The Business Brew

Matt Cochrane (@Matt_Cochrane7 on Twitter) stops by The Business Brew to discuss his investment philosophy, how it’s evolved over the past few years, Big Tech, and more. Matt is a police officer with a passion for investing. He began his investment education by studying The Motley Fool discussion boards. Bill and Matt catch up regularly and Bill always enjoys chatting with Matt. This week they decided to record one of those conversations. We hope you enjoy the discussion.

This episode features Alex Morris of TSOH Investment Research.  You can find his Substack at https://substack.com/profile/10489671-the-science-of-hitting.  In this episode, Alex and Bill have a casual conversation; mostly about media and cable. Through the conversation you will hear how Alex thinks about partnering with companies and management teams for the long term.  You will also hear how Alex thinks about competitive positions and strategic decision making. Alex is a wonderful person that is sharing his investment journey publicly.  We hope you enjoy the conversation and, should you decide to subscribe, enjoy his research as well. Thank you to @mathewpassy (on Twitter) for the show production. Please leave us a rating in your favorite podcast player!

Daniel Needham, CFA, stops by The Business Brew for a wide ranging discussion. Daniel is a wealth of knowledge. He is president of Morningstar’s Wealth Management Solutions, which includes software and aggregation capabilities from Morningstar Office and ByAllAccounts, and the individual investor experience across Morningstar.com, and Morningstar Investment Management.After the recent acquisition, he also oversees the U.K. and international business of Praemium and their core products, which were re-branded to Morningstar Wealth Platform and Wealthcraft, a Morningstar company.Prior to his current role, Needham served as president and global chief investment officer since 2015 for Morningstar’s Investment Management group, a unit of Morningstar, Inc., that provides managed portfolio services, retirement, and investment advisory for financial institutions, plan sponsors, and advisors through investment management entities around the world.In 2013, Needham stepped into the global chief investment officer role for the Investment Management group, and he also assumed responsibility for Morningstar’s investment management operations in Europe. Previously, Needham was chief investment officer and managing director for Investment Management in Asia-Pacific, including Ibbotson Associates Australia, where he led the group’s business and investment activities in the region.Needham joined Morningstar in 2009 through the company’s acquisition of Intech Pty Ltd., where he served as chief investment officer. He also held other investment roles including analyst, portfolio manager, and head of multi-strategy. Before joining Intech in 2002, Needham worked for Zurich Financial Services in Sydney. Needham holds a bachelor’s degree in commerce from the University of Sydney, where he majored in finance and economics.He also holds the Chartered Financial Analyst® designation and is an interested trustee for the Morningstar Funds Trust.Supplemental Information -Following the podcast recording, Mr. Needham sent the following information to Bill (shared with permission):Here are some useful books to learn more about MMT and Post-Keynesian economics. It pays to tread carefully with all this stuff given the political leaning of the respective economic schools of thought.Soft Currency Economics – Warren Mosler – provides a lens to why the system is different for certain governments post the gold standardJohn Maynard Keynes – Hyman Minsky – one of the best early critiques of the modern economic consensus that dominates central banks and government treasuries

Kyle Mowery, Founder & Portfolio Manager at GrizzlyRock Capital stops by The Business Brew to discuss his investment philosophy.  Kyle is a traditional value investor that tends to focus on smaller, cyclical companies.  In this episode he talks about why he fishes in that pond, where he has found his biggest winners, how he thinks about investing, and much more.  GrizzlyRock does very deep due diligence and Bill thinks highly of their work. We hope you enjoy the conversation! You can find Kyle’s Orion Engineered Carbons conversation with Andrew Walker at https://open.spotify.com/episode/7xmapUv85wtAoHpGlcMxmP?si=3wZXGogJT5-zbU5aJxv1NA or https://yetanothervalueblog.com/podcast Thank you to @mathewpassy (on Twitter) for the show production. Please leave us a rating in your favorite podcast player! Detailed Show Notes: 4:30 – Kyle’s view on the macro environment 7:00 – What Kyle learned in 2008 8:00 – What working in mezzanine debt did for Kyle’s career 10:50 – A case against microcaps 12:00 – Due diligence 14:50 – What was interesting about Darling International? 19:50 – What GrizzlyRock sees in OEC 26:05 – The merits of running a long/short strategy 29:15 – Chicago chit chat 35:15 – Back to investment discussion 36:30 – Why Kyle prefers more of a deep value philosophy 40:57 – What got Kyle interested in Orion Engineered Carbons? 51:14 – What is CoVest Select 1:01:10 – Thoughts on starting a fund

