jerryking + investors   291

Family offices turn their attention to tech companies
December 2, 2019 | | Financial Times | by Javier Espinoza.

return comes from a few hyper-successful outliers. Investors should take a portfolio approach to have the best chance of “catching the winners”,
early-stage  Europe  family_office  high_net_worth  investors  technology  venture  capital  vc 
6 days ago by jerryking
Stock Market Drops. VCs Hold Partner Meetings. What Happens Next? | TechCrunch
So let me give you the news 2 months early. If the economy and the stock market continue to languish that’s exactly what’s going to happen.

I’ll bet most partners’ meetings this week consisted of looking just a little bit closer at the cash needs of their portfolio companies – making sure they’re “fully funded.” I’ll bet many of them did a review of their “investment pace” as in – how quickly should we be investing. I’ll bet many did a slow roll on deals that might have gotten approved today. Not a “no” but not yet a “yes.”

It’s impossible to sit in a partners’ meeting on a day like today without having an iPhone on watching the stock market free fall and no matter how much of a public tech cheerleader you are – privately I guarantee there was much concern.

If we do head South it will take a few weeks or months until the memos to portfolio companies get published and the Powerpoint presentations get sent out. But the internal conversation started today – trust me. VCs will take a “wait and see” approach right now. Don’t want to call it either way. It’s too early.
economic_downturn  economy  entrepreneurship  history  investors  technology  business  recessions  start_ups  vc  venture_capital  via:sha 
10 days ago by jerryking
Adventures in Corporate Venturing
January 1, 2001 / First Quarter 2001 / Issue 22 (originally published by Booz & Company)
Adventures in Corporate Venturing
A well-funded R&D program isn't enough. Corporations must invest in business opportunities outside their four walls to accelerate innovation and growth.
by Jill Albrinck, Jennifer Hornery, David Kletter, and Gary L. Neilson
corporate_investors  investors  start_ups  venture_capital  vc 
4 weeks ago by jerryking
The lesson for all investors arising from the lewd comments of a billionaire fund manager
OCTOBER 23, 2019 | The Globe and Mail | by IAN MCGUGAN

The money management industry that, in one way or another, is trying to seduce you.....The key to arriving at a mature relationship is seeing through the patter. Every fund company can trot out attractive, well-educated people with well-researched insights about the market. But look beyond the superficial charm.
More often than not, this will result in disappointment. The performance of most actively managed funds consistently lags passive market benchmarks, especially as you look at longer periods. In Canada, more than nine in every 10 funds underperformed their respective benchmarks over the 10 years to the end of 2018, according to S&P Dow Jones Indices.

In the United States, similar long-term trends hold true. Even the endowments of Ivy League universities, managed by teams of highly paid professionals, have failed to keep pace with a simple 60/40 portfolio of 60 per cent U.S. stocks and 40 per cent U.S. bonds over the past decade, according to research firm Markov Processes International. One simple lesson to take away from this is that indexing should be the default strategy for most small investors. Unless you have a strong view of where the market is going next, or a compelling reason to believe in a specific money manager, putting money into a low-cost, widely diversified index fund makes sense. No, it’s not going to work all the time – no investing strategy does – but it is hard to shrug off the long-term evidence of superior performance.

John Huber at Saber Capital Management, is often asked what his edge, or advantage, is. “Institutional investors seem especially interested in this question, and the edge that they are almost always looking for is some form of informational edge or insight that the rest of the market isn’t aware of,”......The problem is that such edges don’t exist any more. Oceans of financial and corporate information are available to any professional investor. Legions of professionals pore over that data, looking for reasons to buy or sell. Nobody knows more than anyone else – at least, not legally.......The only sustainable edge, Mr. Huber argues, is maintaining a different time horizon than the overall market.....
active_investing  commoditization_of_information  disappointment  index_funds  informational_advantages  investors  Ken_Fisher  lessons  money_management  passive_investing  slight_edge  time_horizons 
6 weeks ago by jerryking
Stephen Schwarzman: ‘I like to do things that are beautiful’
September 20, 2019 | Financial Times | by Lionel Barber.

Schwarzman’s fortune (net worth about $18bn) has bought him power and influence. He’s graduated from being a mega dealmaker to philanthropist, back channel in US-China relations and “Trump whisperer”. I want to explore these multiple roles, but also pin down why the man who has built one of the most successful financial businesses on the planet has never quite received the credit he believes he deserves......Blackstone started as a boutique advisory firm, with the goal of making enough money to start its own private equity fund. Private equity has attracted controversy because of alleged asset-stripping: buying companies, loading them with debt (“leverage”) and selling them off at a handsome profit, with favourable tax treatment.

Schwarzman casts himself as a long-term investor, not a scavenger in sheep’s clothing. He recounts with gusto the megadeals and the risk-taking involved in picking the right time to buy and sell assets, ranging from US Steel’s railroad network to the Waldorf hotel.

His skill is market timing. Blackstone has expanded into real estate and hedge funds and other “alternative assets”, with $545bn under management today. Blackstone funds are also the largest owner of real estate in the world. The firm’s rise epitomises the “buy side” revolution that favours asset managers at the expense of traditional banks trading liquid securities.

Schwarzman has written a book, which is part memoir, part Blackstone management primer called What It Takes: Lessons in the Pursuit of Excellence. (A better title would be Whatever It Takes, I suggest.) ......Blackstone is a meritocracy, he says, where two iron rules apply: no internal politics and do not lose money. “I go from the premise that anybody of talent does not want necessarily to be a private in an army. The lowest they want is to be a lieutenant colonel and preferably they’d all like to be generals.”......We turn to Schwarzman’s generous philanthropy. In recent years, he has donated $100m to the New York Public Library, $150m to Yale, £150m to Oxford university, $350m to MIT. He’s also set up the Schwarzman scholars, a one-year masters programme on global affairs for top international students to study at Tsinghua University in Beijing.
alternative_investments  Blackstone  books  dealmakers  investors  market_timing  philanthropy  private_equity  Stephen_Schwarzman  U.S.-China_relations 
11 weeks ago by jerryking
Momofuku’s Secret Sauce: A 30-Year-Old C.E.O.
Aug. 16, 2019 | The New York Times | By Elizabeth G. Dunn.

Momofuku was founded in 2004, with an East Village ramen bar that, after some initial stumbles, wowed diners by combining pristine ingredients and impeccable technique in humble dishes that melded influences from Japan to Korea to the American south. Since then, it has become a private-equity backed company with restaurants from Sydney to Los Angeles; a growing chain of fast-casual chicken sandwich shops; a media production unit churning out television shows and podcasts; and designs on creating a line of sauces and seasonings that could capture supermarket aisles across America. While Mr. Chang is the brand’s lodestar, Ms. Mariscal, 30, is the executive who makes it all work.

Born and raised on the Upper West Side, to the family that founded the specialty foods emporium Zabar’s, Ms. Mariscal began her career at Momofuku in 2011, as a public relations and events intern. Over the years, she quietly became Mr. Chang’s closest collaborator and confidante, a largely unknown force shaping matters as varied as menu design, branding and business development. “She’s the only person I’ve ever felt comfortable giving complete carte blanche to, in terms of what Momofuku looks like and what it should be,” Mr. Chang said. He recalled suggesting to the company’s board that Ms. Mariscal be named C.E.O. almost four years ago, when she was 26. She finally assumed the role in April.

It’s not unusual for a chef like Mr. Chang to parlay cooking talent and charisma into restaurants, cookbooks and television shows — a formula pioneered by the likes of Emeril Lagasse, Bobby Flay and Rick Bayless in the 1990s. But chef-driven food brands of the scope and ambition that Mr. Chang and Ms. Mariscal envision for Momofuku, with dozens of locations and mainstream packaged food products, are harder to pull off.

Adding to the challenge is Momofuku’s particular identity, which revolves less around a distinct culinary tradition than an attitude of restless innovation, boundary pushing and spontaneity. A formulaic chain of steakhouses, Momofuku ain’t. Scaling that ethos requires a tightrope act: Create enough structure and continuity to stave off chaos, without destroying the brand’s animating spirit in the process.
Asian  brands  branding  business_development  CEOs  chefs  commercial_kitchens  David_Cheng  detail_oriented  differentiation  diversification  food  founders  fusion  growth  high-standards  interns  investors  kitchens  leadership  Momofuku  organizational_structure  restauranteurs  restaurants  scaling  special_sauce  women  workaholic 
august 2019 by jerryking
13D / Our Approach
We are "Foxhogs".
The story of the fox and the hedgehog has been told in many forms through the ages, but the essence of it is always the same. The fox evades his attackers in a variety of inventive but exhausting ways, while the hedgehog adopts one tried and trusted strategy—hunkering down and letting its spikes do the work.

In the words of Greek poet Archilochus: “The fox knows many things, but the hedgehog knows one big thing.” Discussions of the hedgehog and the fox often come down to whether it’s better to be one or the other. But in a world that rewards expertise and the groundbreaking insights that come from the clash of domains, we need to be both. 13D is both.
foxes  hedgehogs  investment_research  investors 
august 2019 by jerryking
London Stock Exchange lays $27bn bet that data are the future
July 28, 2019 | | Financial Times | by Arash Massoudi, Richard Henderson and Richard Blackden.

