The Business Brew

Kyle Cerminara - All In

Please see https://www.fgfinancial.com/corporate-overview/officers-directors/default.aspx for Kyle's official bio. Kyle "stopped by" The Business Brew to discuss his role as CEO of Fundamental Global. In that capacity, he is focused on four portfolio companies: Ballantyne Strong Inc, BK Technologies Corp, GreenFirst Forest Products Inc, and SPAC that reached a definitive agreement to purchase Opportunity Financial. Kyle has a very interesting background. He is mentioned in David Einhorn's book, Fooling Some of the People All of the Time, because he crossed paths with David on the Allied Capital trade. At that time, Kyle was a Financial Services analyst at T. Rowe Price. Following his stint at T. Rowe Price, Kyle worked at SAC. Following his time at T Rowe Price, Kyle founded Fundamental Global with his partner Joe Moglia. Together, they take control of companies and look to create long term shareholder value. In this episode, Kyle discusses why he does what he does, how he thinks about value creation, and what he is trying to accomplish. Bill and Kyle met when Mike Mitchell was The Business Brew's first guest. Since that time, Bill has watched Kyle work tirelessly to execute his plans. Consequently, Bill has grown to respect Kyle very much and wanted to feature Kyle as a guest. This episode may give a glimpse into a fantasy many investors seem to have: buying controlling interests in companies. Bill's conclusion is he would rather partner with Kyle and let Kyle do the heavy lifting of execution. Disclosure: Bill owns shares in 3 of Kyle's companies. He won't name which ones because he doesn't want people to read anything into his decisions. However, he will commit to hold every share for at least a year following this podcast episode.

2021-04-08
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Adam Robinson - A Unique Mind

Adam Robinson is the Co-Founder of The Princeton Review, a NY Times Best Selling author, and a US Chess Federation life master. He currently works as a global macro advisor to the heads of some of the world's largest hedge funds through Robinson Global Strategies. Bill has wanted to interview Adam since he heard Tim Ferris interview Adam at The 92nd St. Y. You can find one of his episodes with Tim Ferris at https://www.youtube.com/watch?v=oSyMmleisQM. See also Adam's interview with Shane Parrish at https://fs.blog/knowledge-project/adam-robinson-pt1/. Finally, Adam recently did a 4-hour interview with Kevin and Fred. See https://www.youtube.com/watch?v=sU_AM9VDgFs. In this episode, Bill follows up on some of the thoughts Adam gave Bill via various interviews. They start out talking about the concept of "things that are blatantly obvious and those that make no sense." This was one of the first concepts that Adam said where Bill said "wow, that's an interesting way to frame investing thoughts." Following that conversation, Bill follows up on many of the issues that he's wondered about as he's found as he's listened to Adam. This is a wide-ranging conversation that covers a lot of investing and some life. We hope you enjoy.

2021-04-01
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Sanjay Ayer - The Example of Self Awareness

Sanjay Ayer is a Portfolio Manager & Business Analyst at WCM; which he joined WCM in 2007. His primary responsibilities are portfolio management and equity research for WCM's global, fundamental growth strategies. Since he began his investment career in 2002, Sanjay?s experience includes a position as Equity Analyst at Morningstar, Inc. in Chicago. In this episode Sanjay "stops by" The Business Brew to have a candid conversation about what really matters in investing. Sanjay has spent a lot of time thinking about group think, the power of enabling analysts/talent to develop itself, spending time on the signal vs. noise, and many more important investment topics. Sanjay's "best" quality might be his modesty. He's clearly a very astute analyst and a clear thinker. However, he is incredibly humble, modest, and stresses the importance of self improvement. At one point Sanjay said "I think if we were to hire for one quality, it would probably be just a keen, keen self awareness." Please listen to this episode. And by listen, we mean really internalize what Sanjay says here. There are definitely important takeaways in this one. Thank you for being a guest Sanjay! Sanjay graduated Phi Beta Kappa from Johns Hopkins University (Maryland) with a B.A. in Economics and B.S. in Applied Mathematics.

2021-03-26
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Elliot Turner - Growth At A Reasonable Price Defined

Elliot Turner is a co-founder and Managing Partner, CIO at RGA Investment Advisors, LLC. RGA Investment Advisors runs a long-term, low turnover, growth at a reasonable price investment strategy seeking out global opportunities. Elliot focuses on discovering and analyzing long-term, high-quality investment opportunities, and strategic portfolio management. In this episode Elliot joins The Business Brew to discuss his days as a Phish podcast host, being a business analyst, his thoughts on the COVID 19 policy response, why he gained conviction through March 2020, Twitter, and creativity as an investor. Elliot is incredibly generous giving knowledge to the investment community and sharing his work. He's one of the investors Bill really admires. We hope you enjoy the conversation. Thank you for listening!

