The Business Brew

David Barr (@PenderDave on Twitter) is the President and Portfolio Manager at Pender Fund Capital Management.  He focuses primarily on Canadian small cap equities, but is not limited to that subset of investments.  Bill met Dave at an MOI Global event in 2019 and was very excited for Dave to join The Business Brew because Dave truly loves stock picking.   Dave is extremely well respected, high integrity, and looks at the world through a unique lens.  While some people see small cap investing as riskier, Dave sees it as an opportunity.  Perhaps it's because of his background in venture capital ("VC").  Perhaps it's because he does better "work" than others.     Whatever the reason, The Business Brew is grateful for his time and hope we introduce an investor that warrants respect.    Topics discussed include: ~2:50 - Bill and Dave discuss MOI Global as a community ~4:30 - Dave discusses small cap investing ~7:40 - "Microcap draws people who are business analysts" ~8:35 - How venture capital influenced Dave ~10:00 - Why redemptions disproportionately influenced small caps in 2018 ~13:00 - How Dave thinks about marrying VC thinking with equity investing ~15:50 - How journaling helped Dave remember what COVID was really like ~20:00 - Avoiding envy in a social media world ~22:00 - Dave's experience getting "active" (read: constructive) with his holdings ~28:00 - What the Canadian Venture Exchange is and why companies are going public now ~35:00 - How Canada can lead in the financial trends and a discussion on how bubbles form ~45:00 - Dave's thoughts on balancing a portfolio of "compounders" and rerating investments ~49:00 - Are public markets really "long term?" ~53:00 - Is it possible to fully appreciate the right tail of outcomes? ~1:00:00 - Companies are people organizations now; reflexivity matters ~1:04:00 - Follow @PenderFelix! ~1:09:00 - Why Dave is respected by colleagues and how he's been able to achieve success ~1:15:00 - What to learn from Buffett ~1:20:00 - Founder/CEO turnover in smaller cap companies as a risk factor ~1:34:00 - Some SPAC talk

This episode features Francisco Olivera (@FrancoOlivera on Twitter) and Alex Morris (@TSOH_Investing on Twitter).  Francisco and Alex are Bill's "mastermind" group.  The three of them talk daily and discuss ideas.  Scroll down to see topics and time stamps.    This episode was recorded in early May.  The AT&T and Discovery deal changes some of the discussion.  Nevertheless, the thought process is what's more important than the event outcome.  Alex and Francisco will return in Season 2 to discuss more media.  We are certain of that.   Please also note that Alex sold Qurate Retail Group after this episode was recorded.     Unfortunately, Bill's mic is a little distorted in this episode, but the conversation was so good that Bill didn't want to scrap it.  The three gentlemen hope you all enjoy the conversation.     Sign up for Alex's Substack at https://thescienceofhitting.substack.com/   Check out Francisco's most recent "pitch" for Roblox at https://www.dropbox.com/s/qg827ammn51axwg/Roblox%20Investment%20Memo_vF.pdf?dl=0 and you can see him on Andrew Walker's podcast at https://www.youtube.com/watch?v=Np3AQjNV4OY    Time stamps as follows: ~2:00 - starting a Substack and thinking through the frequency of client communication ~8:00 - Francisco's research process and why he's Bill's Abominable NO-man. ~12:00 - Position sizing ~17:00 - Buffett on Verizon  ~19:00 - Takes on Berkshire annual meeting ~35:00 - What a "bull market" may do to how we all frame investments (note Alex's YOLO hedge idea at ~39 minutes) ~44:00 - How we think about cash/macro; leads into big tech talk ~50:00 - How our investing philosophy has changed. ~53:00 - Comcast discussion ~58:00 - AT&T discussion (changed with deal) ~1:03:00 - Disney discussion ~1:09:00 - Alex presents a counter to some of the Never Sell narrative and points out that great companies go through tough periods ~1:14:00 - Microsoft talk  ~1:19:00 - Difference between multiples and market caps ~1:21:00 - Back to position sizing ~1:30:00 - GEICO vs Progressive ~1:35:00 - Back to Substack, then Alex describes his Substack offering at ~1:39:00 ~1:48:00 Qurate Retail Group ~1:50:00 - Alex and Francisco's bet for Apple to buy Disney ~1:55:00 - Twitter talk ~2:00:00 - Podcast strategy ~2:20:00 - State of Pay TV          

