Dan Sundheim - The Art of Public and Private Market Investing - [Invest Like the Best, EP.460]

Ramp does the exact opposite. Ramp understands that no one wants to spend hours chasing receipts, reviewing expense reports, and checking for policy violations. So they built their tools to give that time back, using AI to automate 85% of expense reviews with 99% accuracy.

And since Ramp saves companies 5%, it's no wonder that Shopify runs on ramp, Stripe runs on ramp, and my business does too. To see what happens when you eliminate the busy work, check out ramp.com/invest. Every investor should know about Rogo, because Rogo AI's platform is not just another generic chatbot. Instead, it was designed to support how Wall Street bankers and investors actually work

from sourcing diligence and modeling to turning analysis into deliverables. For me, three key things differentiate Rogo. First, it connects directly to your system so it can work with your actual data. Second, it understands your workflows how work really happens across a deal or an investment. And third, it runs end-to-end and produces real outputs the way the best people do.

Auditable spreadsheets, investment memos, diligent materials, and slide decks that match your standards. This all comes from the fact that Rogo is built by finance professionals for finance professionals. And it's already being adopted by some of the most demanding institutions in the world. To learn more, visit rogo.au/invest. Opening eye, cursor, andthropic, perplexity, and versel all have something in common.

They all use work OS. And here's why. To achieve enterprise adoption at scale,

“you have to deliver on core capabilities like SSO, skim, RBAC, and audit logs.”

That's where work OS comes in. Instead of spending months building these mission critical capabilities

yourself, you can just use work OS APIs to gain all of them on day zero. That's why so many of the top AI teams you hear about already run on work OS. Work OS is the fastest way to become enterprise ready and stay focused on what matters most, your product. Visit workos.com to get started. Hello and welcome everyone. I'm Patrick O'Shanacy and this is Invest like the best.

This show is an open-ended exploration of markets, ideas, stories, and strategies that will help you better invest both your time and your money. If you enjoy these conversations and want to go deeper, check out Colossus, our quarterly publication with in-depth profiles of the people shaping business and investing. You can find Colossus along with all of our podcasts at Colossus.com. Patrick O'Shanacy is the CEO of Pasta of some. All opinions expressed by Patrick and podcast

guests are solely their own opinions and do not reflect the opinion of positive sum. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of positive sum may maintain positions in the securities discussed in this podcast. To learn more, visit psum.vc. My guest today is Dan Sunshine. Dan is the founder and CEO of D1 Capital Partners. I wanted to do

this conversation for a long time. Dan is one of those investors who thinks about markets and business constantly and has built a career entirely around that obsession. What makes him unique is that he operates at full intensity across both public and private markets simultaneously. With major

“stakes in some of the most important private companies in the world like SpaceX, open AI, and then”

thropic, will running a global public equity portfolio that spans nearly every industry and doesn't concentrate in the consensus names. We start at the beginning of his career. With the story I've

never heard him talk about publicly before, how it shortcase he wrote on orthodonic centers of

America and posted on value investors club crashed the stock and helped him land his first job. He shares why he backed anthropic at a moment when many people told him it was the lift to open AI's Uber. What reading Dario Amadez as he's reminded him of Bezos's letters to shareholders and how he thinks about LL and business models through the lens of Netflix and Spotify. We spend time on the extraordinarily stressful moment in early 2021 when GameStop hit the firm

and what Dan believes is the single biggest tail risk facing the global economy right now. It's hard to spend time with Dan and not come away, struck by how much he genuinely loves his work. I hope you enjoy this great conversation with Dan sometime. I want to spend a bunch of time talking about public versus private. If you do both, you started investing in private more than 10 years ago. You were kind of one of the pioneers of this.

You've got some amazing huge private positions. Draw the contrast today in

2026 of the difference in how the two markets feel. Here's a lot of things here.

“Like, I think about valuation differences. What one tells you about the other,”

you know, the business of private versus a public equity hedge fund. I want to go into kind of all of it. At a high level, what is your feeling on the difference between the two markets? It changes over time. It depends on where you are in a cycle. It's a right now. I think that there's a lot of interesting opportunities in the late stage privates. Some of the largest communities in the world by market cap are private right now.

And not only are they large and private. They are innovating in a way that's going to change the world. This moment is particularly interesting. I think that in general, private markets are less competitive. Obviously, the core skill set of analyzing businesses is the majority of what create value. But there's other aspects of it, too. Oftentimes, there's no disagreement

be an investor in the company. So it's competitive from the standpoint of like being able to

“create a situation where you can invest in the best companies. But in terms of like how difficult”

is it to generate, returned by assessing companies? I'd say the public markets are the most competitive in the world, even though they are less efficient than they were before. It's still you have more people and more places looking at information companies, or the private side, just by definition, you fewer people looking at every situation and less capital. I would say that one difference that equalizes a bit is that you don't have this dynamic on the

private side of people doing things that are economically irrational because they're focused in the short-term or they're just their business model is not consistent with investing based on long-term insurance like a value. Where you happen to public markets. In the private market, every time we're looking at a business, everybody's doing same thing. We could talk to other firms that aren't investing in the same company. Their research may be different than ours, but it is all trying to get

at same answer. That's very different in the public markets. So there's fewer people competing, but they're all doing the same thing. Where's the public market? There's tons of people competing, but they're all playing a different sport. If you think about the key companies in your private portfolio today and drop it, open AI companies like SpaceX, ramp, etc. What does that group teach you? What do you think you see coming that maybe the public markets don't fully appreciate yet

that don't have that same exposure to those great private businesses? As long as I've been doing private and public investing, at some points in time, there's synergy. But I'd say, if you go back to when we found out the firm 25% of the time we looked at a private company, there was some synergy with what we were doing in the public side. Now, because of AI and because of there's so much innovation happening in the private markets, the synergies are just greater than I've ever seen before.

In that I think if you're going to take a view on public companies that are deeply impacted by AI,

“which eventually will be almost ever public company, you should have an opinion on where's the”

technology now, or is the technology going, where the implications of it, and investing in those

companies gives you that perspective in a way that I've never seen greater synergy. When you first

were considering your initial investments in Open AI and Anthropic, did you pattern match their businesses or their business models on anything that you would see historically that they remind you of anything? They were very different. When we first invested in Open AI, I wouldn't say it was contrary to it all. To some extent, we invested over just 825 billion dollars around. So I don't think people were entirely sold on LLMs as a business model, but if you wanted investment LLMs as a business

model, Open AI was the one. Whether you invest in LLMs or didn't invest in LLMs was the baited quite a bit. I mean, I think there was a lot of uncertainty about the ultimate business policy companies. That was what we had to figure out. Anthropic was a different situation in that

we first invested in Anthropic, a number of people that spoke to who I think are very smart,

drew the analogy of Uber versus Lyft, or why are you investing in the second player in most industries investing in the second player is not the path to glory. But the way I viewed it was it was incredibly difficult at that stage to say who is going to be first and who is going to be second. The pattern recognition to answer your question for me, Anthropic was just reading Dario's essays and listening to him on podcast. When I look back in my career and look back

“in the companies we missed, Amazon in the early days, and I think what could I have seen?”