The London Stock Exchange Group more than 300 years old, is trying to get back on the front foot with a plan for its most ambitious acquisition, one that will shape the direction of the group for years to come. It is the most striking demonstration yet of the charge among exchange operators into the business of supplying the data that is at the heart of markets....The LSE on Friday confirmed a Financial Times report that it was in talks to buy data and trading venue group Refinitiv for $27bn including debt, from a consortium led by private equity group Blackstone. If an agreement is reached for a company best-known for its Eikon desktop terminals, it would transform the LSE into a provider of financial market infrastructure and data with the scale to take on US exchange industry heavyweights Intercontinental Exchange and CME Group as well as Michael Bloomberg’s financial information empire.

“This would be a bold move in the shift among exchanges away from the matching of buyers and sellers and into the business of selling information,” said Kevin McPartland, head of market structure research at consultancy Greenwich Associates. “Data are so valuable and so is having the network of traders and investors to access that data — that’s all at play here.”......The deal would also be a defining moment for the LSE’s chief executive, David Schwimmer, just a year after the relatively unknown former Goldman Sachs banker was parachuted in to steady the ship. Its scale will bring considerable risk in execution alongside the need to convince LSE shareholders that taking on Refinitiv’s $12bn of debt will prove worth it.

Industry analysts see the strategic logic of the deal for the LSE, best known for its UK stock exchange and derivatives clearing house LCH. While revenue from initial public offerings can be more volatile, spending by everyone from asset managers to hedge funds on financial data and the analytical tools to make use of it has been going in one direction. It hit a record $30.5bn last year
.......“What’s happened is exchanges have found it more difficult to find ways of generating revenue in their traditional businesses,” “You can deliver data so easily now, there is voracious appetite from anyone making investment decisions so they can get an edge.”.....As well as winning over LSE shareholders, any deal is likely to face a lengthy period of antitrust approvals.

“There is a wider market concern about exchanges and data vendors combining,” said Niki Beattie, founder of Market Structure Partners. “The global world of data distribution is presided over by a small number of players who have a lot of power.”
asset_management  Blackstone  Bloomberg  bourses  data  financial_data  hedge_funds  inflection_points  IntercontinentalExchange  investors  LSE  mergers_&_acquisitions  M&A  Refinitiv  stockmarkets  Thomson_Reuters  tools  trading_platforms  turning_points  defining_moments 
july 2019 by jerryking
Andrea Illy: adapting a family business to a multinational world
JULY 20, 2019 | | Financial Times | by Rachel Sanderson.

*The coffee group chairman argues his style of capitalism is good for business, workers and the consumer*

Andrea Illy, third generation heir of the Illycaffè dynasty, last year struck an alliance with investment group JAB Holdings to produce and distribute Illy coffee capsules...he makes it clear that he does not intend to sell the closely held family company..... “It is a very simple principle about preserving our freedom,” he says of his and his family’s decision, one....Freedom is a word that comes up frequently in conversation with Mr Illy.....who espouses a sort of pick-and-mix version of capitalism, resolutely refusing to focus only on sales and profits. Illy argues his style of capitalism is not charity but good business.......Illy has paid its growers on average 30% more over market value for decades in order to maintain its supply of top Arabica beans. “....The company is rooted in the border city of Trieste....which is also ingrained in the nature of the family......globalisation and increasing competition in the coffee sector has forced Illy to adapt. Staying closely held does not work any more. Co-opetition is his new mantra."“It is like the way to adapt in the savannah. If you do not want to be prey to the big lion, you live in a tree.”"

Part of that adaptation has been the deal with JAB, which allowed Illy coffee capsules to be produced and distributed in supermarkets globally, something that Illy could not do alone......The global coffee industry has become increasingly like the beer tie-ups of the 1990s, with big groups such as JAB and Nestlé snapping up smaller companies. Illy has risked being squeezed between these behemoths and the microroasters emerging as the hip caffeine hit for millennials and Gen Z.....Bigger groups have circled Illy for years. Mr Illy says the family chose JAB because it had the technology he wanted and accepted a licensing agreement rather than an equity one.....To build its global presence, Mr Illy is now looking for a retail partner in the US to help launch Illy coffee bars in the world’s largest coffee market. He says he could even sell a slice of equity. But he is very specific who it would be to: a private financial investor, not an industrial group.....there have been other adaptations. Three years ago, Illy hired an outside chief executive — Massimiliano Pogliani, a former executive at Nestlé’s Nespresso — for the first time since the company was founded in 1933 by Mr Illy’s grandfather, Francesco. Mr Illy has also built a board including executives from clothing group Moncler and Italian cosmetics group Kiko...... studies show that family businesses often fail in the third generation. The move to hire outside management and governance comes as studies also show that family-owned, professionally-run companies are among the best performing in the long term. ......Mr Illy sees these alliances as the only way for a family business model to thrive and to not have to cede control to a multinational when “complexity is becoming too big for a single person to manage”.
.....good stewardship is good business......The Illy family is a supporter of arts and culture, including Trieste’s annual sailing regatta, the Barcolana, where hundreds of boats race across the bay. Mr Illy says this creates a virtuous circle: the more attractive Trieste becomes, the more talented people Illy can attract to work for it and the more visitors come to the city and raise its brand profile........A portrait of his father Ernesto hangs opposite his desk. “I put the painting there to ask him to control what I do,” Mr Illy says.

What, then, has he learnt from his family? “Society is made by the private sector, mostly. And if you want to improve society then we need to be able to pursue long-term goals which are beyond profitability, and then you have to be free and accountable only to yourself,” he says.

Three questions for Andrea Illy
Who is your leadership hero? I have three: Muhtar Kent, former chairman of Coca-Cola; my father; Sebastião Salgado [the photojournalist].

If you were not a CEO/leader, what would you be? A neurosurgeon.

What was the first leadership lesson you learnt? My father asked me when I turned 14 years old where I wanted to go to school. Do you want to start a journey to be a leader or do you want to have fun? I chose the first option and as a result chose boarding school in Switzerland over a local school at home. There I learnt about discipline and hard work but also about the power of a charismatic leader from my headmaster.
alliances  boards_&_directors_&_governance  climate_change  coffee  coopetition  dynasties  family  family_business  family-owned_businesses  financial_buyers  heirs  high-quality  Illycaffè  investors  JAB  licensing  Nestlé  premium  private_equity  privately_held_companies  stewardship  sustainability  the_counsel_of_the_dead  virtuous_cycles 
july 2019 by jerryking
Weston family hires OMERS managing partner Jim Orlando to invest $100-million in tech ventures
June 19, 2019 | Globe & Mail | by SEAN SILCOFF

Canada’s billionaire Weston family is making a $100-million bet on the emerging-technology sector, hiring away one of Canada’s top early-stage investment professionals from Ontario Municipal Employees Retirement System to run its new venture fund.

Jim Orlando, a managing partner with OMERS Ventures, will join a new arm of the Westons’ holding company, Wittington Investments, to develop “a meaningful corporate venture capital program and strategy...... he will focus on areas of innovation germane to the family’s key corporate interests: baking company Weston Foods, supermarket operator Loblaw Cos. Ltd. and drugstore chain Shoppers Drug Mart Corp., controlled by the Westons’ publicly traded conglomerate, George Weston Ltd.....Wittington has just two disclosed investments in Toronto’s emerging-technology sector, backing digital-health benefits provider League Inc. and venture-capital fund Radical Ventures. George Weston made its first investment in venture capital in 2016, backing a $25-million consumer-products-focused fund managed by Dragons’ Den star Arlene Dickinson, while Loblaw this year partnered with Toronto startup Flashfood Inc. to sell perishable food items nearing the end of their shelf lives through a mobile app.....he Westons join a small but growing group of wealthy families and corporations – including Telus Corp., Power Corp. of Canada, Royal Bank of Canada and OpenText Corp. – to invest in early-stage technology ventures.

Several real estate firms including Michael Cooper’s Dream Unlimited and Dream Office REIT and Cadillac Fairview Corp. Ltd. have committed tens of millions of dollars each to fund innovation in the property-tech market. Other Canadian “old economy” entrepreneurs – including mining magnate Seymour Schulich, property developer Robert Mantella, Vega nutritional supplement maker Charles Chang and Mission Hill Winery founder Anthony von Mandl – have emerged as big financiers of early-stage ventures in recent years.

“No question, [the Westons'] various companies are confronting a good number of significant opportunities and challenges, so there is no shortage of things to focus on,” said Rich Osborn, managing partner of Telus Ventures. “My caution would be, it’s easy to source and structure deals. The hard part is really unlocking the strategic value. That takes a lot more work and time to build that muscle. It will be a learning exercise for them for some time.”
corporate_investors  early-stage  family_office  George_Weston  investors  moguls  OMERS_Ventures  seed-stage  vc  venture_capital 
june 2019 by jerryking
How to funnel capital to the American heartland
April 15, 2019 | Financial Times | by Bruce Katz.
* The Innovation Blind Spot, by Ross Baird.
* Ways must be found to rewire money flows in order to reverse the export of wealth
* A federal tax incentive intended to entice coastal capital into the heartland may end up helping to keep local capital local.

Over the past year, economically distressed communities across the US have been engaged in an intense discussion about mobilising private capital. Why? As mayors, governors, real estate developers, entrepreneurs and investors have learnt, buried in the 2017 Tax Cuts and Jobs Act was a provision that created a significant tax incentive to invest in low-income “opportunity zones” across the country......the law’s greatest effect, ironically, has been to unveil a treasure trove of wealth in communities throughout the nation. Some of the country’s largest investors are high-net-worth families in Kansas City, Missouri, and Philadelphia; insurance companies in Erie, Pennsylvania, and Milwaukee; universities in Birmingham, Alabama, and South Bend, Indiana; philanthropists in Cleveland and Detroit; and community foundations and pension funds in every state.