Brian Feroldi (@brianferoldi on Twitter) joined The Business Brew to discuss his investment philosophy.  Brian is doing some very cool things to spread the message of personal finance and intelligent investing.  Matt Cochrane (@matt_cochrane on Twitter) and Austin Lieberman (@libermanaustin on Twitter) vouch for him as a person.  That means something to Bill.      As for the discussion, Bill enjoyed speaking to Brian very much.  Brian is process driven, open minded, and implements a different style from Bill's.  Thus, he's exactly the type of guest Bill looks to speak to.     Bill's takeaways from this conversation are as follows:   Brian is smart, writes everything down, has an intelligent mental model of how the world works, is trying his best to do something positive for the finance industry, and has a passion for learning. He looks for businesses with huge potential and market caps that are capable of growing for a long time.  He articulates some of the concepts behind David Gardner's "Rule Breaker" philosophy very well in this episode.    Studying the philosophy that underlies Brian's strategy has been a great experience for Bill.  The strategy is very different from Warren Buffett's, but it has created impressive outcomes for those that follow it.  While Buffett takes large swings, Brian's strategy involves owning many companies and allowing the stocks to grow into concentrated bets. As he says, "make your biggest holdings earn their spot."   We hope you enjoy this conversation.  If you do then please subscribe to Brian's Substack https://brianferoldi.substack.com/ and YouTube channel at https://www.youtube.com/channel/UCs60_Z83HU76uygzHRQl0kA.  ALSO, PLEASE GIVE US A 5 STAR RATING IN THE APP STORE IF YOU LIKE WHAT WE ARE DOING.     Thank you for listening!

Title - Austin Lieberman - Squash The Beef   Description - Austin Lieberman stops by The Business Brew for a special “squash the beef” episode. Austin and Bill are mortal enemies stemming from a classic “value vs growth” bet. Please see this GoFundMe link for details https://www.gofundme.com/f/fintwit-war-value-vs-growth?utm_campaign=p_cp_url&utm_medium=os&utm_source=customer.    While Austin and Bill are not actually mortal enemies, they did disagree on their investment philosophy. Austin is more focused on faster growing companies than Bill has traditionally focused on.  Their style differences caused them to talk past each other. One day Austin told Bill that the problem with “value investors” is they think there’s only one way to invest.  Bill realized Austin had a point, which upset Bill (mostly because he hates being wrong).    That conversation sent Bill on a path to study other styles. For that, he is grateful to Austin. More importantly, Bill is also grateful to Austin’s military service. Austin served as a Tactical Air Control Party (TACP) Officer in the Air Force.  He talks about how that influenced him as a person and as an investor in this episode.  This conversation is light hearted, good natured, and a fun way for two people from opposite ends of the investing spectrum to come together to talk investments.    We hope you enjoy and are entertained. 

George Livadas stopped by The Business Brew to discuss his background, investing framework, and investment strategy.  George is the founder and CIO of Upslope Capital Management.  Bill really likes how George looks at the world.  You can find George's work at https://www.upslopecapital.com/.   George's portfolio tends to be focused on industries he covered in the past.  Bill was curious to discuss how George thinks of his gross exposure (long exposure minus short exposure) and whether shorting has been, and will be, a good idea in the future.  A reason for Bill's interest in long/short strategies is thinking about whether long/short strategies are a better method of diversification relative to the traditional 60/40 stock/bond allocation.   In this conversation George talks about his investment theories, position sizing, how he sees risk/reward, and much more.  The Business Brew is happy to feature him this week.     You can follow Upslope Capital on Twitter at @UpslopeCapital.

Jeremy Raper stopped by The Business Brew to discuss his unique way of viewing equity markets. Jeremy is a global investor that looks for value in obscure places. He views the world through a credit lens, which is fun for Bill since that’s Bill’s background. This episode covers position sizing, illiquid microcap positioning, global investing, and more. Thank you to Jeremy for joining!

First and foremost, Bill owns stock in OppFi.  This episode is not an invitation or solicitation to buy or sell shares in FGNA, the entity that OppFi is merging with in a SPAC transaction.  Second, The Business Brew and Bill encourage listeners to do their own due diligence and talk to their financial advisor before purchasing or selling shares in any security. With that said, Bill wanted to interview Jared because OppFi sits at the intersection of many Business Brew episodes.  To begin, FGNA is taking the company public via SPAC (See Andrew Walker's episode for a discussion on SPACs).  Next, Mike Mitchell, our first guest, introduced Bill to Kyle Cerminara, a recent guest, who is part of the group taking OppFi public.  Finally, OppFi would have never passed Bill's "smell test" if it wasn't for Tyrone V. Ross' episode where Tyrone talked about the need for serving the underbanked. In the interest of complete transparency, Bill does not have a significant portion of his net worth allocated to OppFi.  Instead, OppFi is part of a "basket bet" Bill made on Kyle Cerminara.  Within that bet, Bill finds the incentives of all the people involved compelling.  That said, Bill has not done enough work, nor is he convinced enough on OppFi's prospects, to make OppFi a significant weighting in the portfolio. For the avoidance of doubt, this podcast interview is biased and is part of an open source due diligence project.  Bill may change his mind at any time and does not commit to letting people know when he does so. We hope you enjoy the episode.