If you look at their income statement, you would just see a sea of red. The only telltale sign was reading Jeff Bezos is 1997 and he had a seven shareholder letter, which was like the clarity of thought, his understanding of what he wanted to achieve and how to create value for shareholders was greater than almost any public CEO I dealt with. If I had read that and almost ignored everything else, it would have been a really important sign and very profitable. Dario struck me

like that. It wasn't that the models at that point were so differentiated. I think they were

considered to be one of probably maybe at that point five, six, seven players that could ultimately

be important. There's still a lot of the beta on LMS as a business model, but I felt like he was incredibly skilled and extremely focused and I placed a lot of weight where they were only on clarity of thought and the ability to communicate as a CEO like what you want to achieve and higher energy that especially in written form because taking this time to rights up and down,

makes sense to everybody else. And Dario just did that better than almost any CL I've seen since Bezos, how would you frame the debate today about LMS as a business model? How do we know a bit more? Back then it was like are these businesses going to ever generate an economic return? I think one analogy was AI will be huge so was air travel. Airlines were like a business. There's nothing differentiating about one air life together and so therefore the returns go down to the

cost of capital. Obviously we took a different view but that was like a 65 35 70 30 degree confidence in that at that point it was more about the skew. If things played out like we thought and the business models were actually loaded would be huge. I think at this point we're in a different place

“in terms of the debate that's important. The debate that's important now if you want to look”

through a positive lens which we do you'd say that the businesses have taken slightly different lanes and have excelled at different things within the AI. So OBI has been a great consumer and has had good traction enterprise. Anthropic has been incredibly successful at coding. There was a

thesis we first invested that APIs or the business of having other software companies plug into

your other developers plug into your model would be commoditized or just be afraid to the bottom. I think that debate is more or less irrelevant because you've just seen with cloud code and even open eyes API business. These are durable businesses and yes can you switch? You can the same way you could switch AWS or Azure but it's not worth it for live businesses to do it and there's sufficient differentiation among the models. If you look at the underlying

margins of these companies they are not the margins that you see in a commoditized industry.

“The gross margins are quite high. The competitive landscape I think is not heavily debated.”

At this point you probably have four or five LMS that will be relevant along term. I don't see that changing. Not that there's not sufficient talent out there it's just that the capital required to get into this business is too great in these companies are too big at this point and then you kind of get the snowball of more capital you have the more compute you get better researchers adding to be very difficult. So the competitive landscape is not really in question.

I don't think anyone would say that these business models are commoditized. I think the real debate is these are extremely capital into businesses. Capital intensive to a degree that we've

never seen before in the history business. And the question is you're spending a ton of capital

and the ultimate return of the capital is unknown. So it's not like a normal business that builds a factory and knows what they're going to sell. You are spending tons of capital to training model and the question is do the scaling laws work such that there are turns on that capital continue to be attractive which means that you will be able to attract more capital and build better models or are you going to get to a point where everyone looks back and

says we raised too much money. We spent too much training models. We didn't get the economic return

“or I think equally likely not more likely people would say ultimately you will get the”

economic return but it just happened slower than you would have thought. Enterprise adoption just

didn't take off as quickly as you thought and therefore the problem is when you are this capital

intensive as a business it introduces financial leverage and operating leverage to degree you don't see in oral businesses. So you don't have the luxury of two or three years of things going slower than you otherwise would expect. I think the scaling laws there are turns on capital and the speed at which these tools and AI as adopted throughout the economy are the questions. Is there anything that like Netflix or something like that could teach us that's another

business that comes to mind where there's crazy amount of capital that was spent to build the asset and then it gets advertised over a bigger and bigger user base and that's turned out to be a great stock and one that I know you've owned a lot. Is there any analogy between those two that's interesting to you? Well I was speaking to the executives at the LLMs. The way I framed this I said look I think your business is some kind of combination between Netflix and Spotify. Netflix in that unlike other

tech companies you are spending a ton of money upfront to train these models. Once these models are trained, you go sell them at extremely high incremental margins. You don't know what the revenues are going to be from that fixed asset that you've built but to the extent that you've built that asset you want to sell as much as possible so that you can get the cash laws to build the next model and so on and so forth. That's very similar Netflix in that they invest in content and when you're

invest heavily. You get the revenues. You spread it out over an increasing number of people. You invest more in that fixed asset and that just kind of has a flywheel effect of generating more revenue, more content, more revenue, more content and eventually you get to the point where

it's almost impossible to compete because it's just a first mover advantage is too great. Yeah,

the difference if you were to say like what is an important difference of Netflix versus these models is that Flix's content was differentiated. The models are more similar than they are different. I didn't give in time. Open AI may have a better model in traffic, they have a better model. But a lot of the expertise and innovation gets disseminated pretty quickly so these models

“are not terribly different and that's where the Spotify analogy comes in in that I think if you're”

Google or you are open AI the differentiating factor will not necessarily be that Google gives you a better answer. Like if we were just like to query Gemini or chatGBT and something I don't think it's the case that we would say definitively one will give you better answer over time. However,

the personalization matters and the first mover advantage is like the more that these models

know about you, how you live your life, your health, all the things are important to you. You build up this data history and it becomes very sticky. The music on Spotify is no different than Apple music or Amazon music. Theoretically it's a pure commodity. What makes Spotify have pricing power or what makes it differentiated? Why would people be incredibly upset if you said like you had to not use Spotify anymore? It's because it's personalized because they've

“tailored the service to take a product which is a commodity and personalize it to the point where”

you really pay a premium for that commodity. If you were giving advice to the executives at these

companies and telling them what to lean into and what to look out for over the next five years,

I'm curious what you would say because the scaling laws are so interesting in the sense that like the models keep getting unbelievably better and that probably means the revenue available is like who knows how big it could be to be the whole world. But the cost keeps going up by like orders of magnitude, the cost is two data centers. This unfathomably big thing. It's a two gigawatts of power. It's crazy. What advice would you give them based on everything you've learned about these big

massive businesses? The really interesting thing and challenging aspect of these businesses, the LLMs is that the models they are building now and especially in the future can be applied to almost any aspect of the economy. You can take these models and you can make consumers lives more efficient by having them be personal assistants. You could solve physics problems. You could help the drug discovery. You could make enterprises more efficient. Detailment certainly not the problem.

