The Moat Portfolio

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[00:02:15] – Pat’s methods for valuing a business

[00:04:17] – Is this process done after they would first identify potential targets for investment

[00:05:11] – Pat’s take on how the market classifies stocks as growth vs value

[00:06:40] – Qualitative insights and why the market can’t price them very accurately

[00:09:57] – The business model behind zero marginal cost distribution business model

[00:12:00] – Network effects and the potential downside to them down the road

[00:13:54] – Valuing Facebook as a business heavily reliant on network effects

[00:16:45] – What would have to change for Pat’s position on Facebook to radically change

[00:18:58] – Most important lessons that a smaller/private business could learn from Facebook or Google’s business models

[00:19:48] – Where is Amazon in Pat’s portfolio

[00:20:27] – Primary research and the value that is derived from it

[00:22:06] – An example of where primary research led to a big surprise about a company

[00:24:05] – The value of travel in this business, starting with recent travel to India

[00:26:05] – Why are they targeting India and Japan

[00:27:24] – How does he think about the risk of investing in foreign markets

[00:29:52] – His thinking on relative vs absolute market share

[00:31:26] – Exploring the SaaS business model

[00:34:35] – The application of moats and pricing power with SaaS businesses

[00:36:17] – Understanding how to evaluate a SaaS or subscription-based business (Lifetime Value of the Customer vs Acquisition Cost)

[00:40:07] – Other models that Pat explores and how to screen for them

[00:41:37] – How does he parse the difference between attention and demand

[00:43:19] – How would Pat monetize something like HQ – Live Trivia Game Show that has aggregated massive amount of attention

[00:45:19] – How does Pat react to the idea that attention is scarce and human capital is so crucial

[00:47:04] – How does Pat evaluate human capital in a business

[00:48:09] – Experience in starting an asset management business

[00:50:20] – What are the levers that are biggest value drivers in the asset management business

[00:53:57] – Pat’s view on the strength of the relationship between risk and return

[00:57:06] – The most risk Pat has taken in the face of uncertainty

[00:59:23] – Favorite recent learning resource