These pillars of wealth mostly invest their market-oriented equity capital outside their own communities, even though their own locales often possess globally significant research institutions, advanced industry companies, grand historic city centres and distinctive ecosystems of entrepreneurs. The wealth-export industry is not a natural phenomenon; it has been led and facilitated by a sophisticated network of wealth management companies, private equity firms, family offices and financial institutions that have narrow definitions of where and in what to invest.

The US, in other words, doesn’t have a capital problem; it has an organisational problem. So how can capital flows be rewired to reverse the export of wealth?

Three things stand out:

(1) Information matters. The opportunity zones incentive has encouraged US cities to create investment prospectuses to promote the competitive assets of their low-income communities and highlight projects that are investor-ready and promise competitive returns.

(2) norms and networks matter. The opportunity zone market will be enhanced by the creation of “capital stacks” that enable the financing of community products such as workforce housing, commercial real estate, small businesses (and minority-owned businesses in particular) and clean energy, to name just a few. Initial opportunity zone projects are already showing creative blends of public, private and civic capital that mix debt, subsidy and equity.

(3) institutions matter. Opportunity zones require cities to create and capitalise new institutions that can deploy capital at scale in sustained ways. Some models already exist. The Cincinnati Center City Development Corporation, backed by patient capital from Procter & Gamble, has driven the regeneration of the Over-the-Rhine neighbourhood during the past 15 years.

More institutional innovation, however, is needed. As Ross Baird, author of The Innovation Blind Spot, has argued, the US must create a new generation of community quarterbacks to provide budding entrepreneurs with business planning and mentoring, matching them with risk-tolerant equity. These efforts will succeed if they unleash the synergies that flow naturally from urban density. New institutions will not have to work alone, but hand-in-glove with the trusted financial firms that manage this locally-generated wealth.
books  capital_flows  cities  coastal_elites  community  economic_development  economically_disadvantaged  economies_of_scale  high_net_worth  howto  industrial_policies  industrial_midwest  industrial_zones  institutions  investors  match-making  midwest  municipalities  networks  network_density  P&G  PPP  packaging  place-based  private_equity  property_development  prospectuses  Red_States  rescue_investing  rust_belt  tax_codes  venture_capital 
april 2019 by jerryking
The Missing Piece in Big Food’s Innovation Puzzle
April 1, 2019 | WSJ | by By Carol Ryan.

.......In truth, they are becoming reliant on others to do the heavy lifting. Specialist food ingredient companies like Tate & Lyle and Kerry Group work with global brands behind the scenes to come up with new ideas. These businesses can spend two to three times more on innovation as a percentage of turnover than their biggest clients.

One part of their expertise is overhauling recipes. Ingredients companies can do everything from adding trendy probiotics to taking out excess sugar or gluten. Nestlé got a hand from Tate & Lyle to remove more sugar from its Nesquik range of flavored drinks, while Denmark’s Chr. Hansen helped Kraft Heinz switch from artificial to natural colors in the U.S. giant’s Macaroni & Cheese......Another service food suppliers offer is coming up with successful innovations to help revive sales. Nestlé’s ruby chocolate KitKat, which has become very popular in Asia, was actually created by U.S. cocoa producer Barry Callebaut, for example.

=============================================
See also, "For innovation success, do not follow the money"
07-Nov-2005 | Financial Times | By Michael Schrage "There is
no correlation between the percentage of net revenue spent on R&D
and the innovative capabilities of an organisation – none,"...Just ask
General Motors. No company in the world has spent more on R&D over
the past 25 years. Yet, somehow, GM's market share has
declined....R&D productivity – not R&D investment – is the real
challenge for global innovation. Innovation is not what innovators
innovate, it is what customers actually adopt. Productivity here is not
measured in patents granted but in new customers won and existing
customers profitably retained..
customer_profitability  Big_Food  brands  flavours  food  foodservice  health_foods  healthy_lifestyles  ingredients  ingredient_diversity  innovation  investors  Kraft_Heinz  large_companies  Mondelez  Nestlé  new_ideas  R&D  shifting_tastes  start_ups  Unilever 
april 2019 by jerryking
The need for weed: why Wall Street is getting hooked on cannabis
MARCH 15, 2019 | Financial Times | by Nicole Bullock in New York.

a “sea change in attitude” towards the sector.  “You don’t get an opportunity every day to participate in the very early stages of the creation of a large global industry and that is what is happening now,”
Aurora  Cambrian_explosion  cannabis  Canopy_Growth  FDA  investors  start_ups  Wall_Street 
march 2019 by jerryking
Michael Moritz, the tech investor backing books
March 1, 2019 | Financial Times | by Richard Waters.

Michael Moritz, the biggest individual investor in funds managed by Sequoia Capital, the blue-chip venture capital firm where he has worked since 1986. Forbes estimates his wealth at $3.4bn, but Moritz himself puts it “a bit higher”.

Some of that wealth was put to work this week when Crankstart, the charity he set up with his wife, Harriet Heyman, agreed to provide financial backing for the Booker Prize, one of the top awards for English language fiction, for the next five years......Moritz continues to court controversy, writing approvingly in the Financial Times of the relentless pace of Chinese tech start-ups, where workers put in so many hours they barely see their children. He contrasted them with “soul-sapping” debates about work/life balance in the US, calling them “concerns of a society that is coming unhinged”.

It is tempting to ascribe his success as an investor to tireless networking, luck and timing....entrepreneur Randy Adams tipped him off to Yahoo, which was creating one of the first web indices. That led him to Google. He took over leadership of Sequoia from Don Valentine — one of Silicon Valley’s first start-up investors — in the mid-1990s.

The firm then moved well beyond its venture capital roots, setting up arms to manage family endowments and handle public market investments. While he was at the helm, it became the most successful foreign start-up investor in China. “We understood that the world had changed and that Silicon Valley was not going to be the centre of the universe for the next 50 years,”....he still works full time making investments and sits on 10 corporate boards.

Through Crankstart, Sir Michael and his wife have made substantial gifts to education, including £75m in 2012 to fund scholarships for the poorest students at Oxford university, where he was an undergraduate. He said that the financial support his father had been given after fleeing Nazi Germany as a teenager was his motivation.....After funding some of the world’s most disruptive companies, it might seem perverse that Sir Michael is now backing something as traditional as a literary prize. But he says: “Like music and video, I think the future is brighter than the past.” Printed book sales are rising again, and audio books allow readers to consume them in new forms. “The novel is the underpinning of many forms of entertainment,” he says. “I don’t think anyone’s lost their appetite for good storytelling.”
books  charities  contrarians  Don_Valentine  fiction  Google  investors  Man_Booker  Michael_Moritz  Oxford  novels  philanthropy  prizes  Richard_Waters  Sequoia  sponsorships  venture_capital  vc  Yahoo 
march 2019 by jerryking
Store wars: short sellers expect more pain in US retail
February 26, 2019 | Financial Times | by Alistair Gray in New York.

Short sellers who made big bets against US retailers a couple of years ago had hoped for carnage across the board. No one could compete with the rise and rise of Amazon...which would make life hard for every mall tenant across America.

But after a period in which internet shopping seemed to hit almost every brick-and-mortar retailer, the industry seems to be dividing into winners and losers. Casualties are still piling up: bankruptcies since the turn of the year....Payless Shoes ....Sears, the once dominant department store chain, narrowly avoided outright liquidation.

However, some of the biggest companies e.g. Walmart & Best Buy are reporting their healthiest metrics in years......For short sellers trying to profit from falling share prices, it makes for a perilous environment.

“It’s a slow death by a thousand paper cuts, and not the kind of ‘mall-mageddon’ originally anticipated by that trade,”.....“Retail has been much more volatile than many would have expected. It hasn’t been decidedly one way down.”....an over-reaction in 2017 and that led to pretty nice opportunities [for longs] in 2018,”.....Investors who put money on the demise of retail that summer have lost out in many cases......It was almost as if they [shorts] were acting like no retail real estate space can work,” ....overcapacity doesn’t mean retail real estate is dead.”...Shares in the sector have been volatile in part because investors have had to consider a series of seemingly contradictory data points about the health of both the US consumer and the retail business.....Traditional chains are also trying to take on Amazon by improving their online offerings and making their stores more enticing. Both require hefty investment, although successful examples include Lululemon, which offers yoga lessons in its stores. Shares in the company have tripled since a 2017 low.

“Those who are innovating and investing in ecommerce, marketing and social media tend to be doing well...“The US is still over-stored,” ...Ecommerce meant “more of the store base is not economic. That’s going be a secular pressure for years to come. For those retailers that don’t have a digital strategy, it’s just a matter of time before they fall.”
Amazon  apocalypses  bankruptcies  barbell_effect  bear_markets  bricks-and-mortar  commercial_real_estate  death_by_a_thousand_cuts  department_stores  digital_strategies  e-commerce  innovation  investors  investment_thesis  Lululemon  pain_points  overcapacity  retailers  shopping_malls  short_selling  structural_decline  Wal-Mart 
february 2019 by jerryking
JAB’s Peter Harf: hire ambitious talent and give them a mission
February 16, 2019 | | Financial Times | by Leila Abboud and Arash Massoudi.

