Podcast

Episode 39: January 2021 Strategy Update

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MICAHEL FRAZIS     |     4/6/2021

SALT interview with Rachel Pether

SALT interview with Rachel Pether

Hello all, I recorded the interview above with Rachel Pether from SALT (the alternative investment conference/forum founded by Anthony Scaramucci).

Michael Frazis

Portfolio Manager, Managing Partner

This Weeks Guest.

Robert Stretch, MD

 

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1.40 – Quick review of 2020 

2.35 – How to survive huge market swings like March 2020 and 2008-2009 

3.45 – Discussion on support mechanisms in place in equity markets (central banks, fiscal stimulus, actions by management teams, etc) 

5.45 – Current investment strategy is to stay invested & make sure we are constantly holding winners 

7.35 – Sound fundamental reasons why companies with intense customer love, explosive growth, and market leadership perform so well 

8.15 – Our companies are investing heavily. When revenue comes in they open new offices, hire marketing staff and etc which promises a greater return on investment. Many categorise these investments as costs, which gives the opposite (incorrect) answer 

10.17 – Investment in tech and the “companies of the future” requires long term investment with value creation over 5 – 10 years 

11.50 – Question: Have you invested in Nio? Nio capitalises on the necessity of an electric China. There is demand in the Chinese economy with issues like pollution for electric vehicles and the vast majority of the population will be buying locally made vehicles. Nio is a 100%+ revenue growth company and has proven user base in China 

13.25 – Question: When do we trim? Focus of maintaining diversified portfolio of ultra-high growth companies 

14.25 – Long term goals of the fund 

16.17 – Question: Is there a limit to when printing to support the economy triggers inflation? Austerity weakened the private sector as seen in the UK and saw mass unemployment 17.14 – Comparison with the Australian experience 

18.08 – The Greek experience with austerity, and how growth can be the solution to an economic crisis 20.20 – Worries around debt overhang have been consistently proven wrong for countries like Australia, Japan, UK and USA anyway 

20.50 – Question: How are you investing in the life sciences? 22.23 – Discussion on liquid biopsy and Dermtech’s sticker approach to melanoma 24.00 – Question: What do we think about SPACs? 

26.20 – Question: what didn’t work in 2020? A few biotechs underperformed, like Avita 

27.40 – Discussion on Moderna now that vaccine is approved 

30.33 – Market outlook: Market is changing with stimulus, vaccines and substantial changes in leadership with low interest rates 

30.45 – At the highs of January 2021 we aim to stay consistent & ensure our portfolio companies are adding users and revenues everyday at the highest possible rates, just as we did in the lows 

33.10 – Question: What do we think of high quality but richly priced companies like Crowdstrike? 

33.23 – 2021 focus on life sciences – the space is independent over the growth space & captures novel explosive growth 

34.10 – Always searching for companies that grow 100% year on year, trading on five-time sales  

34.25 – Why we never bought Spotify 

35.10 – Question: Are we in a tech bubble? 

44.30 – Conclusion: we remain focused on our diversified portfolio of ultra-high growth companies intense customer love, long term

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