Focus is going to be a question mark. On the one hand, the more and market you go after with the fix asset, the better. You're spraying that cost over more and markets and having more revenue,

“which then can be reinvested. I think the flip side of that is that I rarely have seen any company”

succeed trying to do go after multiple and markets at the same time. Usually you have an 18, an 18 is focused on one thing. Your culture as a company is oriented towards either consumer enterprise, even Amazon, which you'd say is like the example of a consumer company that got into enterprise, they're going into it like seven years later after even if they win public. So trying to do everything at once is tempting because if you're successful, you're effectively just

advertising that fix asset over more revenue streams. At the same time, you risk not being the best at any one thing. That is the trade-off and I think that I'm not sure we have the final answer right now. The market has gone through periods where they thought anthropic was lift and open hours over and up until recently the Center for Open AI was more negative. I think open AI is taking the strategy of let's do everything. We're going to go after Apple hardware, we're going

to go after robotics, we're going after enterprise, consumer science. They've been very successful in a lot of ways, but that's hard. I'm sure there are companies I'm not thinking of, but I can't think of many examples where that's been successful. I understand the temptation to do it, and obviously the difference versus history is that the smartest people in the world are all going to work at these companies. So if anyone's going to pull it off, they will. Andthropy took a different

approach and just said, we are going to focus on enterprise. They tried consumer early on, but it came clear. They didn't abstractions. Then they just went all in the enterprise. They had a lot of

sentiment is that anthropic is winning and they are like now the Uber, if you want to use other knowledge. I think this is going to go back and forth over time, and people probably are carried away in both directions, but I think those are the biggest differences. I would probably err in the side of focus, but I do understand the economic rationale for trying to do as many things

“as once. The only thing I early on we invested in opening eye, this is probably year and a half”

ago, I said that you have to do ads. I understand, I've seen it so many times. People in southern Valley, the idea of ads is like, you know, there were some things. Because it's like, I have this amazing pure technology product that you want me to like take it. Take it with ads and like, you see anthropics, superwalk virtual. That being said, even the companies that were the most adamant about networking ads, like Netflix, if you go back and just listen to what Netflix was

saying even 15 years ago, it was like getting it to ads even read would have been like,

you are at your mind. We would never do that. Ultimately, they did it. And to me, it's like,

if you're going to do it ultimately, one, you can't really compete against companies that are using ads if you're not very hard. If you're ultimately going to do it, you might as well start earlier because you'll be able to culture around just takes time. I don't think it's a big deal that open and I waited, but I was probably, rightly or wrongly, I was pushing for ads sooner than they've

“just going to do it. I think now they're probably going to get it right. As your business”

scales up, everything gets more complex, especially your compliance and security needs. With so many tools offering band aids and patches, it's unfortunately far too easy for something to slip through the cracks. Fortunately, Vanta is a powerful tool designed to simplify and automate your security work and deliver a single source of truth for compliance and risk. There's a reason that ramp,

cursor and snowflake all use Vanta. It frees them to focus on building amazing,

differentiated products, knowing the compliance and security are under control. Learn more at vanta.com/invest. I know firsthand how complex the tech stack is for asset managers, and seemingly every new tool and data source makes the problem even worse, adding more complexity, more head count and more risk. Ridgeline offers a better way forward, one unified platform that automates away all that complexity across portfolio, counting, reconciliation, reporting,

trading, compliance, and more. All at scale. Ridgeline is revolutionizing investment management, helping ambitious firms scale faster, operate smarter, and stay ahead of the curve. See what Ridgeline can unlock for your firm. Schedule a demo at RidgelineApps.com. I'm so curious what you think is going to happen to the hyperscaler now. I saw this news report the other day that Anthropics considering securing 10 gigawatts now of their own power,

which just makes me think we're going to have the power. The scale is going to be so big, one of them just create their own clouds effectively. The harbor might be different,

“more focused on inference, et cetera. Does that jeopardize what these business models would?”

I think people have thought of it's pretty damn good at the hyperscalers. Do you think the future is different as a result of AI? I do. I've kind of thought this for probably about a year now. I am more confident in the thesis that the hyperscalers are a worse business platform going forward. Now, it's interesting because usually when you say something is a worse business model, you're implying that growth is going to slow, margins are going to contract. I actually think

you're going to see the opposite. I think that AWS, as you're maybe Azure doesn't accelerate, certainly GCP. I think these businesses are going to accelerate for a while. Just because they are their customer bases in Thropic, opening high are growing at enormous pace. And as they get to be a

bigger part of the business, the growth is so sorry. The problem is is that you went from a dynamic

where AWS, Azure, some extent GCP, they're customer bases like every corporation in the world. And therefore, they had fragmentation and they had the benefits, massive economies of scale, that no single company could get, and it was a good, very good business. The problem going forward is that I think that economically, it's highly unlikely that LMS are not very concentrated in the hands of four or five companies. Those companies right now, they are obviously, as we discussed,

they're investing a ton and they are cash flow negative. And therefore, they're looking for compute anywhere they can get it. But if we're correct, and if anyone who owns these companies is correct, at some point in the next five to 10 years, they'll be generating enormous amounts of free cash flow. When that happens, I think that they are likely to enforce the compute. And every year AI is going to be a bigger percentage of the workloads at any hyperscaler. And so if you roll out 10 years from now,

I think that the majority of the workloads will probably be AI, the LMS will probably be providing a lot of those workloads. And I think that it will make economic sense to take it in house. Right now, I think that they look at the hyperscalers as more of a financing mechanism. These are well-capitalized companies with big balance sheets. But I don't think these companies

GPU clusters. Running inference on GPUs is very different than workloads on CPUs. And I think these DL LMS are actually better at inference than the hyperscalers. And then you had this whole

“dynamic of Neo Clouds. Now, I think that the initial view from most public investors was that”

this was like pure overflow capacity. There were not GPUs and these things would be dead. As soon as Microsoft got their call-down views. Yeah. Absolutely would not make the case that they are fantastic businesses. But I don't think they're going away like people thought. So I think they're better at running GPU clusters than the traditional hyperscalers are. And I think there's a lot of interest from Nvidia and other chip companies to make sure that their customer base is diversified.

Nvidia is a very big balance sheet and they want to keep these players in business. So over the next 10 years, I think these hyperscalers AWS Azure will grow fast. I think the margins, I guess, will be challenged both because the businesses are getting a lot more capital intensive because AI is capital intensive, more capital intensive than traditional workloads. And also the customer base is getting more concentrated. Meta is not a hyperscaler, but they insourced all their

compute. Why would they pay with just too big to use somebody on the outside? If you think about

“the last couple of years, probably the best thing you could have done is just be long the AI”

built out in all its various forms. And maybe that will remain true going forward. But it seems like the market a little bit is starting to think now ahead to the other implications of AI software we're talking about like the week after software got absolutely decimated in the market

and everyone thinks because of cloud code and the amazing experiences that they're having with

cloud code like software businesses are just screwed. I'm curious how you're starting to think now beyond just the AI built. Okay, it seems like there's a thing like it's going to be here. Now the rest of the world has to start to absorb this technology. How are you thinking through that? Maybe I'm super curious what you think about the software so off. But even more broadly, the real economy now starts to start to swallow this new technology. I'm so curious how you think

that's going to happen. It is incredibly difficult to know. And I don't think that's because