2021-03-18
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Liz Simmie - A True ESG Manager

Liz Simmie is the Co-Founder of Honeytree Investment Management, a firm that lives ESG investing. See the end of this description for Liz' official bio. In this episode Liz Simmie stops by The Business Brew to talk all things ESG. Unlike many "ESG" managers, Liz actually practices what she preaches. Said differently, Liz is the real deal and doesn't just use ESG as a marketing tool. The catalyst for this conversation was Bill thinking about morality in investing. On one hand, owning assets one is proud of seems like a reasonable goal. On the other hand, how do we draw the lines? If cigarettes are bad then why is sugar OK? If tobacco is bad why is alcohol OK? We cover a wide range of topics including: - how ESG is bastardized due to marketing - what real ESG investing looks like - why ESG is as important to Honey Tree - gender and racial diversity driving positive financial outcomes - issues preventing companies from embracing ESG policies - and much more. Bill's biggest takeaway was that ESG can provide a qualitative advantage for investment analysis. We are grateful for Liz' time and hope you enjoy the show. Thank you for listening! Bio: Liz is the co-founder of Honeytree Investment Management, an asset management firm focused on responsible growth, based in Toronto. Together with the team she manages Honeytree?s concentrated active investment strategies for institutional and private clients. Honeytree believes what is traditionally seen as ?ESG? data is just as important to assessing a company?s long term growth and risk as traditional fundamental data ? and they integrate them both equally in our investment process. Honeytree is proud to be one of the handful of female led responsible asset management firms globally leading the conversation. Prior to founding Honeytree she worked at Bristol Gate Capital Partners a leading active management firm, and before that she worked in quantitative market research for Ipsos. Liz has BA in Economic Statistics and History.

2021-03-11
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Ian Cassel - Micro Machine

Ian Cassel is the CIO at Intelligent Fanatics Capital Management ("IFCM"). IFCM invests in the smallest public companies in the world. They focus on businesses that are run by management teams who are capable of growing those businesses while benefiting stakeholders. Ian also founded MicroCapClub. In this episode Ian discusses how he became a microcap investor. One of his first successes was XM Satellite Radio. He discovered the company when it was a microcap trading for $2/sh and didn't have any contracts with car manufacturers yet. Ian saw they were presenting at a conference in NY, got in a car, and met with the CEO. After that meeting Ian became obsessed with turning into a full time private investor. Ian stresses the importance of doing deep due diligence, remaining rational, and keeping personal expenses "variable." He invests in a concentrated manner (only a few stocks at a time), which is very Buffett like. Unlike Buffett, however, Ian discusses the importance of remaining open to selling winners. This is because Ian is "fishing in a pond" of smaller companies and execution risk must always be monitored. Ian is a refreshing voice in the investment community and we are happy to have him join the show! Note: We reference Connor Haley's presentation in this discussion. That presentation can be found here

2021-03-04
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BONUS: Naufal Sanaullah - Inflation: Not So Certain

Naufal Sanaullah is the macro advisor at EIA Alpha Partners. EIA is a minority-owned firm that has realized very impressive results since inception. Among its many awards, EIA boasts the following (see https://eiaalphapartners.com/):

#1 Net Returns of Top Performing Relative Value Strategies Hedge Funds in 2019

#3 Net Returns of 2017-Inception Hedge Funds in 2019

#4 Net Returns of Top Performing Volatility Trading Hedge Funds in 2019

#5 Net Returns of Top Performing Hedge Funds in 2019 with Less than $100mn in AUM

#8 Net Returns of Top Performing North America-Based Hedge Funds in 2019

#16 Net Returns of Top Performing Hedge Funds in 2019

Naufal is responsible for macro strategy, macro trading, and overall portfolio management at EIA. Prior to EIA, he was involved in portfolio construction and macro strategy at Li Global Investors, a macro hedge fund in New York City. He studied mathematics at University of Michigan and Stony Brook University. His macro research has been highlighted in various media platforms, including Bloomberg, Business Insider, and Financial Times. He enjoys spending his free time producing hip-hop instrumentals and nurturing his puppy Nas. In this episode Naufal joins Bill to discuss Naufal's view on inflation, policy efficacy, and what to watch for going forward. Bill, historically an Austrian leaning investor, found it interesting to listen to Naufal describe his view of the world, which is far more Keynesian and could be called Modern Monetary Theory driven. The Business Brew is proud to feature this conversation for many reasons. One of which is the discussion is counter to the current market narrative/pricing on/of future inflation. If you like to consider both sides of an issue, this is a must listen macro episode. Also, please consider donating to https://www.publicolor.org/ if Naufal's message resonates with you.