JAB oversees its portfolio of coffee, beverages, and casual dining companies. .....When everything was going wrong last year at Coty, the cosmetics company backed by investment group JAB Holdings, Peter Harf reacted with characteristic ruthlessness, replacing Coty’s chief financial officer and chief executive, and taking back the Coty chairmanship from his longtime associate, Bart Becht. Describing last year’s share price decline of more than 60% as “unacceptable” for JAB and its co-investors, Mr Harf says the situation “had to have serious consequences” even for his inner circle......Harf believes that identifying talented people — and incentivising them through performance-based pay — have been key to his success over his nearly 40-year career..... just as important to Harf is knowing when to jettison those who are no longer serving the mission he has overseen since he was 35: growing the wealth of Germany’s reclusive Reimann family who are behind JAB....Harf's vision was for JAB to be modelled on Berkshire Hathaway, the investment conglomerate built by his idol, Warren Buffett. Success would come not only from backing the right leaders but by patiently building brands, embarking on deals and taking companies public to cash in on bets....Harf felt he had assembled a dream team: “My mantra has always been that I need to hire people who are better than me. Lions hire lions and sheep hire other sheep.”

Three questions for Peter Harf
(1) Who is your leadership hero?

“Warren Buffett. Hands down. All this stuff that I intend to do to make JAB into a long-term investment vehicle, he does it to perfection. He’s the greatest investor in the world, and I want to be like him. If we invest as well as Warren, we’ve won. Very simple.”

(3) What was your first leadership lesson?

One of my biggest role models was Bruce Henderson, the founder of Boston Consulting Group. When I worked for him, I prepared a three-page analysis about a problem. It had 10 bullet points as the conclusion. He dismissed it as way too complicated and said: “Don’t try to field every ball.” He meant that if you wanted to be a good leader, you have to be able to focus on the important stuff first.
+++++++++++++++++++++++++++++++++++++++++++++++++++
The trouble often starts when leaders start listing five or seven or 11 priorities. As Jim Collins, the author of the best-selling management books “Good to Great” and “Built to Last,” is fond of saying: “If you have more than three priorities, you don’t have any.”
BCG  Berkshire_Hathaway  beverages  casual_dining  coffee  commitment  CPG  dealmakers  deal-making  departures  exits  family_office  family-owned_businesses  HBS  hiring  investors  JAB  Keurig  lifelong  mission-driven  private_equity  portfolio_management  ruthlessness  talent  troubleshooting  Warren_Buffett 
february 2019 by jerryking
When Charlie Munger Calls, Listen and Learn
Jan. 25, 2019 | WSJ | By Jason Zweig.

Mr. Munger was calling to say that he had read the novel Mr. Taylor was about to self-publish, “The Rebel Allocator.” He was “surprisingly engaged,” recalls Mr. Taylor, 37, who had sent the book to Mr. Munger without much hope the great investor would read it. Mr. Munger proceeded to reel off roughly 20 minutes of unsolicited, detailed advice, mostly about plot and character.

In an interview, Mr. Munger tells me he tends to “skim” or “at least give some cursory attention” to any book that mentions Berkshire Hathaway......“The Rebel Allocator” is the opposite of most business novels. Here, the rich capitalist isn’t an evil genius using genetic engineering to hijack the brains of newborn babies. Instead, he is a hero: an investing mastermind who regards allocating capital as a noble calling that improves other people’s lives.

In the novel, a business student named Nick is on a field trip with his MBA class when he meets a 77-year-old billionaire, Francis Xavier, a restaurant mogul also known as “the Rebel Allocator” and “the Wizard of Wichita.”

Blunt and bristly, with zero tolerance for stupidity, Mr. Xavier spouts proverbs and zingers. A mash-up of Mr. Munger and Mr. Buffett, he often invokes their ideas.

Taking a shine to Nick, Mr. Xavier asks him to write his biography. Like many young people today, Nick wonders if becoming a billionaire is inherently immoral when poverty is still widespread.

Mr. Xavier teaches Nick what separates great businesses from good and bad ones. He uses three drinking straws, labeled “cost,” “price” and “value,” to demonstrate: When a business can charge a higher price than its goods or services cost, the difference is profit. When the value its customers feel they get is greater than price, that difference is brand or pricing power—the ability to raise prices without losing customers.

As Mr. Xavier moves the straws around, Nick learns that investing decisions can make the world a better place: “Good capital allocation means doing more with less to create happier customers,” says Mr. Xavier. “Profit should be celebrated as a signal that an entrepreneur provided value while consuming the least amount of resources to do so.”
asset_management  Berkshire_Hathaway  books  capital_allocation  Charlie_Munger  fiction  intrinsic_value  investing  investors  Jason_Zweig  novels  Warren_Buffett 
january 2019 by jerryking
How the 0.001% invest - Investing and the super-rich
Dec 15th 2018

Global finance is being transformed as billionaires get richer and cut out the middlemen by creating their own “family offices”, personal investment firms that roam global markets looking for opportunities. Largely unnoticed, family offices have become a force in investing, with up to $4trn of assets—more than hedge funds and equivalent to 6% of the value of the world’s stockmarkets. As they grow even bigger in an era of populism, family offices are destined to face uncomfortable questions about how they concentrate power and feed inequality......Every investment boom reflects the society that spawned it. ....The rise of family offices reflects soaring inequality......But since the financial crisis there has been a loss of faith in external money managers. Rich clients have taken a closer look at private banks’ high fees and murky incentives, and balked......Family offices’ weight in the financial system....looks likely to rise further. As it does, the objections to them will rise exponentially....that family offices have created inequality. They are a consequence, not its cause. Nonetheless, there are concerns—and one in particular that is worth worrying about: (1) The first is that family offices could endanger the stability of the financial system. (2) The second worry is that family offices could magnify the power of the wealthy over the economy.(3) that family offices might have privileged access to information, deals and tax schemes, allowing them to outperform ordinary investors.

The answer is vigilance and light. Most regulators, treasuries and tax authorities are beginners when it comes to dealing with family offices, but they need to ensure that rules on insider trading, the equal servicing of clients by dealers and parity of tax treatment are observed. And they should prod family offices with assets of over, say, $10bn to publish accounts detailing their workings. In a world that is suspicious of privilege, big family offices have an interest in boosting transparency. In return, they should be free to operate unmolested.
diversification  family_office  finance  financial_system  investing  investors  money_management  the_One_percent  upper_echelons  high_net_worth 
january 2019 by jerryking
The Oracle of Boston - Seth Klarman
Jul 7th 2012 | Boston

A scanned version of “Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor” has been circulating around trading floors. One hedgie likens Mr Klarman's book to the movie “Casablanca”: it has become a classic......Mr Klarman still runs Baupost like a family office. He is extremely risk averse; his primary goal is not stellar returns but preservation of capital.......He has deliberately maintained a sticky investor base composed almost entirely of endowments, foundations and families, which understand his investment philosophy and will not redeem after a few negative quarters.
Boston  hedge_funds  investors  investing  margin_of_safety  Seth_Klarman  value_investing/investors  books  Baupost  family_office 
january 2019 by jerryking
JAB chair Bart Becht quits in split with partners
January 14, 2019 | Financial Times | Leila Abboud in Paris and Arash Massoudi.

Bart Becht's departure is the first outward display of tensions within JAB, created to manage the wealth of Germany’s billionaire Reimann family. The chairman of JAB Holdings, the acquisition-hungry owner of Pret A Manger and Keurig Dr Pepper, has quit after a five-year $50bn takeover spree led to a split with his two partners over the scale of the investment group’s dealmaking.

According to two people with direct knowledge of his decision, Bart Becht, a hard-charging 62-year-old consumer industry executive, stepped down after failing to convince JAB to scale back its takeover ambitions to focus on improving operations at its sprawling portfolio of companies.....The once-obscure investment vehicle has vaulted itself into the top tier of consumer products groups through acquisitions of high-profile US brands like Krispy Kreme, Peet’s Coffee and Covergirl owner Coty, competing directly with industry giants including Nestlé and Coca-Cola in coffee and L’Oreal in make-up......One person who has worked closely with JAB described Mr Becht’s decision as “undoubtedly a surprise”, especially since the trio of executives had only recently been raising money from outside investors and pitching themselves as long-term investors.

JAB operates in a similar way to a private equity investor, but with much longer time horizons. It is often willing to own portfolio companies for decades, often engineering an expansion via acquisitions.....The fundraising also coincided with a strategy shift as JAB exited investments in luxury and fashion to focus on what it calls premium food and beverage, casual dining, and coffee.
CPG  dealmakers  departures  exits  family_office  family-owned_businesses  hard-charging  investors  JAB  Keurig  private_equity  portfolio_management  time_horizons 
january 2019 by jerryking
How a Former Canadian Spy Helps Wall Street Mavens Think Smarter
Nov. 11, 2018 | The New York Times | By Landon Thomas Jr.

* “Atomic Habits: An Easy and Proven Way to Build Good Habits and Break Bad Ones,” by James Clear. “
* “The Laws of Human Nature,” an examination of human behavior that draws on examples of historical figures by Robert Greene.
* “Thinking in Bets: Making Smarter Bets When you Don’t Have All the Cards” by Annie Duke,
* “On Grand Strategy,” an assessment of the decisions of notable historical leaders by the Pulitzer Prize-winning biographer John Lewis Gaddis

Shane Parrish has become an unlikely guru for Wall Street. His self-improvement strategies appeal to his overachieving audience in elite finance, Silicon Valley and professional sports.....Shane Parrish is a former cybersecurity expert at Canada’s top intelligence agency and an occasional blogger when he noticed something curious about his modest readership six years ago: 80 percent of his followers worked on Wall Street......The blog was meant to be a method of self-improvement, however, his lonely riffs — on how learning deeply, thinking widely and reading books strategically could improve decision-making skills — had found an eager audience among hedge fund titans and mutual fund executives, many of whom were still licking their wounds after the financial crisis.