“I don't have perfect information. I think it's just these models are improving at a rate”

which is exponential and understanding how that makes its way into the real economy and the implications is difficult. I think that you probably want to use a few frameworks. It really comes down to like which companies do you think will have a most circumstances. It's fairly straightforward to identify modes that are protected from digital LLMs, like just the proliferation of digital intelligence. Once you get into robotics and other areas, you start to have to question

the modes around some other traditional industrial companies and globally how do countries that were arbitration labor due relative to developing economy. So there's going to be phases of this

where the first phase is software. And that's really because like clock code and their design

guidance. It's like all of a sudden people have seen clock codes and all of a sudden they just see on Twitter that people are saying like, "Oh, I created a CRM system in like a day." And I was like, "Oh my gosh, this isn't good." That's kind of where people are now. We wrote in our letter in a year. I said, "Look, the buildout is still going to be a thing in terms of like places to invest in the public markets." But it's increasingly become which companies are affected. And it's

going to become there haven't been any shorts in AI. There was like basically no shorts prior to 2026, really. Like if you wanted to just say like, "I don't know if shorts have been because of AI, you didn't make a lot of money." In our letter I said, "They're going to be a lot of shorts some longs because of AI." Software is the first one. I think the market tends to swing to extremes. My guess is that software will have to evolve. We'll probably be a worse business model going

forward. But I think the same way that Walmart evolved with Ecommerce. And yes, would they have

all its equal preferred that Ecommerce never happened? Probably, at least at the beginning,

required enormous amount of investment. Their margins took a hit. They had new competitors. I think that'll be the case with software too, where companies have really great distribution and great business models and their systems are referred for companies. One of the things that is like I asked the LLM, I said, "Are you designing your own ERP system?" They said, "No, we're buying a new ERP system from this company." Quite telly. At least you're protected at least for a few years.

I think they're not doing it yet. I think that the systems of record are going to be difficult to displace. I think companies, while it's neat to create software for small productivity

system or a pair of systems, I think it's quite a while before people are just going to be

vibrating an ERP system. But I don't think that you can just sit back as a software company and say worse, the smerechard will be fine. You're going to have to integrate AI and find ways the same way Walmart integrated e-commerce into their business model and it's painful for a long time and probably in the other side of it. But this is like I'd say fairly low conviction because everything about AI's impact on the economy is inherently low conviction because I think everyone

is likely underestimating how much these models are going to improve and to really think about what's going to happen. You have to almost not think like an investor. You have to think like somebody who's into science fiction. Can you imagine a version of the story where this is all just overblown? Is there any coherent potential future where five years from now we're just like actually these things weren't that big of a deal and were there much less of a big deal than

“we thought they were going to be sitting here today? I think the only way that would be the case”

is even this I think that argument would hold would be a scaling laws just totally stopped. But even if scaling laws stopped, even if these models got no better, I think you probably have three years of people learning how to incorporate AI into their daily life or their companies. Certainly there wouldn't be good for the businesses of scaling laws stopped. But I still think you'd have pretty profound changes within the economy and betting that scaling laws are going

to stop is a really low probability assumption. I mean there's just nothing to suggest that's the case and so in fact everything suggests the opposite. I think it's difficult to really get your arms around with that means because we went from like this is like an interesting like chatbot that's like Google to like oh my god these are going to be solving problems that humans can't do. We're already almost there. I have a 12 year old son who's interested in investing I think your son's

“interested in investing we talked about before as well. What do you tell him about the future of”

this profession given these tools? Surely it applies to us too and we may be smart now Elon Musk says I think a line he's used is it's better to go through life being optimist and be prolonging the pessimist and be for a right to be young and to be interested in something and be disappointed because you're just absolutely new. And that's going to be better than you. I think it's like a very self defeating mindset. So do I think that it is likely that at some point in the future

everything that we do is arbitrage the way by AI for sure. I mean I think that that would be naive of me to say no. Do I think that's happening anytime the next couple of years? I don't. But

it's almost like what do you tell someone to focus on? Like first of all, unless someone is really

interested in something, they're not going to be good at it. So it might be the case being a plumber or being an electrician is the most motivated job in the world but if you don't want to be hungry, you're interested in it doesn't help very much. So it's hard to tell your kids don't do this

“or don't do that because it's going to be irrelevant. That's how a podcast recently with the Google”

researcher who laughed and he said like oh I don't even tell my daughter's study. It's just like go out and have a good time. I think that's like a very destructive way of going through life. You should go through life thinking that you want to achieve things and that you're interested in things near curious and the same way as if this doesn't exist. And if it turns out that whatever job you envision having no longer exists, then you'll have to adjust.

You've talked with John and Danielle about the GameStop story. We can touch on it here too. I'm curious though what you most learned about yourself during that period of time when Laura has it that February of 2021's January was GameStop that you went to your team and basically said look the way we're going to calculate your compass. You're not going to include January. Like that was just a completely insane period of time. And so you took certain steps to like

create stability in the business or whatever. But in such a stressful period of returns, I'm just curious what you learned about yourself or what it was like emotionally to go through that time.

It's incredibly difficult. I never want to come across. It's like too exaggerated about

my experience because there's people who go through a lot worse things in life. But as an investor, I'd say that was about as bad as it gets. We went from being top of the world. Everyone thinks you walk on water to being like everyone thinks we're in a business. I don't think I have an enormous ego. But I have a lot of pride in what I do and I don't need to be celebrated. But I also really did not like having our firm and our performance tracks for the mud.

Granted, it deserved to be treated that way. Because the performance was very bad. It also is a bit lonely and that like, you know, they're during GameStop. There's probably a couple people that are going through the same thing you had. I found it helpful to go back and like

But it's lonely. It's a matter of testing your resilience. First of all, we'd never

came close to going into business. That was just nonsense. But I'd never was going to quit. Even though we had made some mistakes, I deeply believe that we were still good at what we do. And that we had something to offer the world and we could be excellent again. I was confident in that, but you know, GameStop, who's the beginning of a change in the market structure on the retail side. So I knew we had to adapt to that. I didn't know exactly how that

would play out by that point by 2021, 2022. I've been doing a job for 20 years. I'd never really had severe adversity. Probably because at some point, like Andreas would just like he was just a very quick service manager. But I never really had that. And so like I thought of myself like,

“am I really going to be like guy who quits the first time? I think the analogies that people”

who gave was like one day at a time. I was like bill acting. It's like, look, every day try to do something

it makes things a little bit better. Because it's not like something that when you have that kind of a drawdown, if I hit the ball out of the park for like three months, like investors be like he's just volatile and crazy. And if I slowly methodically did it, some people would just give up because they'd say this was just too crazy. We don't believe in him. So it's impossible to disprove the negative narrative in the short term, take a lot of time years. And so acknowledging

that this was not going to be something that you changed overnight, people's perception of you as investor, people's perception of D1 as an attractive place to an escapital. That was not going to change overnight, no matter what I did. It was looking inwardly at the team making sure that we were all on the same page. What we were trying to achieve and that no matter how many people outside my doubt us, we were going to do it. At least we're going to try very, very hard.

Was there one moment in the whole experience that most stands out in your memory as particularly salient, whether it was on the difficult side, like emotionally difficult or on the resilient side,

“like a decision that you were going to forge ahead? Does anyone moment stand out?”