2021-03-01
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Oren Falkowitz - No Phishing Way

Oren Falkowitz is the founder of Area 1 Security. He was Chief Executive Officer of Area 1 2013-2020 and currently serves on the Board of Directors. Mr. Falkowitz holds numerous patents and is an avid wearer of bow ties on Thursday. Previously, he was the founder of sqrrl (acquired by Amazon) and held positions at the National Security Agency (NSA) and United States Cyber Command (USCYBERCOM).

He joined the Business Brew to discuss his career and the cyber security landscape. We hope you enjoy.

2021-02-25
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Derek Walin - Entrepreneur and Music Maven

The Business Brew is pleased to feature Derek Walin, @walin on Twitter, this week. Derek is Bill's cousin. They grew up together and Bill has known Derek since he was born. As Derek grew, Bill watched him become the consummate entrepreneur. Derek began landing "gigs" as a magician. He would do magic for kids, elderly people, and anyone that would book him (by calling his parents). After that, Derek took a liking to DJing (before it was cool). He earned money throughout his high school years by DJing dances, birthday parties, and Bar and Bat Mitzvahs. Despite Derek's father having a corporate background, Derek knew college wasn't for him. Instead, he wanted to attend Full Sail and pursue his dreams of chasing a career in entertainment/music. Fast forward to today and Derek and his partners manage ~11 artists. Check out https://www.supermusicgroup.com/ and check out the artists on your favorite music app! As always, thank you for listening.

2021-02-18
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Moses Kagan - Permanent Real Estate Investing

Moses Kagan is a co-founder of Adaptive Realty, the Los Angeles-based real estate private equity firm. Since 2008, through Adaptive and predecessor entities, he has overseen the acquisition and rehabilitation of nearly 100 properties. Adaptive is laser focused on sub institutional scale multifamily. So these are deals between three and 10 million dollars of total capitalization. The firm is unusual in the real estate private equity world because they buy and hold real estate rather than buying buildings, fixing them up, and flipping them as is done in a more IRR driven model. In this episode Moses discusses his journey from running a smaller fund that had a single LP to what he does now. One of the most interesting parts of the conversation he discussed is when he had to sell the real estate in his first fund. To the outside world, it may have appeared to be a success. To Moses, however, it was a lesson in how much taxes hurt returns. That lesson formed the philosophy behind Adaptive. We are happy to have Moses as this week's guest. As always, we hope you enjoy the episode!

2021-02-11
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Bonus: Andrew Walker - A SPACtacular Conversation

Andrew Walker, a PM at Rangeley Capital, author of Yet Another Value Blog, and host of Yet Another Value Podcast stopped by to discuss SPACs and his investment philosophy. We are releasing this episode as a bonus because there are some elements of it that require a faster release than normal. Areas discussed were SPACs, sum of the parts analysis, Getting Better as an Investor, and the current market environment.

Andrew has had an interesting career. He's found "compounders," special situations, and everything in between. He won the 2017 Sohn Idea Contest (that's a big deal for those that don't know) when "La Quinta (LQ) is sold its franchise business to Wyndham and spun off its owned hotel portfolio into a new REIT (CorePoint) in a taxable spin." You can see his presentation here: https://docs.google.com/presentation/d/10t7lVjWmNkkm7jwunh46nMLvfVsS4tYgAJrNcFd7DRg/edit#slide=id.p3

We hope you enjoy this bonus episode.

2021-02-10
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Mike aka @NonGaap - Master of the Dark Arts of Corporate Governance

Mike is an ex-activist investor who writes about tech, corporate governance, the power of friction & incentives, strategy, interpersonal board dynamics, and activist fights. In this episode Mike and The Business Brew discuss everything from corporate governance to the potential for charismatic personalities to use their brand to make a run at real companies. Mike has a unique outlook on the world. Mike describes how the clues in corporate governance actions can help investors triangulate their ideas of valuation. At times, Mike will even use corporate governance changes as signals to initiate positions. For instance, he used clues to call a bottom on GrubHub shares and was correct. Join The Business Brew as we discuss how a different analytical lens can potentially help improve analysis and returns. But more importantly, listen to a unique mind talk about how he looks at the world. It was a pleasure to chat with Mike. A big thank you to Mathew Passy and his team for saving this episode.

2021-02-04
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Shomik Ghosh - A SaaSy Conversation

The Business Brew is joined by Shomik Ghosh. Mr. Ghosh is a Principal at Boldstart Ventures, a day one, pre-product partner for technical founders with portfolio companies such as Snyk, Kustomer, BigID, Superhuman, Front, and Security Scorecard.

His career has spanned everything from fixed income sales & trading to investment banking to venture capital. He specializes in enterprise software for his day job and long-term competitively advantaged businesses in his PA (a lot of which are also enterprise software companies ?).

Shomik has been trying to make Bill less stupid for almost two years now. He succeeded in this conversation. We are grateful for his time and appearance. Follow him on Twitter!