His website, Farnam Street, urges visitors to “Upgrade Yourself.” In saying as much, Mr. Parrish is promoting strategies of rigorous self-betterment as opposed to classic self-help fare — which appeals to his overachieving audience in elite finance, Silicon Valley and professional sports. ....Today, Mr. Parrish’s community of striving financiers is clamoring for more of him. That means calling on him to present his thoughts and book ideas to employees and clients; attending his regular reading and think weeks in Hawaii, Paris and the Bahamas; and in some cases hiring him to be their personal decision-making coach......“We are trying to get people to ask themselves better questions and reflect. If you can do that, you will be better able to handle the speed and variety of changing environments.”....Parrish advises investors, to disconnect from the noise and to read deeply......Few Wall Street obsessions surpass the pursuit of an investment edge. In an earlier era, before computers and the internet, this advantage was largely brain power. Today, information is just another commodity. And the edge belongs to algorithms, data sets and funds that track indexes and countless other investment themes.......“It is all about habits,” “Setting goals is easy — but without good habits you are not getting there.”......“Every world-class investor is questioning right now how they can improve,” he said. “So, in a machine-driven age where everything is driven by speed, perhaps the edge is judgment, time and perspective.”
books  Charlie_Munger  coaching  commoditization_of_information  CSE  cyber_security  decision_making  deep_learning  disconnecting  financiers  gurus  habits  investors  judgment  life_long_learning  overachievers  personal_coaching  perspectives  Pulitzer_Prize  questions  reading  reflections  self-betterment  self-improvement  slight_edge  smart_people  Wall_Street  Warren_Buffett 
november 2018 by jerryking
Howard Marks, the ultimate bargain hunter
October 17, 2018 | Financial Times | Javier Espinoza.

Howard Marks : “I have a high degree of creativity,” he says. "In order to outdo others you have to think differently from others. If you don’t, how can you expect to have superior results?” His new book is Mastering the Market Cycle.

Mr Marks is the founder of Oaktree Capital Management. Based in Los Angeles, it is one of the world’s most prominent value investors. He makes money by finding situations where he can buy low, especially distressed assets, then sell high.

Today, market conditions mean Mr Marks faces as strong a challenge as ever: trying to sniff out bargains when valuations are steep, debt is cheap and competition fierce.

In 2015 Oaktree raised about $12bn for its distressed-debt fund. It was the second-largest amount in its history......The veteran financier regards delaying gratification as key to success. Like Warren Buffett, he believes waiting for the right investments is an important part of the process.

He often cites Hyman Minsky, the US economist famous for his work on bubbles and crashes....as Minsky would say, ‘there are always cycles’.”

“There are up-cycles with too much enthusiasm, too little discipline and too little risk aversion," he says. "And there are down-cycles when the economy does less well, corporations do less well, security prices fall and there is too much risk aversion, too much fear.”

“A quote said to have been uttered by Mark Twain is: ‘History does not repeat but it does rhyme’. The point is that the patterns of cycles do repeat and the details – the amplitude, the timing, the duration, the speed and the reasons – are different from cycle to cycle but the themes that underlie the causes of cycles are similar from one to the next.”

 
books  distressed_debt  economic_cycles  financiers  Howard_Marks  investors  Mark_Twain  moguls  money_management  investment_research  value_investing/investors  Oaktree  founders 
october 2018 by jerryking
Offering Inspiration and Advice, Real Vision Is HGTV for Hedge Fund Hopefuls - The New York Times
By Landon Thomas Jr.
Oct. 2, 2018

Real Vision offers a way to skip the traditional hedge fund path: slog away at an investment bank or a mutual fund, then settle down in Midtown Manhattan or Greenwich, Conn. For a modest fee, Real Vision will connect investors to a network of elite Wall Street analysts, traders and hedge fund managers, making it easier for novices like Mr. O’Dea to jump the line.

Raoul Pal, a former hedge fund executive who also worked at Goldman Sachs and runs an investment strategy service called Global Macro Investor, co-founded Real Vision. Since then, 20,000 people have signed up, paying $180 a year to hear directly from financial insiders.

It is a vibrant community with an average age of 38, which distinguishes it from CNBC and its more mature audience. Mixing the Netflix payment model with a cozy interview style, Real Vision offers to help upstart investors decode the mysteries of today’s markets. It features those insiders presenting their views in lengthy, explanatory videos: How to short China, the long-term opportunities in emerging markets and the best way to play Bitcoin, among others.
hedge_funds  television  inspiration  subscriptions  investors  explanatory 
october 2018 by jerryking
3 Investments That May Have Hit Their Peak - The New York Times
By Paul Sullivan
Sept. 14, 2018

Dan Rasmussen, a contrarian investor and the founding partner of Verdad Capital in Boston, has written an article and two reports that make a case against investments in three of the most popular asset classes for high-net-worth investors: private equity, venture capital and private real estate. He has piles of data to back up his argument.
asset_classes  high_net_worth  investors  Michael_Sonnenfeldt  private_equity  real_estate  Tiger21  venture_capital  wealth_management 
september 2018 by jerryking
Paul Singer, Doomsday Investor
August 27, 2018 | The New Yorker | By Sheelah Kolhatkar.

Paul Singer, ,
The head of hedge fund Elliott Management, has developed a uniquely adversarial, and immensely profitable, way of doing business.

Bush had co-founded Athenahealth, a platform that digitizes patient medical records and billing claims for hospitals and health-care providers, in 1999, and he had built it into an enterprise with more than a billion dollars in revenue. One of the firm’s marketing taglines was that it freed doctors and nurses to spend more time doing what they loved—practicing medicine—and less time on paperwork. Athena served more than a hundred thousand health-care providers...... Paul Singer, the founder of Elliott Management and one of the most powerful, and most unyielding, investors in the world. Singer, who is seventy-three, with a trim white beard and oval spectacles, is deeply involved in everything Elliott does. The firm has many kinds of investments, but Singer is best known as an “activist” investor, using his fund’s resources—about thirty-five billion dollars—to buy stock in companies in which it detects weaknesses. Elliott then pressures the company to make changes to its business, with the goal of improving the stock price.....Hedge funds, especially activist hedge funds, are established users of private-investigation services.....The investor acknowledged that Bush was far from perfect, and said that “there is a role for activists to hold managements accountable.” But the investor worried that the focus on the bottom line would undermine the innovative spirit that had made Athena successful. “.....The idea that companies exist solely to serve the interests of shareholders—rather than also to serve workers, customers, and the larger community—has been dominant in the business world in the past thirty years. As the field of activist investing becomes increasingly crowded, many investors are going beyond their original mission of finding ailing or mismanaged companies and pushing them to improve. Instead, some have been targeting larger, financially prosperous companies, such as Procter & Gamble, Apple, and PepsiCo. ......Often, activists advocate for measures that drive up the stock price but can have negative effects in the future, such as the outsourcing of jobs, the elimination of research and development, and the borrowing of money to buy back a company’s own stock. The wisdom of these tactics has come under increasing scrutiny. Some of the most successful businesses to emerge in recent decades have staved off short-term pressures, forcing their investors to be patient with uncertainty and experimentation. The founder of Amazon, Jeff Bezos, wrote in an early investor letter that building something new “requires you to experiment patiently, accept failures, plant seeds, protect saplings.” ........Over time, this lack of long-term vision alters the economy—with profound political implications. Businesses are the engine of a country’s employment and wealth creation; when they cater only to stockholders, expenditures on employees’ behalf, whether for raises, job training, or new facilities, come to be seen as a poor use of funds. Eventually, this can result in fewer secure jobs, widening inequality, and political polarization. ..........Bush spoke about his last day in the office, when he had sobbed during his final address to Athena’s employees. He had also written a farewell letter. “I believe that working for something larger than yourself is the greatest thing a human can do. A family, a cause, a company, a country—these things give shape and purpose to an otherwise mechanical and brief human existence,” the letter read. “The downside about things that are larger than ourselves, of course, is that we who have the privilege of serving them ourselves are fungible. It is the fundamental definition. You can’t have the grace of the one without the other......Throughout our conversations, Bush returned to a theme that consumed him. He talked about how investors like Singer—financiers who take the assets built by others and manipulate them like puzzle pieces to make money for themselves—are affecting the country on a grand scale. A healthy country, he said, needs economic biodiversity, with companies of different sizes chasing innovation, or embarking on long, hard projects, without being punished. The disproportionate power of the Wall Street investor class, Bush felt, dampened all that, and gradually made the economy, and most of the people in it, more fragile.
distressed_debt  Elliott_Management  financiers  hard_goals  hard_work  hedge_funds  investors  long-term  patience  Paul_Singer  profile  shareholder_activism  Sheelah_Kolhatkar  time_horizons  vulture_investing  Wall_Street 
august 2018 by jerryking
How Financial Products Drive Today’s Art World
July 20, 2018 | The New York Times | By Scott Reyburn.

How does one invest in art without going through the complications of buying and owning an actual artwork?

That is the question behind financial products for investors attracted by soaring art prices but intimidated by the complexity and opacity of the market..... entrepreneurs are trying to iron out the archaic inefficiencies of the art world with new types of financial products, particularly the secure ledgers of blockchain...... “More transparency equals more trust, more trust equals more transactions, more transactions equals stronger markets,” Anne Bracegirdle, a specialist in the photographs department at Christie’s, said on Tuesday at the auction house’s first Art & Tech Summit, dedicated to exploring blockchain......blockchain’s decentralized record-keeping could create a “more welcoming art ecosystem” in which collectors and professionals routinely verify the authenticity, provenance and ownership of artworks on an industrywide registry securely situated in the cloud...... blockchain has already proved to be a game-changer in one important area of growth, according to those at the Christie’s event: art in digital forms.