There are different moments that like emotionally just hit you in different ways, like new articles and friends calling you, saying, are you going to business or a lot of that? And obviously

those things are painful and something I'd never had to deal with before. I'd never tried to be a

public figure and all of a sudden it became very public. The most important moment was we do semi-annual investor dinners with our LPs. That's our primary for communication. We write letters periodically, but we do these semi-annual dinners, where over a period of four nights we meet with all of our LPs. It was June of 22, beginning of June 22. Troph of our drawdown was at the end of May of 22. And these dinners were schedules for June 3. Jeremy, to present our firm, he said to me,

he said, "We can't do these dinners." This is going to be a bloodbath. To me, it was really clear. I said, "No, we have to do these dinners." And this is the most important time to go out there and speak to our investors. I had a message I wanted to convey. Message was that we were going to do things differently. The stock selection, all of that, was going to be the same, but the portfolio construction was going to be done in a way that was much less risk-prone. The analogy I gave

was we're going to hit singles and doubles. It might take us longer to get back to the high watermark because singles and doubles are not fireworks, but we feel like what we've gone through in 21, 22 was tough enough that even if the right positive and PV thing would be to just keep taking a ton of risk. And obviously, usually the best time to take a ton of risk, because when you've lost all the money, emotionally, I would not be able to go through this. Again, so we just said,

look, we're going to run the business differently. We very much understand if this is not what you

“signed up for here. I think at that point, people were not signed up for like, then to take”

on more risks. I think most of them were like happy to hear it, even if they didn't believe in it. We really went about managing the firm differently. And so that was a pretty pivotal moment, just looking at the eyes of all the investors, feeling pretty horrible in every way. There is something invigorating about turnaround. When you're going through something like, this is the world's collapsing and there's nothing you can do. It's like, that's a very uncomfortable position.

Even if things are really bad, when you have a plan and you believe in that plan, it changes the perspective entirely. And I really did believe in the plan and I believe in the team. And so all of a sudden, I felt like, okay, everybody else made out of us, but I believe it. And we are now the start of the mission to dramatically improve our returns and improve our firm and earn back our reputation as being great investors. Assuming some did, what do you think of the people that

redeemed from DeWonder in that time? I don't harbor any ill will. I mean, looking at the active

people stayed. I always start out these dinners, even though it was the worst time. I say, like,

ask me anything, criticize me. It is my job to deliver for you. If I don't do it, it's on me. I ultimately think that when you screw up in business, capital follows returns. And when you deliver poor returns, capital will leave, we had a lot of great investors that stuck through it. And I deeply appreciate that more than I resent people redeeming. It's pretty asymmetric. What's interesting about the story is, when you ask around, most people would say that you have

an incredibly calm, like your resting heart rate is very low. Like you're always between a four and a six. Like you're never overly excited when things are going well or overly despondent when things are going poorly. And I'm curious how much do you think that disposition matters for great investing? Can you do great investing in your experience, meaning others, without having like a pretty

narrow band of excitability versus despondency? For better words, I've always from the first day

I got the job. I had a lot of confidence when I was doing. I never, like, stepped in and said, like, I'm just better than everyone else. That was never it. But when it came down to looking at a company and making a decision, I felt confident in it. And when I felt confident in the analysis, I generally am pretty balanced. Is it possible for somebody to have a very volatile personality, but train themselves to deal with the ups and downs of markets? I think the answer is yes,

I think there are some hedge managers that have been like truly, generationally great. And here the stories are early on, they were just like throwing things at people on the trading floor and yelling

“and like, ultimately they ended up being great. But you have to be able to not let that emotion”

influence your trading. If you think about the future of the world, given the crazy changes in technology, we haven't talked about SpaceX yet. That's a whole different dimension of like an incredible technology curve that's going on. You mentioned earlier the importance of being optimistic. Where are you the most optimistic? And what parts of the world then its progression gives you the most pause or do things of your eye on to be, if not worried about, you know, keep your eye on.

A most optimistic and economic growth. And I think it has to be the case that if you believe in scaling laws and you believe in a eye that economic growth will be very powerful. And this is the ultimate productivity tool. And what productivity does is it allows you to grow while having disinflation, which is like Nirvana for markets. So I'm very bullish on that. And then there's implications that flow from that, which are more macro, which is something we don't do. But like

that can your deficits do a lot of great things. Like economic growth does a lot of great things for everybody from hedge fund managers and CEOs to people in lower-level jobs. If a country is not growing, it's hard to have a better standard living. That's my more optimistic take. The part of

“me is more uncertain is that I think that we as humanity, we've never encountered something like”

we're about to encounter. So with that kind of profound change, like we're going from the smartest

animals in the planet. We were never the fastest or the strongest, just for smarter than other animals.

We were no longer going to be the most intelligent beings on the planet. And so what are the implications of that? I'm not really sure. I think that there's a lot of negative externalities in it. Like I don't think humans as much as people like Dario who I respect a lot might say like well we're just going to give everybody a check and like everybody just kind of live off universal basic income. I just don't think humans are wired to just collect the check and go around and like play sports all

day. Humans are wired to great relationships to create value, to work, to coordinate with other humans and achieving things. And I just, I don't think you're going to make great society if it's just a bunch of people living off of checks that come from the government as a result of this massive economic boom. One of the most interesting stories you've told me before was this time when you

“made, I think similarly sized investments in Rivian and SpaceX at the same time. Can you tell”

that story? Both big, big bets. Obviously SpaceX, you've got this huge position now. But I loved that story of like this style of big bet private market investing and exciting technologies. And then the way things can go. And if you can bring us back to that, those moments of decisions are huge checks that you wrote into those companies. I would love to hear that story. thesis was that EVs were going to dominate the auto market and that EVs were an entirely different

kind of automobile like in that they were software. And it was a equivalent of like the iPhone versus a Motorola Nokia. The same way Motorola and Nokia were not able to move into smartphones because it was a hardware and a software. There were a few companies that would be able to do this successfully. Ultimately, audits are bad business. It could be software audits, hardware audits,

manufacturing didn't go as smoothly as it could have. And the cost of delays in manufacturing when you're ramping up and burning a lot of cash are quite significant. The technology

it was always good. And not getting up the manufacturing curve very quickly. Met, you didn't

“get the scale fast enough. And I really believe that scale in EVs can be important, which is why”

tests was one of the reasons why test was one. The IPO was great. It looked like a great investment. But ultimately, I don't know what our ultimate return was on Ruby and but it wasn't what we planned for when we made the investment. The bad ones tend to be more obvious faster. The great private tech investments, I think, are sometimes slower to prove how great they are because like you have these amazing founders who are just constantly making decisions which take the business in one

direction or another. And ultimately the compounding those decisions takes time but leads to great outcomes. Space Express is pretty obvious to me that the launch business and the minimum was going to be a very good business. And what they had achieved, I thought was just like from an engineering perspective insane. So to me, if I could buy a company that had achieved the most amazing engineering field I've ever seen had some multiple of revenue with very little cash burn at that point. I didn't

know what was going to come. I just needed the ski was very good. If they didn't achieve that,

“then like who knows what they could do in the future. What do you think about that business today?”

