Our Investment Approach

We focus on what we know and what’s worked for us – well-managed companies with growing businesses and predictable cash flows. We limit commodity exposure because commodities are inherently unpredictable. We avoid speculative startup companies that are not yet profitable. We value predictability; an unappreciated part of building wealth is avoiding speculation and significant losses.

Our philosophy can be summed up in a single question: what makes a good business? We meet with hundreds of companies a year. From a wide funnel of opportunities, we choose a few. Unlike a typical fund which can hold 100+ positions, we carefully select 20 to 30. Combining a bottom-up research approach with insights gained from our network of private contacts, we narrow our focus to a select list of investment opportunities.

We don’t just select companies, we invest in the people who run them. We identify companies with strong competitive advantages and sustainable growth runways that are managed by people we trust. While all companies go through challenges and volatility, with a long time frame, a well-run business will continue to compound growth and value over time. If we focus on getting the company right and pay a reasonable price, the rest will take care of itself.

When we buy a company, we hope to hold it forever and benefit from long-term earnings growth and capital appreciation. We don’t try to time the market, and are generally fully invested. As a result, we tend to have low turnover, which minimizes unnecessary frictional costs and capital gains.