“Digital art is a computer file that can be reproduced and redistributed infinitely. Where’s the resale value?”.....For other art and technology experts, “tokenization” — using the value of an artwork to underpin tradable digital tokens — is the way forward. “Blockchain represents a huge opportunity for the size of the market,” said Niccolò Filippo Veneri Savoia, founder of Look Lateral, a start-up looking to generate cryptocurrency trading in fractions of artworks.

“I see more transactions,” added Mr. Savoia, who pointed out that tokens representing a percentage of an artwork could be sold several times a year. “The crypto world will bring huge liquidity.”......the challenge for tokenization ventures such as Look Lateral is finding works of art of sufficient quality to hold their value after being exposed to fractional trading. The art market puts a premium on “blue chip” works that have not been overtraded, and these tend to be bought by wealthy individuals, not by fintech start-ups.....UTA Brant Fine Art Fund, devised by the seasoned New York collector Peter Brant and the United Talent Agency in Los Angeles.

The fund aims to invest $250 million in “best-in-class” postwar and contemporary works,...Noah Horowitz, in his 2011 primer, “Art of the Deal: Contemporary Art in a Global Financial Market,”.... funds, tokenization and even digital art are all investments that don’t give investors anything to hang on their walls.

“We should never forget that in the center of it all is artists,”
art  artists  art_advisory  art_authentication  art_finance  auctions  authenticity  best_of  blockchain  blue-chips  books  Christie's  collectors  conferences  contemporary_art  digital_artifacts  end_of_ownership  fin-tech  investing  investors  opacity  post-WWII  provenance  record-keeping  scarcity  tokenization  collectibles  replication  alternative_investments  crypto-currencies  digital_currencies  currencies  virtual_currencies  metacurrencies  art_market  fractional_ownership  primers  game_changers 
july 2018 by jerryking
The AI arms race: the tech fear behind Donald Trump’s trade war with China | Financial Times
Shawn Donnan in Washington YESTERDAY

While the headlines about the Trump administration’s trade war with Beijing often focus on raw materials such as steel, aluminium and soyabeans, the underlying motivation of the new protectionist mood is American anxiety about China’s rapidly growing technological prowess.......
At a time when the US is engaged in a battle for technological pre-eminence with China, the ZGC project is exactly the sort of state-backed Chinese investment that American politicians across the political spectrum view with scepticism.

“China has targeted America’s industries of the future, and President Donald Trump understands better than anyone that if China successfully captures these emerging industries, America will have no economic future,” .....US tariffs on $34bn in imports from China that are due to take effect on Friday as part of a squeeze intended to end what the US says has been years of state-endorsed Chinese intellectual property theft. But it is also part of a broader battle against what the White House has labelled China’s “economic aggression”......Viewed from America, President Xi Jinping’s Made in China 2025 industrial strategy is a state-led effort to establish Chinese leadership in the technologies of the next generation of commerce and military equipment — notably AI, robotics and gene editing.

Many US officials are now questioning one of the basic assumptions about how the American economy operates: its openness to foreign investment....While some technology executives extol the potential for co-operation in areas such as AI, the Washington establishment increasingly sees them as central to a growing geopolitical competition....Many Chinese investors are looking for US companies that they can help move into China. .....Even though Mr Trump’s focus on Chinese technology has strong bipartisan support in Washington, its tactics have been heavily criticised. The biggest blunder, many critics argue, has been the Trump administration’s willingness to wage concurrent trade wars. The IP-driven tariffs push against China has been accompanied by one that has hit allies such as Canada and the EU that might have joined a fight against Beijing.

........“We’re treating the Chinese better than we are treating our friends,” says Derek Scissors, a China expert at the conservative American Enterprise Institute, who sees the tariffs Mr Trump is threatening against European car imports as a similar bit of malpractice.
arms_race  artificial_intelligence  China  CFIUS  Donald_Trump  economic_warfare  economic_aggression  FDI  geopolitics  international_trade  investors  investing  intellectual_property  industrial_policies  protectionism  politicians  robotics  One_Belt_One_Road  security_&_intelligence  Silicon_Valley  SOEs  start_ups  theft  U.S.  venture_capital  Washington_D.C. 
july 2018 by jerryking
Ten Lessons from Michael Batnick’s Book ‘Big Mistakes’ – Ivanhoff Capital
The best way for investors to learn from mistakes is to let others make them, then read about it

In his first book, Michael Batnick outlines the big investing and trading mistakes of some of the most successful investors and brightest minds that are known to humankind. Most mistakes revolve around the same themes:
– being overleveraged and building too big positions in assets that were illiquid or suddenly became illiquid;
– venturing outside of expert zone when having to manage a much bigger amount of capital;
– overconfidence and hubris;
– normal mistakes that cannot really be prevented; they are part of the investing process;
– fear of missing out.
lessons_learned  mistakes  investing  investors  overconfidence  books  book_reviews  personal_finance 
june 2018 by jerryking
The trade war has arrived. Three things investors should consider doing right now - The Globe and Mail
JUNE 1, 2018 | THE GLOBE AND MAIL | GORDON PAPE.

As an investor, what should you do? Here are some suggestions.

Reduce exposure to Canada. We will fare far worse than the United States in a trade war, and growing uncertainty about the future will curtail capital investment. Apart from financial companies and the newly revived energy sector, there are few areas of the TSX that inspire confidence. One exception: Companies that do a lot of business in the U.S. and are not hit by the new tariffs.

Increase exposure to the U.S. Mr. Trump has proven he is no friend to Canada (or any other ally, for that matter). However, his policies have revitalized the U.S. economy, particularly with the corporate tax cut and the slashing of crippling regulations. Unemployment in the United States is below 4 per cent, the lowest in almost two decades, and the American stock market continues to hit new highs.

Raise cash. If the worst-case scenario unfolds, the world economy will eventually tank. At that point, you want to be in a position to take advantage of the bargains that will emerge, as they did in 2008.
crossborder  defensive_tactics  investors  personal_finance  trade_wars  worst-case 
june 2018 by jerryking
An unusual family approach to investing
May 30, 2018 | FT | John Gapper.

JAB’s acquisition of Pret A Manger resembles private equity but with a long-term twist.

Warren Buffett’s definition of Berkshire Hathaway’s ideal investment holding period as forever. ....Luxembourg-based JAB, owned by four heirs to a German chemical fortune, takes a family approach to investing. It is unusual in that this holding company seeks to retain its portfolio companies for at least a decade. These include Panera Bread, Krispy Kreme and Keurig Green Mountain coffee, which it merged with Dr Pepper Snapple in an $18.7bn deal in January 2018. This week JAB acquired the UK sandwich chain Pret A Manger for £1.5bn, continuing its buying spree of cafés and coffee, mounting a challenge to public companies such as Nestlé.

**These companies are acquired not to be traded but to be invested in and expanded.**

JAB is an innovative combination of ownership and investment in a world that needs challengers to stock market ownership and private equity. It is family controlled, but run by veteran professional executives. When it invests in companies such as Pret A Manger, it deploys not only the Reimann family’s wealth but that of other entrepreneurs and family investors.......Some of the equity for its recent deals, including Panera and Dr Pepper, came from funds raised by Byron Trott, the former Goldman Sachs investment banker best known for being trusted by the banker-averse Mr Buffett. Mr Trott’s BDT banking boutique specialises in advising founders and heirs to corporate fortunes, including the Waltons of Walmart, and the Mars and Pritzker families.

This is investment, but not as most of us know it. By definition, the world’s companies are mostly controlled by founders and their families — only a minority become big enough to be floated on stock markets and need to disclose much of their workings to outsiders. Family fortunes also tend to remain as private as possible: there is little incentive to advertise how much wealth one has inherited......As [families'] fortunes grow in size and sophistication, more of the cash is invested in other companies rather than in shares and bonds. That is where JAB and Mr Trott come in.

Entrepreneurs and their families tend to be fascinated by their own enterprises and bored by managing their wealth. But they want to preserve it, and they often like the idea of investing it in companies similar to their own — industrial and consumer groups that need more capital to expand. It is not only more interesting but a form of self-affirmation for the successful....Being acquired by JAB is appealing. The group turns up, says it will not take part in an auction but offers a good price (it bought Pret for more than its former owner Bridgepoint could get by floating it). It often keeps the existing executives, telling them they have to plough their own money into the company, and invests in long-term growth provided the business is efficiently run.

This is more congenial than heading a public company and contending with a huge variety of shareholders, including short-term and activist investors. It is also less risky than being bought by 3G Capital, the cost-cutting private equity group with which Mr Buffett teamed up to acquire Kraft Heinz. While 3G is expert at eliminating expenses it is less so at encouraging growth.
coffee  dynasties  high_net_worth  holding_periods  investing  investors  JAB  long-term  Nestlé  Pritzker  private_equity  privately_held_companies  Unilever  unusual  Warren_Buffett  family  cafés  Pret_A_Manger  3G_Capital  discretion  entrepreneur  boring  family_business  heirs 
may 2018 by jerryking
Al Gore: sustainability is history’s biggest investment opportunity
Owen Walker YESTERDAY

Fourteen years ago Mr Gore co-founded a sustainability-focused fund management company with David Blood, former head of Goldman Sachs Asset Management. Rather than the colourful “Blood & Gore Partners”, they named the business Generation Investment Management. The London-based group has since attracted $19bn in assets, managing money for institutional investors and affluent individuals, mainly in North America and Europe....Mr Gore has just given a presentation to UBS wealth advisers at the bank’s annual investment get-together. Unlike most of the PowerPoint-packed presentations, Mr Gore’s delivery is a glitzy affair, with dramatic theme music and video clips of crashing glaciers. His talk receives a standing ovation and he is mobbed for more selfies at the end....Generation lists large public sector investors among its clients, such as Calstrs, the $223bn Californian teachers’ pension plan, the $192bn New York State pension plan and the UK’s Environment Agency retirement fund. It also manages money for wealthy individuals but has stopped short of opening to retail investors. Almost all its assets are run in equity mandates, yet $1bn is invested in private equity
Al_Gore  sustainability  asset_management  institutional_investors  investors  green  climate_change 
april 2018 by jerryking
Investors should bet on smaller nimbler companies and countries
March 25, 2018 | FT | Rana Foroohar.