Like so much has changed since you first invested. What's your updated prognosis for it or

thoughts about it? The initial prognosis is always that like, you know, they're going to be a low

cost provider of launch. I think the success of Starship, I wouldn't say like we're fully there, but I think we're pretty much there. The proof for usability and scale, like yeah, okay, there's more to come. Starship is a game changer which we knew about fairly early on but didn't know if it would work. And what that means very simply is that the cost of launching everything goes down dramatically. 97, whatever a percent. And the engineering that they've done with the satellites

to harness solar power and be able to deliver really high speed bandwidth has surprised me to the upside. And there's a lot of software that goes into that too, just given these networks of satellites

“are all communicating. The modification that I think is that the telecom market globally is now the”

Tam. They've come so far down the cost curve. I think that in a relatively short amount of time, months, few years, they are going to be dramatically cheaper than any other form of delivering broadband. You said how much you love shorting stocks? What is it about it that you like? Because you just don't meet that many people that are focused on this or really that good at this anymore. My wife begs me all the time to stop shorting stocks. It's a bad business. You really have to be

intellectually stimulated by it. Most people in the market are just not fundamentally based period. And even if they are fundamentally based, they're not interested in shorting or they pretend like they're shorting and they're kind of shorted in disease or whatever. Very few people are doing it. There are tons of people investing in things that are just based on stories, like because of social media, because of Robin Hood. And there's just endless amounts of

shorts if you have duration and if you take a fundamental view. Why do you think markets are less efficient now? I think it's just the people transacting in the market or the nature of the institutions transacting in the markets. If you go back 10, 20 years ago, mutual funds, long short hedge funds, they were a big part of the market. Now it is a lot of passives, a lot of retail investors, people who are making investment decisions, they're not based upon long-term considerations of

intrinsic value. Quants even multi-manager, long short funds, while they are focused on fundamentals by necessity, they are short-term oriented. If you're focused on trying to get an edge in the short term, that is extremely efficient. And it's a game I just don't play.

You have firms which are incredibly sophisticated using amazing quantitative methods to go through

all their data. There's absolutely no edge there. Once you go beyond any kind of short-term event and you start to think about what is a business worth, what are the long-term cash flows, what are the portage five forces attribute to the company? That's when the competitive set gets pretty thin. And frankly, the more people focus on the short term, the more an opportunity there is to arbitrage that and have a medium term view. I don't think anyone knows it's going to happen

past three years for most companies. And for the economy as a whole, it's hard to predict. And so I don't consider myself to be an investor that just buys and holds things for

impact what we think the long-term value is, the majority of the time, the moves you see in the

“short term exaggerate to true change in intrinsic value of the company, which makes for a less efficient”

market. Your finance team isn't losing money on big mistakes. It's leaking through a thousand tiny decisions nobody's watching. ramp puts guardrails on spending before it happens. Real-time limits, automatic rules, zero firefighting. Try it at ramp.com/invest. As your business grows, vantus scales with you. Automating compliance and giving you a single source of truth, for security and risk. Learn more at vantu.com/invest. Every investment firm is unique and generic

AI doesn't understand your process. Rogo does. It's an AI platform built specifically for Wall Street connected to your data, understanding your process, and producing real outputs. Check them out at rogo.au/invest. The best AI and software companies from open AI to cursor to proplexity, use work OS to become enterprise ready overnight, not in months. Visit workos.com to skip the unglamorous infrastructure work and focus on your product. Ridgeline is redefining asset management

technology as a true partner, not just the software vendor. They've helped firms 5x and scale enabling faster growth, smarter operations, and a competitive edge. Visit RidgelineApps.com to see what they can unlock for your firm. One of the things that interests me a lot about you is, I'll use the word like a loyalty. So Jeremy's been your partner, he's one of your best friends from growing up, like everyone's your family office, your director, research, lots of your

“key partners. You've known a really long time and are good friends of yours. I think you made”

your wife in college. I did too, so I'm always always perks me up when I hear that example.

Do you say a little bit about how you feel about loyalty and kind of the role that all those data points suggest? There's a few things to consider. I know these people the best, and so I've just dealt with them through so many different things in life, and I have a lot of confidence in their confidence. So to me, there's a lot of people that I love in life for different reasons, and are wonderful people, and you know, would be loyal, but they have to be really

confident in the job. This is a very intense shot. The bar is extremely high, and the people that I've hired, that are friends of mine forever. I'm just confident that they're that bar by a lot. But when you are able to find people that you know for a long time, and like you before you had any money or any signs you'd ever have any money, that is a different kind of relationship. For me at this point, I don't know. They nice to me because they think I can do

something for them. There are a group of people in my life that have always been there, and that

they will be close to me for the rest of my life. And like to the extent I can work with those people, great, but as I said, they have to be excellent. One of the things that you do is for your portfolio to host this like group chat that's just full of your thinking on what's going on in markets. And one of the things that struck me the most about this is just how prolific you are in it. Like you're just thinking and writing about the shit at all hours, all the time.

Clearly like this is the thing that you just love and are passionate about. What has been the impact of that, like constantly communicating with the people that you care about about markets. I asked the question because I just want to give examples to encourage other people to do the same. It can be so powerful. When you're investing in a company privately, there is obviously a financial aspect to it. That's the driver. But there's also a relationship

part of it. Like in that you are signing up to hopefully help that person grow their business, be with them through ups and downs. And when you're doing the initial investment, you spend a lot of time together. But then I find that like it's very easy for me to go months without communicating with the CEO and the private side. It's nothing's happening. I don't like that. If we have something that we can offer people and they can just opt in, they can read the stuff

I write or not read the stuff I write. It is a way to broadcast communicate with people that I want to be in touch with and I want to know us better as a firm. Know me better as a person. Know us better as a firm. I find now even if I haven't spoken to a CEO in like three months and I call them, it's almost like they feel like they talk me every day. It's the same way like when you meet when I'm zoomed or a crow, you don't really

can never meet that person in person. I know that being a founder is lonely.

Going through all kinds of issues and so being around other founders, almost universally, the feedback I get is that founders like to be around other founders. Because there's the only people that can simply sympathize and understand everything that they go through. And so by having a bunch of them together in a chat, it's helpful to us for a business

“or something. But I think it's also just group therapy. We would be too strong of a word, but I think”

it's nice for them to know that these other people are part of this community that they're in and that they want to reach out to these people. They can and they hear these people's perspective. And some of these people are world-leading experts in areas like AI that are going to be impactful to companies that are not experts in AI. So just getting that input, I think is really helpful.

Not just my insights on markets, but having companies share insights with each other and seeing how the world is impacting companies. Do you care whether or not D1 has enterprise value as a business? Because that's something you think about. It's something I have to start to think about

more recently. I think the answer is no. Money to me is a score hard. No one has the best score.

It is a really great positive functionality of being a good investor. And maybe I will just be so endlessly interested by the idea of being a CEO that I want that go from being 10% of my job to

“30 to 40% of my job and that's how you create enterprise value. I'm just not there right now.”

