucial. Using examples like Meta and Roper Technologies, he contrasts businesses with high predictability and sustainable growth against uncertain ones, emphasizing the significance of certainty in business evaluation.
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