The assets that seem undervalued and safer are all smaller things. Southeast Asian “countries, as well as Southern Europe and parts of Latin America have lots of slack relative in particular to the US, but also core Europe and even China”, says Jay Pelosky, head of the investment advisory firm Pelosky Global Strategies. “They have more room for growth, profit expansion, investment, and a lot more political breathing space.”....Meanwhile, if the US and China really do end up engaging in a full-blown trade war, it may be the smaller Southeast Asian nations that will benefit, since they will continue to be open for business with both. The Association of South East Asian Nations could become an alternative supply chain and preferred trading partner for either region......It may be that Big Tech companies, like big banks, have simply become too sprawling for their own good. Smaller, more localised players will probably also avoid the worst effects of tariffs......Aside from being a less visible target for protectionism, small firms with lower debt levels are better positioned to cope with rising interest rates. Research group Strategas notes that small-cap stocks are the only asset class that has outperformed inflation in every decade from the 1930s onwards. 
investors  Rana_Foroohar  nimbleness  small_cap  ASEAN  asset_classes  supply_chains  Big_Tech 
march 2018 by jerryking
How One Investor Made a Fortune Picking Over the Retail Apocalypse - WSJ
By Khadeeja Safdar and Miriam Gottfried
March 21, 2018

While private-equity firms and public investors have been shying away from traditional retail, Sycamore has made bigger bets on the sector. It bought Staples Inc. in September for $6.8 billion—the largest U.S. leveraged buyout of 2017.... strong demand from pension funds and other institutions to co-invest to tap Sycamore’s retail wizardry.

With Sycamore’s strategy, it isn’t necessary to spruce up a purchased company. The firm often buys struggling retailers and sells off their most valuable pieces. It cuts costs at whatever remains, sometimes using the savings to extract dividends.

The firm tells investors its returns “need not depend” on successfully identifying growth opportunities for its retail targets, according to documents for its new fund.

Sycamore also extracts returns from clothing chains by acting as a middleman between them and suppliers, using a company it owns to sell inventory to the retailers, sometimes as they struggle to remain solvent, according to industry executives and court filings.....“Sycamore is the best of the bunch in the retail sector,” .....Sycamore’s team doesn’t usually get involved in day-to-day operational decisions such as selecting merchandise and designing store layouts, preferring instead to hire consultants and veteran retail executives, said former executives at some of its portfolio companies.
private_equity  retailers  cost-cutting  investors  bricks-and-mortar  apparel  Staples 
march 2018 by jerryking
BlackRock’s Larry Fink Wants to Become the Next Warren Buffett
Feb. 7, 2018 | WSJ | By Sarah Krouse.

BlackRock’s new vehicle, known within the firm as a “long-term private capital” vehicle, is part of that push to emphasize alternative investments. The firm already manages $145 billion in higher-fee investment strategies that include private equity and hedge funds of funds, real assets and private credit. But it doesn’t have a buyout fund of its own.
BlackRock  Laurence_Fink  asset_management  Warren_Buffett  long-term  investors  investing 
february 2018 by jerryking
Knowing what we don’t know is an important investing skill,
DECEMBER 19, 2017 | The Globe and Mail | Scott Barlow, Globe and Mail market strategist.

"Making short-term predictions about how a price chart reflecting the actions of millions of people will fluctuate is more than just hard. The word Mandelbrot uses is "unpredictable" rather than difficult. Again: not predictable… Mandelbrot is not saying that investors should throw their hands in the air and quit, but rather that they should use the tools of probability in a more refined and nuanced way… Risk comes from now knowing what you are doing and avoiding those areas [that are inherently unpredictable] is a very good thing."

Mr. Mandelbrot's concepts do not make for easy reading and I don't pretend to understand even a majority of their implications. It is important, I think, for investors to have a general understanding of his findings nonetheless.

For one thing, Mr. Mandelbrot's work throws a huge wrench into Modern Portfolio Theory, the highly popular efficient frontier investing strategies that use distribution curves and standard deviation as a measure of risk. As Berkshire Hathaway's Charlie Munger said, "if you think [distribution curves] apply to markets, then you must believe in the tooth fairy. It reminds me of when I asked a doctor at a medical school why he was still teaching an outdated procedure, and he replied, 'It's easier to teach.' "
investing  risks  financial_markets  investors  Charlie_Munger  unpredictability  pretense_of_knowledge  unknowns 
december 2017 by jerryking
As Silicon Valley Gets ‘Crazy,’ Midwest Beckons Tech Investors
NOV. 19, 2017 | The New York Times | By STEVE LOHR.

The rationale for investing in the Midwest combines cost and opportunity. A top-flight software engineer who is paid $100,000 a year in the Midwest might well command $200,000 or more in the Bay Area. The Midwest, the optimists say, also has ample tech talent, with excellent engineers coming out of major state and private universities in the region.

But they also point to technology shifts. As technology transforms nontech industries like health care, agriculture, transportation, finance and manufacturing, the Midwest investors argue that being close to customers will be more important than being close to the wellspring of technology.

“The value will come from marrying industry knowledge with technology,” said Mr. Olsen of Drive Capital. “There’s an arrogance in Silicon Valley that we don’t need industry expertise. That’s going to be less and less true in the future.”.....Referring to the troubles chronicled in his book, Mr. Vance said that “at least a partial solution is to get more investment capital into this part of the country.”....Mr. Case and Mr. Vance talk of the need to create “network density” by bringing together more entrepreneurs, customers, partners and investment capital. The trips can and do yield investment candidates for Revolution, but start-up evangelism is the main theme.
investors  Silicon_Valley  start_ups  Hillbilly_Elegy  venture_capital  vc  Midwest  Steve_Lohr  J.D._Vance  industrial_Midwest  rust_belt  Steve_Case  industry_expertise  network_density 
november 2017 by jerryking
Katzenberg’s Big Ask: $2 Billion for Short-Form Video Project
OCT. 2, 2017 | The New York Times | By ANDREW ROSS SORKIN.

Jeffrey Katzenberg’s idea of fund-raising is on a very different scale.

Mr. Katzenberg....is trying to raise $2 billion for his new television start-up. That is likely to be the largest first round of financing in history for a digital media company that, at least at the moment, is only a concept swirling around in his head......Mr. Katzenberg, 66, is convinced that his new product, called New TV, can upend the format of television for mobile devices. He wants to create the next-generation version of HBO or Netflix, purpose-built for viewing on phones and tablets with short-form content of premium quality — think of “Game of Thrones” as if each episode had a narrative arc of 10 minutes.

He wants to create big, expensive productions at a cost of $100,000 a minute. (For the sake of comparison, a highly produced minute of programming on YouTube might cost $10,000.)......Mr. Katzenberg’s hunch about the way a huge swath of consumers will watch television in the future is, in all likelihood, right. The number of teenagers and young adults who have their nose pressed to their mobile devices watching video content is startling. Globally, 72 % of all video is viewed on a mobile device, according to Ooyala, a video platform provider.

The question is whether his idea is ahead of its time. And whether he can find the right business model to support such expensive programing.

Mr. Katzenberg is a realist. “We need $2 billion. That’s a high bar,” he said. And he acknowledges that the financial details still need to be worked out. It’s daunting. He needs to build an instant library of content — and a big one.....Mr. Katzenberg’s gamble is being taken seriously because of his long history of success and his provocative thesis about the current television model. “The design and the architecture of the storytelling fit the business paradigm, not the other way around,” he explained, suggesting that shows were made in the format of a half-hour or an hour for business reasons and do not make sense in the world of mobile devices and streaming.....Mr. Katzenberg does not merely want to simply create a studio that specializes in short-form storytelling; he wants to create a platform for it. He is hoping that many of the big television networks both invest and produce content for the service.
Quibi  start_ups  funding  investors  Jeffrey_Katzenberg  entertainment_industry  content  digital_media  storytelling  platforms  SaaS  video  Andrew_Sorkin  DreamWorks  short-form  mobile  streaming  bite-sized 
october 2017 by jerryking
Ray Dalio and the Market’s Pulse
Sept. 24, 2017 | WSJ | By Andy Kessler

Has Ray Dalio lost the pulse? The founder of the $160 billion hedge fund Bridgewater Associates is all over the place spouting his management philosophy of radical transparency. .....The investment whiz lives and manages by a set of principles that employees have to memorize. ..... “Most problems are potential improvements screaming at you.” Or this reworked cliché: “While most others seem to believe that pain is bad, I believe that pain is required to become stronger.”.....Bridgewater is losing money this year. Through July its flagship fund is down 3%, while the market is up more than 10%. ......The core of investing is quite simple: Determine what everyone else thinks, and then figure out in which direction they are wrong. That’s it. No one tells you what they think. You’ve got to feel it. .....It’s all about figuring out what is priced into a stock right now. That’s the pulse of the market, the collective mind meld aggregated into stock prices. I know from experience this is the hardest part of running a hedge fund. You can find the greatest story ever, but if everyone already knows it, there’s no money to be made..... the pulse changes with each government statistic, each daily ringing of cash registers and satellite images taken of parking lots. That’s why stocks trade every day. Real-world inputs and the drifting pulse drive the psychotic tick of the stock market tape. ....How do you find that pulse? .....