And I want to deliver amazing returns. That'll be financially more than compensatory. Maybe one day, but I don't think hedge funds are a good business. Objectively, our business is horrible. It's amazing cash flows. Has no turnover value. I told this to my companies I invested. I'm like, you have no cash flows in terms of turnover value. I have tons of cash flows in terms of value. So we're good together. We can kind of arbitrage that. But I think there's other businesses

within asset management that have value. I definitely do not ever aspire to having hundreds of employees or something like that. And that's kind of what you need to do to have enterprise value. Why do you care so much about the score card? Like where does the competitive drive come from? This is what I've devoted my life to, right? And so if any devote your life to, you want to be great at or at least having an impact that is tangible and measurable. I can be a family

office right now. And there's plenty of positive things up being a family office. The drawback is like, you're not in the arena. I'm very collaborative with other investors. It's not like I'm sharp elbow. But being out there like being able to prove that we can be great. And not just me, like, our firm can be great is invigorating. I think I'd be kind of bored if I was just like investing my

own money. Going back to some of the history, something I've never heard you talk about publicly

is the early writing you did in value investor's club. And specifically the orthodonics of America sure case that you wrote about. I'd love to just hear the origin story of how you found Vic, why you started doing it. I'm very interested in this idea of how much can come if you do some great posting online. This is a very early version of this. So maybe just tell us the story of Vic and that early passion for stocks. It was 2002. I was working at a private equity group

“within Bear Sterns. I always had an interest in stocks. But the only way to really get exposure”

to investment ideas written up by hedge fund managers or investment managers was this site called value investor's club. You had the send in idea I applied and like every week you have tens of ideas posted by people and honestly you could read them. I would just consume everything. So it was like long idea. Short idea is every week they paid $5,000 to the best idea. I just got inspired by all the stuff I was reading and decided to try to find some of my own ideas. After maybe

six, 12 months I had a portfolio of things I'd written up on value investor's club and I decided I wanted to go work at hedge fund. First thing hedge funds ask you do is talk about investment idea and so I had all these investment ideas. One of the hedge funds I went to interview at it was a spin-off of SAC that did health care and they said to me we want you to do a case study for the interview. The company is called orthodontic centers of America. So I for me this was not

like a task. It was like the thing I was really excited to do because I had never had my work

given to somebody who was a professional. I went home and I spent maybe like hours and hours going through the financial filings and trying to build a model. I was pretty good accounting. I really tried to get deep into the financial statements and I really had nothing reconcile. Nothing made sense. It hit me that what they were doing was the simplest form of accounting fraud which is just capitalizing expenses that should have been expense in a big way. There are

other things too but that was the most egregious. I was able to effectively prove that. It wasn't in controversial proof but it was pretty close just by building up all the unit economics as they said they were comparing them to the unit level economics that you could actually decipher by going through their financial statements and it was clear I did a write-up that was about six pages long. It was good. It was well done before I went back to do the follow-up interview where I presented

“my case study. I was like I think I'm onto something here. Let me post it online first and I'll”

get some feedback. I wasn't allowed to trade stocks because I was working at an investment bank. So I wasn't sure at the stock. I wasn't on the stock value investor's club has done anonymously with a tag name. So I posted online within a few hours the stocks started to go down. I was like

a few hours later. Whatever I'm watching online there's some more posts being like this is really interesting. There's anyone double-check these numbers and there's people like commenting. Next day stock starts to create or stocks down like 23%. I started getting calls from people working at mutual funds who owned the stock because even though it was anonymous online

“I had told friends of mine hedge funds. I'm like you should look at this stock and”

shortly I think it's a fraud and they had told other people and so I started getting calls that bear stir and people at T-Roll price and fidelity. You were going to invest in bank. Last thing I was trying to do is posted like posting about companies in a fraud. I didn't know if you know they were a client. The stock just got had. I went back into the interview to present the case study at this point. They were just like what did you do? I was like look you told me to look at

this. I thought it was a fraud. If you're like did you tell anyone that we told you to do this? I was like no no you're like you sure and I'm like yeah nobody knows you know like we basically thought you were going to come back and tell us if they were going to miss earnings. I didn't want to do health care so I didn't work there but I now had this right up that could go around to different hedge funds. Most of them already knew about it because they would short it after the

“right up. That's why I got my job. You end up inviting you there for a long time to see I owe”

you got an incredible track record while you're there. If you think about the moment that you decided

to go start D1, bring us back to that moment to go hang your own single and build this thing. I started out as a bank journalist. That's what I did for the first couple of years. I still had a value band. I think most investors who love investing start out with a deep value event. If you want to read about great investors historically, most of them were a deep value investors. Ben Graham Buffett. I was working for somebody named Tom Perselle who's an amazing

investor. I really think Tom was an awesome mentor but I really think Tom was very well equipped to generate returns and financial services for biking and so if I wanted to grow my career, I had to move it to other areas. Gradually I took on other sectors like starting with health care industrial team T and the nature of those companies was different in banks. That was a learning process. It was just like years of covering different companies and different industries. The deeper you got

into what created value in TMT was different than what my creative value in industrial is where

health care. To me, if you love investing, my time of biking was amazing because I was able to

get exposure to every industry almost. By 2016, I was managing just over half of biking capital so we're 55% of biking's capital. And I had started out in 2002 being analyst with no portfolio. I had gone from no portfolio to portfolio to eventually CIO to managing more than half the firm's capital, which was an abnormal percentage historically for biking, biking's usually more diversified. It was pretty clear to me that from a business perspective, it was not in Andreas's best interest

to have one person managed more than half the capital. I don't think that'd be even good for LPs. And so I kind of recognized that I had pretty much achieved what I couldn't achieve at biking. Over time, I'd be probably managing a smaller percentage. Almost regardless of how well I did.

I've always had a mindset of like, I want to grow, I want to get better, I want to achieve new

things. And I kind of felt like there wasn't that much more to achieve as biking. And I was 40. I started to fund relatively late in life. And I kind of recognized that at some point you just wouldn't have the energy to go do something like starting a fund as obviously it's a big endeavor. I felt like I had the energy and so everything kind of came together. What interests you about art? Like it's something that obviously you care a lot about,

you've devoted some time to understanding, what is it that attracts you? I've always had more of a leading towards humanities than STEM, which is unusual and certainly tech and somewhat finance. That is why I perhaps look at my job as more art and science. The science is very simple. The DCF, I've learned how to do it for 25 years ago and it doesn't change. The humanities side interests me and art is certainly one aspect of that. And I am particularly

interested in aesthetics. I like design. I like architecture. I like art. To me, like it's just beauty. You go to the beach and like watch the way if that's beauty. Like there's beauty in the world and like art is a one example of beauty. There's usually a story behind it and there's people behind

“art. Art is important because it's created by people. And I think the goal case in art would be”

as everything else is automated and infinite supply because it's being created by AI. Art created by people reflects emotion and oftentimes like what's happening in the moment in the world when

idea, the beautiful idea, what is most beautiful business you've ever seen? It's like the best

business you've ever seen. I think that the best businesses are usually low-cost producers of something that's very durable and I think people underestimate like the ability to provide a given product of service sustainably at low-cost and where there's a positive feedback loop of like low-cost, transmoir of AI and with drives low-cost. And I think I can say like a bunch of businesses which are really great like moody's or SNP. Those are great businesses when you're wrong. But

something where the cost advantage is so substantial and so impenetrable like SpaceX with launch or