William Green is the author of RICHER, WISER, HAPPIER: How the World’s Greatest Investors Win in Markets and Life (April 20, 2021; Scribner). Green has written for many leading publications in the US and Europe, including The New Yorker, Time, Fortune, Forbes, Barron’s, Fast Company, Money, Worth, Bloomberg Markets, The Los Angeles Times, The Boston Globe Magazine,  The New York Observer, The (London) Spectator, The (London) Independent Magazine, and The Economist. He has reported in places as diverse as China, India, Japan, the Philippines, Bangladesh, Saudi Arabia, South Africa, the US, Mexico, England, France, Monaco, Poland, Italy, and Russia. He has interviewed presidents and prime ministers, inventors, criminals, prize-winning authors, the CEOs of some of the world’s largest companies, and countless billionaires.     While living in London, Green edited the European, Middle Eastern, and African editions of Time. Before that, he lived in Hong Kong, where he edited the Asian edition of Time during a period in which it won many awards.   Green has collaborated on several books as a ghostwriter, co-author, or editor. One of them became a #1 New York Times and #1 Wall Street Journal bestseller in 2017. He also worked closely with a renowned hedge fund manager, Guy Spier, helping him to write his much-praised memoir, The Education of a Value Investor: My Transformative Quest for Wealth, Wisdom, and Enlightenment. Green also wrote and edited The Great Minds of Investing, which features short profiles of 33 renowned investors, along with stunning portraits created by Michael O’Brien, one of America’s preeminent photographers.   Born and raised in London, Green was educated at Eton, studied English literature at Oxford, and received a Master’s degree from Columbia University’s Graduate School of Journalism. He lives in New York with his wife, Lauren, and their children, Henry and Madeleine.

Corey Hoffstein, host of Flirting with Models, stopped by The Business Brew to have a wide ranging conversation about markets and his career.  Corey is an amazing thinker.  Rather than summarize his thoughts we would direct listeners to his website: https://blog.thinknewfound.com/author/choffstein/. You can find his podcast links at https://www.thinknewfound.com/podcast.   He's a great guy, incredibly smart, and this is one cool conversation.  We hope you listen and enjoy!   Corey is the Co-Founder and Chief Investment Officer of Newfound Research, a quantitative investment manager.  Corey received his BS in Computer Science from Cornell University and his MS in Computational Finance from Carnegie Mellon University. 

In this episode Preston Pysh joins The Business Brew.  Preston needs no introduction in the financial podcast world.  But just in case... Preston Pysh is an authority in business, investing, and leadership. His business podcast is globally ranked #1 on iTunes for stock investing and numerous other categories. On Amazon, Preston is globally ranked as a top 100 business author. His work has been translated into numerous languages and he writes about international finance and central banking. His podcast, We Study Billionaires, has been downloaded millions of times per year. Preston has interviewed billionaire NBA sports team owners, Hedge Fund Managers, and global authorities in finance. His work has been featured on shows like The Colbert Report on Comedy Central, The History Channel, and many others. Preston is the founder of the Pylon Holding Company and he is a graduate of West Point and Johns Hopkins University. He was an AH-64D Attack Helicopter pilot and Company Commander with the 101st Airborne Division During Operation Enduring Freedom and he was awarded the Bronze Star Medal."    Bill used to listen to Preston when Preston co-hosted the Saturday "show" on The Investor's Podcast Network; We Study Billionaires (see https://www.theinvestorspodcast.com/we-study-billionaires/).  Bill has a habit of being late to ideas, so he was closed minded to Bitcoin while Preston made the case for Bitcoin.  Fortunately for Bill, he does usually realize when he might be wrong/stupid.  So, he invited Preston on The Business Brew to discuss Preston's transition from a "traditional value" investor to a Bitcoin bull.    Regardless of whether you, as a listener, agree with Preston's thesis, we hope you can learn a little about:   (a) how Preston thinks,  (b) what it took for him to make a macro/currency call, and  (c) the courage it took for him to make a call on something Buffett and Munger dismiss as silly.   We are grateful for him saying yes to coming on The Brew.  Props on the BTC call Preston.