It’s best to survey your own people......Dalio doesn’t care about employees’ opinions or ideas; he just wants to take their pulse to figure out what the market already knows. Or as he puts it: “The biggest mistake most people make is to not see themselves and others objectively.”....Too much capital is often a burden. There are only so many good investment ideas out there, and it’s late in this cycle.....“Truth—more precisely, an accurate understanding of reality—is the essential foundation for any good outcomes.” Here’s a truth: If Bridgewater has lost its mojo, Mr. Dalio would be smart to manage a much smaller pot of money rather than torture his employees.
Andy_Kessler  Ray_Dalio  Bridgewater  hedge_funds  investors  investing  biases  market_sentiment  pretense_of_knowledge  principled  transparency 
september 2017 by jerryking
Vice tunes into youth audience with frontline coverage in Charlottesville
19 August/20 August 2017 | Financial Times | Matthew Garrahan.

The Charlottesville film took Vice viewers much closer to the demonstrating racists than most rival media reports. While US news channels reacted to the demonstration and its violent aftermath when an anti-fascist protester was murdered by an alleged domestic terrorist, Vice was ahead of the game, Ms Bell said

“The mainstream media’s reaction to the march on the day felt like they were being taken by surprise but Vice was very well prepared,” she said. “They knew who the protagonists were and have been following this issue and thinking about it for a while. They knew about these protests for months and knew it would be a big story.”

Vice said Elle Reeve, its correspondent who reported from Charlottesville, had spent time earning the trust of key figures in the hate groups that participated in the march.

The mainstream media’s reaction to the march on the day felt like they were being taken by surprise but Vice was very well prepared

“It really is a triumph of old fashioned beat reporting,” said Josh Tyrangiel, executive vice-president of news at Vice. “She is able to distinguish between the different groups and the fact that she is capable of understanding them gives them some trust that she takes them seriously.”

Mr Tyrangiel said Vice’s decision to get close to the Charlottesville protesters reflected the interests of its audience. “There is so much going on in the world and successful news organisations know they can’t possibly own every story. We’re going to own the things that are very important to our audience. 

“If you’re CNN or the New York Times, they’ve done very well on their top [story] priorities. For us, because we lean younger, the rise of those groups seem like it’s one we should own.”

Investors in Vice are well aware of the company’s rising profile. The TPG deal was the latest in a string of investments in Vice, which has more than doubled in value since 2014. 

WPP, the world’s largest advertising group, was an early investor, buying an 8 per cent stake that is now worth more than $450m.

Rupert Murdoch’s 21st Century Fox bought 5 per cent in 2013 for $70m — a stake that is now worth close to $300m — while James Murdoch, the company’s chief executive, sits on the Vice board. Walt Disney recently paid $400m to double its stake to about 10 per cent while A&E Networks, a television group it owns with Hearst, invested in and launched Viceland, Vice’s cable channel.
digital_media  Charlottesville  white_supremacy  Vice  investors  Josh_Tyrangiel  TPG  WPP  21st_Century_Fox  anti-Semitism  Walt_Disney  valuations 
august 2017 by jerryking
Latest to Be Blamed for Retailers’ Woes: Private Equity - WSJ
By Lillian Rizzo
Updated July 30, 2017
A wave of retail bankruptcies washing through court has revived an old debate about the role of private-equity firms in accelerating the problems of companies in distress......"During that same time, Payless was also grappling with dwindling mall foot traffic, consumers shifting to spending online, changing trends and many store leases. Since the bankruptcy filing, hundreds of Payless stores have been closed, and employees have been laid off."

Vendors and landlords alleged in court papers that the dividend payouts, along with other payments to the investors, left the retailer particularly vulnerable to collapse just as technology and shifting consumer behavior upended the retail industry.

“The depletion of their coffers put the company on a dangerous path that ultimately led to this instant bankruptcy filing,” a group of Payless’s unsecured creditors said in June court papers.
retailers  bricks-and-mortar  private_equity  investors  bankruptcies  foot_traffic  creditors  store_closings 
july 2017 by jerryking
All the companies in Jeff Bezos’s empire, in one (large) chart
June 30, 2017 |MarketWatch | SALLY FRENCH, SOCIAL MEDIA EDITOR & DRONE REPORTER
charts  Jeff_Bezos  privately_held_companies  investors  angels  Amazon 
july 2017 by jerryking
As an Investor, Do You Suffer from ‘Narrow Framing’? - WSJ
By Shlomo Benartzi
June 11, 2017

Many of the financial mistakes people make are caused by a fundamental shortcoming: They can’t see the big picture.

In behavioral economics circles, this is known as “narrow framing”—a tendency to see investments without considering the context of the overall portfolio. Many people are vulnerable to it.
investors  behavioural_economics  narrow-framing  the_big_picture  portfolio_management 
june 2017 by jerryking
Meet the People’s Quant, an Ex-Marine Who Champions Value Investing - WSJ
By Chris Dieterich
June 2, 2017

Wesley Gray’s value-focused fund of overseas stocks is beating all its rivals over the past year. For him, it’s almost beside the point.

Mr. Gray, chief executive of asset manager Alpha Architect LP outside of Philadelphia, says watching short-term market moves doesn’t pay off. Instead, his firm focuses on the benefits of finding and buying a small number of very cheap stocks, and holding them through thick and thin.

Alpha Architect is an upstart active investment manager that tripled its assets last year, a noteworthy performance at a time when traditional stock pickers are struggling with lackluster performance and investor withdrawals. The firm, with $522 million in assets, is among a growing crop of money managers using academic financial and behavioral research, and algorithms, to identify stock bets likely to beat the market.

So-called quantitative investment strategies pulled from academic research have been around for years, popularized by the likes of Dimensional Fund Advisors and AQR Capital Management. Mr. Gray and Alpha Architect aim to deliver highly potent iterations to smaller investors.

Mr. Gray is a former captain in the U.S. Marine Corps who served a tour in Iraq, and later earned a Ph.D. in finance from the University of Chicago Booth School of Business. He says extreme discipline is a crucial component of his concentrated, algorithmic adaptations of classic value investing, popularized by Benjamin Graham and Warren Buffett.

Last year Mr. Gray put out a report, “Even God Would Get Fired as an Active Investor,” concluding that stock-picking foresight alone wouldn’t equip investors to conquer perhaps their most formidable foe: the fear-driven urge to cut losses.....the market is littered with winning strategies that lose their potency over time, and smart-sounding theories that fail outright when put into practice. Moreover, success in investing often leaves market-beating managers awash in fund inflows that quickly outstrip their capacity to generate ideas.

Mr. Gray responds that the research upon which his strategies are based have proved their resilience for years, and that they can be explained by investor behavior. He admits that he has considered the implications of getting too big, a state that he says isn’t imminent but could force unhappy changes on his firm.
alpha  investors  quants  USMC  PhDs  value_investing/investors  asset_management  algorithms  behavioural_economics  quantitative  idea_generation  finance  active_investing  stock_picking  investment_strategies  beat_the_market 
june 2017 by jerryking
Naive entrepreneurs at risk of losing out to venture capitalists
Jan. 20, 2016 | The Financial Times News: p6. | Murad Ahmed

Tech start-up financing is often structured to protect venture capitalists, not founders, says Murad Ahmed

Nicolas Brusson and Philip...
entrepreneur  founders  vc  venture_capital  France  BlaBlaCar  trustworthiness  relationships  funding  asymmetrical  investors  naivete  connected_cars  from notes
april 2017 by jerryking
With 125 Ph.D.s in 15 Countries, a Quant ‘Alpha Factory’ Hunts for Investing Edge - WSJ
By BRADLEY HOPE
Updated April 6, 2017

The firm is part of the forefront of a new quantitative renaissance in investing, where the ability to make sense of billions of bits of data in real time is more sought after than old-school financial analysis.

“Brilliance is very equally distributed across the world, but opportunity is not,” said Mr. Tulchinsky, a 50-year-old Belarusian. “We provide the opportunity.”

To do this, WorldQuant developed a model where it employs hundreds of scientists, including 125 Ph.D.s, around the world and hundreds more part-time workers to scour the noise of the economy and markets for hidden patterns. This is the heart of the firm. Mr. Tulchinsky calls it the “Alpha Factory.”....Quantitative hedge funds have been around for decades but they are becoming dominant players in the markets for their ability to parse massive data sets and trade rapidly. Amid huge outflows, traditional hedge funds are bringing aboard chief data scientists and trying to mimic quant techniques to keep up, fund executives say.

Some critics of quants believe their strategies are overhyped and are highly susceptible to finding false patterns in the noise of data. David Leinweber, a data scientist, famously found that the data set with the highest correlation with the S&P 500 over a 10-year period in the 1990s was butter production in Bangladesh.
quantitative  Wall_Street  PhDs  alpha  investors  slight_edge  massive_data_sets  signals  noise  data_scientists  real-time  algorithms  patterns  sense-making  quants  unevenly_distributed  WorldQuant 
april 2017 by jerryking
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