Marc Cohodes' (@AlderLaneEggs on Twitter) LinkedIn profile describes him as the "Head Bull Fighter at Alder Lane Farm."  He is a well known short seller, but in this episode he discusses how he thinks about his long positions more than he discusses short selling.  Marc is highly entertaining, informed by deep due diligence, and is not afraid to say what is on his mind. We hope you enjoy this episode. Detailed Show Notes: 2:00 – Marc discusses scuttlebutt 7:00 – The importance of getting it right and why Marc runs a concentrated portfolio 8:50 – How Marc deals with emotions with concentrated bets 13:20 – Dealing with talking publicly about ideas 18:05 – What was Marc doing with the AMC “apes” 29:00 – Marc’s thoughts on how the market currently works (or doesn’t work) 38:20 – What Marc sees in TZero 43:50 – Thoughts on position sizing and “having a seat at the table” 50:00 – Discussion about Camping World 58:20 – Enovix conversation 1:09:30 – Does Marc worry about being wrong?

Evan Tindell joins The Business Brew to discuss how his background as a poker player influences his investing philosophy, how he got started in the business, and he drops some knowledge about shorting. Bill reached out to Evan because Bill wanted to discuss position sizing and “Kelly betting,” which was the catalyst for this conversation. Please pardon some construction noise in the beginning, the conversation’s quality is worth listening past some background noise. You can follow Evan’s firm at https://www.biremecapital.com/ and Evan at @evantindell on Twitter (https://twitter.com/evantindell). We hope you enjoy the conversation. Please leave us a rating in your favorite podcast player/app. Detailed Show Notes 2:00 - Evan’s Background 7:20 - Overtrading 9:30 - How poker losses help investing 11:30 - How price impacts analysis 22:50 - Evan’s start as an asset manager 26:30 - Evan looks for cognitive reasons the market is wrong 28:00 - Evan’s view on size 33:30 - A Netflix Discussion 44:45 - Bet sizing 48:20 - Position sizing and merger arb 53:00 - Incentives and money management 57:26 - How to think about Kelly betting and risk reward throughout an investment 1:02:45 - Fighting the bias to sell early 1:05:43 - Shorting high value 1:10:50 - Managing shorting 1:23:00 - Twitter whistleblower discussion and wrap up

Scott Reardon, Portfolio Manager at Dakota Value Funds, Author of The Dark Continent series and Bonfire of the Beasts, stops by The Business Brew to chat about what he learned by studying the greatest investors of all time.  Scott's work led him to focus on very favorable risk/reward scenarios.  While that might sound trite, it's hard in practice. You can read Scott's work at: Greatest investors: https://www.dakotavalue.com/stewart-s-bridge-paper Cyclicality of markets and life: https://www.dakotavalue.com/draper-s-carousel We hope you enjoy the conversation! Album art photo taken by Mike Ando. Please see www.mikeando.com. Thank you to @mathewpassy (on Twitter) for the show production. Please leave us a rating in your favorite podcast player! Detailed Show Notes: 6:45 - Scott’s background 9:00 – Scott’s strategy 11:45 – How Scott developed his strategy by studying the greats 15:30 – Could we have stuck with Charlie Munger as a young investor? 18:20 – Within value investors there tends to be two camps 19:45 – Scott’s favorite investors 25:45 – Does value need a catalyst? 28:00 – Microcaps vs Mid Caps 34:00 – Scale advantages and scale economics 44:00 – Scott and Bill discuss learning they may not know anything General Discussion 1:03:00 – Thoughts on where to fish for investment ideas 1:08:00 – A nonacademic conversation on dividends vs buybacks 1:13:30 – Incentives matter 1:20:00 – Analyzing a wide distribution of outcomes

Just a quick message to let you know Bill is on vacation with his family, but episodes of the Business Brew will return in a few weeks.