“Costco with groceries. To me it's like the only way to win in most businesses is to”

provide a great product at a low-cost businesses that do that at scale and deal the motor around it

are amazing. Amazon decommers businesses is amazing. So many amazing businesses. Very few monopolies

and when they are monopoly, usually it happens as they tend to get lazy and the returns are as good. What parts of the world do you think are underappreciated right now? Like when I look at your top 10 holdings actually like didn't recognize and the number of the companies less of them were not in the U.S. They're no national. Where is your eye right now? Do you think the world does not pay enough attention to? It's hard to say Europe in like Europe is economically stagnated

so I'm not sure anyone should pay attention to it other than if you are a pure fundamental stock picker it's an easier market. I think there's really interesting things happening in Asia just as globally as politics change. Like you saw what happened Japan and for the first time Japan is probably going to become a military power at some point in the future again and you know that has

“all kinds of implications. I think there's a lot going on within defense. I think there's obviously”

AI geographically Europe is always the most inefficient. I think Japan and Korea are probably

pretty inefficient as well. A lot of retail investors, some really great companies. Japan and Korea were not well positioned for the last 20 years because it was just like digital companies but when it comes to like actually hard assets and good engineering, Germany, Korea, Japan have a lot of companies that have excellent physical assets and engineering. Is there anything else that we haven't talked about today that you have on your mind or your especially passionate about things you're

thinking about in the world? Doing it troubles me to most frankly is I think we are on a collision course with China over semiconductors or I think there are ways to get out of that but none of them are easy to the extent that we don't figure that out. We're going to have something akin to the great depression. Say more about that, how would that come past? It's very straightforward in the Taiwan produces 90% of the most advanced semiconductors and everything we use is semiconductors. It's almost

as if you went back 50 years if there's only one country that produced oil. I mean oil was that important. We went to war over oil even though you could get it all over the world. Taiwan produces vast majority of living semiconductors and that is with powers everything and that supply chain is fragile. It's not like it's easy to replicate. It's easy to destroy. If that supply chain were to get screwed up or discermediated, we would have a incredibly bad economy on the order

of depression type economy. Probably a lot of people in government understand this. I've heard

“it's got best to talk about it. I think people understand it. There are some scenarios that are”

okay for the global economy but there is no scenario I can think of where everybody's happy. China's happy, Taiwan's happy and the U.S. is happy. Somebody's going to be unhappy either because the economy collapses or because their sovereignty is handed over. Where do you hope happens? That we build fabs here? What I hope happens is that we replicate the supply chain over time in the U.S. and we work something out with China where they see a path to integrating Taiwan. I think that

if we replicate the supply chain, the risk is that we're probably less likely to defend Taiwan, in which case China will attack Taiwan anyway. Bad for Taiwan, fine for the U.S. trying to choose its objectives. I would like to see the world avoid depression and that's going to require like I think some understanding of we need 10 to 20 years to replicate this supply chain. Over that period of time, China will not screw up the world economy by being very aggressive with

Taiwan and then eventually there's a path for China feels comfortable that they will be able to reintegrate with Taiwan. Usually when dictators say they say something and they say it like

he may not have the capabilities, but as soon as he did, he acted on it and so every time she makes a speech that's at any importance in China, he emphasizes Taiwan and so we can pretend

“like this is going to happen and in some time it's not relevant, but it's so important and AI”

just raises the stakes so much that it would affect everybody. Is that coming to ask you what you've learned or what you like about the real dictators podcast? I like history, as soon as it's like listening what's happened in history and how many horrible leaders there are,

it's like the Charlie Munger say like tell me where I'm going to die so I never go there.

Learning about bad things so you don't go there to me is it's interesting whether it's like communism or fascism, it's just like all of these things are still possible and relevant in modern day, understanding how things have played out in the past and it tends to repeat itself like communism starts but like communism without dictatorship doesn't work because eventually people realize it's not good and so then they want to change and the only

“way it doesn't change is if you have a dictator who's really benefiting from all this.”

That to me is like interesting just because the world a lot more things have gone wrong in the world than right in our lifetime things have gotten right technologically geopolitically but over history more things have gone wrong. Good leadership can be as impactful or more than bad leadership you've worked with a lot of invested in a lot of great leaders. I'm wondering specifically around CEOs but broadly about leadership like what are you looking for in a leader

that you back? Real passion a strong competitive streak desired a win deeply engaged in the business somebody who like knows the details when you talk to them somebody who people want to work for and that could be because they like the person personally or it could be because they don't necessarily love the person day to day like Elon Musk I'm sure in the factory is not like all giggles but people are like I'm going to learn more by working with this person.

Buffet always says like the business is more important than the leader. I kind of disagree with

that I think if you look over 30 years sure but over any being in period of time like businesses are just people and if you have amazing people they make great decisions and bring great people

“and my investing time frame is like five to ten years max and I think people are more important”

that time frame especially technology businesses. I think it's come through today that you are clearly one of the most passionate stock picker is stock people markets people that's active today most say like these things just to be inspirational to other people that might want to do the same thing so it's been so much fun to do with you. I ask everyone the same traditional closing question what is the kindest thing that a name is ever done for you? With my wife right now I was

a pretty bad boyfriend in college and that like I was busy doing other things and I was not very attentive I was not like somebody that you'd want to like necessarily marry it and we broke up and I remember I sat down here and I said like you know we went to get a drink and just to catch up as friends and I said I got a job at Bear Serves and I just remember like she just started crying I was fine but it wasn't like I was Goldman Sachs knocking out my door to get me to go

I didn't really work for the first three years of college she just started like crying like tears

a joy and I was like wow like this person who I really didn't properly appreciate how much they cared for me how the one they were and like how much they were rooting for me to me like it wasn't an act that was kind it was just a gesture that I was like I was going to take him back what and immediately I walked out and I was like I'm going to marry that girl and I'm going to be a better boyfriend slash husband going forward I love that story I haven't heard like a specific

moment quite like that one and all the 500 times I've asked this question so then awesome place to close thanks for your time awesome thanks Patrick if you enjoyed this episode visit Colossus.com you'll find every episode of this podcast complete with hand out of the transcripts you can also subscribe to Colossus or quarterly print digital and private audio publication featuring in depth profiles of the founders investors and companies that we admire most learn more at Colossus.com/subscribe

you know how small advantages compound over time that's true in investing and just as true in how you run your company your spending system is your capital allocation strategy ramp makes it smarter by default better data better decisions better economics over time see how at ramp.com/invest as your business grows vantus skills with you automating compliance and giving you a single source of

technology as a true partner not just the software vendor they've helped firms 5x and scale

“enabling faster growth smarter operations and a competitive edge visit RidgelineApps.com to see what”

they can unlock for your firm the best AI and software companies from open AI to cursor to

complexity use work OS to become enterprise ready overnight not in months visit workos.com to skip

“the unglamorous infrastructure work and focus on your product every investment firm is unique and”

generic AI doesn't understand your process. Rogo does. It's an AI platform built specifically

for Wall Street connected to your data understanding your process and producing real outputs. Check them out at rogo.au/invest