2021-01-29
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Jen Ross - Always Questioning the Narrative

The Business Brew is joined by Jen Ross this week. Jen was a professional short seller. Consequently, she has a unique perspective. It took Bill a while to understand the role of short selling in a portfolio but Jen?s comment about the need (or lack thereof) to hedge a quality equity portfolio really helped Bill understand what risks to think about hedging via short selling.

Her Bio very unique:

Jennifer L. Ross has more than 20 years of engineering and financial experience. She is a principal engineer in Launch and Enterprise Operations at The Aerospace Corporation.

Prior to joining Aerospace, Ross held management and executive positions in the areas of material science and manufacturing, process engineering, and financial analysis. Her focus is analyzing the space industrial base and helping space startups conduct business with the U.S. Space Force.

Ross transitioned from engineering to management consulting and finance in 2007. She spent five years as vice president of a public finance management and municipal bond firm. She later joined a hedge fund as an equity short seller/research analyst, analyzing corporate financials of publicly traded companies and predicting the probability of financial failure for those businesses. Ross joined Aerospace in 2015 when she saw the opportunity to combine her passions for both engineering and financial analysis.

2021-01-22
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Tyrone V Ross Jr. - A Powerful Advocate

We are fortunate to be joined by Tyrone V Ross Jr. What started out as a connection over BitCoin turned into something much more important. In this episode Tyrone discusses many issues that seem to be forgotten as the stock market hits new highs. We cover a wide range of issues and potential financial solutions.

We recommend listening to this one at 1x speed. As always, thank you for listening.

2021-01-15
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Sean Stannard Stockton - A Renaissance Investor

We were fortunate to be joined by Sean Stannard Stockton, CIO of Ensemble Capital Management. Sean is one of the best generalist investors we know of. In this episode, Sean discusses: Running an investment firm during COVID-19; The need for companies to lead by example; The willingness to remain open minded; Thinking about serial acquirers; The potential perils of low/slow growth investing; His thoughts on position sizing; And he provides the best answer we've ever heard to an error of omission. We hope you enjoy this episode. You can find our more about Ensemble Capital Management at https://ensemblecapital.com/?gclid=Cj0KCQiA3NX_BRDQARIsALA3fIJGBM5kcERDGlwpAcPWjR2UtW6FSQCOY_6cSvZx56ss1CpDyXBAP7kaAntGEALw_wcB.

2021-01-08
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Jack Rohrbach - A Success Story

This episode details the successful career of Jack Rohrbach. Jack began as a salesman and worked his way up. He made the most of every opportunity. While he often attributes his success to luck, it?s clear he was a team player who found out how to help those above him. In doing so, he became a leader. Our favorite quote of the interview occurred when Jack was talking about his later career. When asked how it felt to have a lot of employees working for him, he responded ?I don?t look at it that way. I always thought I worked for them.? This episode show what persistence, hard work, and an open mind can accomplish. Jack went on to be Chairman of the Board for 10 portfolio companies at Kohlberg & Co. We hope you enjoy this holiday edition of The Business Brew. Thank you for tuning in. Happy Holidays and Happy New Year.

2020-12-25
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Tobias Carlisle - A Modern Walter Schloss

Tobias Carlisle is a well known author. He's written extensively about value investing. In our view, Deep Value is one of the best investment books ever written.

He is also the founder and managing director of Acquirers Funds, LLC. See acquirersfunds.com

We hope this interview answers some of the tougher questions people have for him regarding ?value?s? underperformance. And, more importantly, we hope to introduce a really unique individual to the investing community.

We are grateful for his appearance on the pod.?

2020-12-11
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Dan McMurtrie - The Next Market Wizard

The second episode of The Business Brew features Dan McMurtrie, PM at Tyro Partners. In this episode Dan pulls back the curtain on how a true hedge fund manager thinks. He discusses: A tough launch (13:20) Pivoting from "value" investing (17:50) Agency costs hurting "value" investments (20:35) Convergent & iterative thinking (32:40) Risk management and buying higher (44:20) The dangers of the value investing inoculation (46:50) THE DATING PAPER (58:00) Being early on COVID (1:08:00) TINA + Liquidity Shortages + FOMO (1:22:11) Businesses as networks of people (1:37:45) The anointed companies (1:46:00) Inflection points and when it "gets simple" 1:54:00 When paying more can reduce risk (2:00:00) We are grateful to him for sharing his mind. Please enjoy the episode.

2020-11-27
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Michael Mitchell - Fundamental Opportunist

Welcome to the first episode of The Business Brew. Our first guest is Michael Mitchell. Michael is a former partner at Locust Wood Capital Advisors. He describes himself as 80% Greenblatt and 20% Buffett. Alternatively, he can be described as fundamental and opportunistic. Labels aside, he's a great thinker and a cool guy. So enjoy the episode and please subscribe to our feed.

2020-11-17
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