Chadd Garcia hosted the The Business Brew for this conversation.   Chadd runs the Ave Maria Focused Fund, which is a non-diversified mutual fund (ticker: AVEAX).  His portfolio holding are eclectic.  Some themes you will see in there are quality and compounders.  However, several of the companies are undergoing business transformations or have advantaged business models. Chadd has an interesting background.  He grew up on a family farm in Arizona.  He worked in management at a multi-national agribusiness, where he helped turnaround of a business.  He caught the investing bug and headed to Harvard Business School to get into finance.  He spent time in investment banking and private equity before moving over to public markets.  I think these experiences give him an interesting perspective and thought process that he brings to investing.  He’s a natural teacher and I am excited for this episode. Chadd is lead portfolio of the Ave Maria Focused Fund and co-portfolio manager of the Ave Maria Growth Fund.  He is also responsible for equity research functions for the firm. Previously, Chadd analyzed public equities as a Managing Director at SQ Advisors.  Prior thereto Chadd worked in private equity as a Managing Director at Gulf Coast Capital Partners and as Vice President at Comvest Partners.  Before his work in private equity, Chadd was an Associate in the mergers and acquisitions group at CIBC World Markets. Chadd has a Bachelor of Science degree in Agricultural Resource and Economics from The University of Arizona and a Master of Business Administration degree from Harvard University.  He is a board member and CFO of The Rising Farmworker Dream Fund and is a Knight in the Sovereign Military Order of Malta. He is a CFA® charterholder. Contact Chadd at CMG@schwartzinvest.com Ave Maria Funds Page:  https://www.avemariafunds.com/fund-family/aveax.html Fund Commentary Found Here:  https://www.avemariafunds.com/financial-insight/fund-commentaries.html Album art photo taken by Mike Ando. Please see www.mikeando.com. Thank you to @mathewpassy (on Twitter) for the show production. Please leave us a rating in your favorite podcast player! Detailed Show Notes: 2:40 - What Chadd learned from studying HEICO 12:10 - An accounting lesson worth listening to 19:45 - Chadd's thesis on eDreams 29:40 - What Chadd looks for to premortum businesses 33:00 - A discussion about Green Plains and business transformation 39:10 - A discussion about GFL (a waste management company) 42:40 - How Chadd thinks about position sizing 44:50 - The moral component of what Chadd does 53:55 - How Chadd analyzed the short report behind GFL

Vitaliy Katsenelson stops by The Business Brew to discuss investing and his new book; Soul In The Game (see https://soulinthegame.net/).  Vitaliy is an amazing writer who discusses investing and life.  You can find his writings at https://contrarianedge.com/.  We hope you enjoy this discussion.   No detailed show notes on this one.  This episode is brought to you by Bastiat Partners, a a new breed of investment and merchant bank that specializes primaries, secondaries, and co-investment opportunities in the private markets.  Bastiat caters to a unique coverage universe of 250+ family offices, VCs, and crossover hedge funds. While sector generalists, the Firm specializes in fast-growing technology and technology-enabled businesses, advising companies on primary capital raises and creating liquidity events for founders and early investors via secondary transactions. The Firm also advises fundless sponsors and GPs on co-investment opportunities. Bastiat Partners was founded nearly a decade ago by Nader Afshar, a former senior investment banker at J.P. Morgan, and is headquartered in Los Angeles. See https://bastiatpartners.com/. Securities offered by Hollister Associates, LLC, Member FINRA/SIPC.  Bastiat Partners and Hollister Associates, LLC are not affiliated companies. Please leave us a rating in your favorite podcast player. Album art photo taken by Mike Ando. Please see https://www.mikeando.com. Thank you to @mathewpassy (on Twitter) for the show production.