Compounders Podcast

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Welcome to the Compounders Podcast. On this show, Host and Investor, Ben Claremon, will explore the topic of compounding from various angles, including through interviews with public and private company executives, investors who focus on compounders, and newer investment firms that are building a business they hope will become more valuable over time.

Episodes

Tuesday Jun 13, 2023

The Underappreciated Power of Data Companies with Thomas Li, Co-Founder and CEO of Daloopa

Tuesday Jun 13, 2023

My guest on the show today is Thomas Li, the co-founder and CEO of financial data company Daloopa. Daloopa is a private company that was founded by a group of former buy-side investment analysts who saw the opportunity to use technology to upgrade the research process at just about any type of investment firm; but with a specific focus on saving analysts and portfolio managers time. Just a few years into its journey, the company already has over 200 employees and has multiple offices around the world.

In this wide-ranging interview, Thomas and I discussed:

Where the original idea for Daloopa came from;
How he views the legacy data providers such as CapitalIQ and Bloomberg;
What Daloopa is doing to make the product a must-have versus a nice-to-have;
What AI means within the context of Daloopa; and
The importance of building a company that naturally generates a lot of cash

As a disclaimer, Daloopa is a sponsor of the Compounders podcast. Cove Street nor Ben Claremon are shareholders of Daloopa.

Without any further ado, here is my conversation with Daloopa CEO Thomas Li. For more information about Daloopa, please visit: https://daloopa.com/

This episode of Compounders: The Anatomy of a Multibagger is sponsored by Daloopa. Daloopa was founded by a former hedge fund analyst to bring simplicity to the investment process. Daloopa offers an AI-driven, single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time. For more information, please visit: https://daloopa.com/

To get all the latest updates about the podcast, see who we’ll have on next, as well as watch the video version of the pod, please follow us on twitter at @BenClaremon and subscribe to the SNN Network YouTube Channel at www.youtube.com/snnwire.

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

All opinions expressed by your hosts and the podcast guests are solely their own opinions and do not reflect the opinion of Cove Street Capital or any affiliates. This podcast is for informational purposes only, it is not investment advice, and should not be relied upon for any investment decisions. We are not recommending the purchase or sale of any securities. The hosts and guests may be beneficial owners of the securities discussed. You should not assume that the securities discussed are or will be profitable.

Tuesday Mar 07, 2023

Building the Modern Payments Network for Truckers with Aaron Graft, Founder & CEO of Triumph Financial (NASDAQ: TFIN)

Tuesday Mar 07, 2023

Our guest on the show this week was Aaron Graft, the Founder, Vice Chairman and CEO of Triumph Financial. Just as the impacts of the Great Financial Crisis were waning, Aaron led a team of people who took over a failed bank to create Triumph. Aaron has been CEO since the beginning and has been instrumental in transforming the bank into a transportation-focused industry leader. Specifically, Aaron has helped turn what was a small factoring business into a high margin one that buys $1 billion in invoices from truckers every month. In recent years, Aaron has turned his focus to building a payments company that caters to all of the constituents in the trucking industry. In this fascinating discussion, we covered:

The benefits of having a bank structure despite Triumph not being a typical community bank;
How the company has built the factoring business over time and why it is so profitable;
The vision for Triumph Pay and the path to building it into something much larger; and
Why the company has been so aggressive in repurchasing its own shares

For full disclosure, Cove Street is NOT a Triumph Financial shareholder.

And without any further ado, here is my conversation with Triumph’s Founder, Vice Chairman and CEO, Aaron Graft. For more information about Triumph Financial, please visit: https://www.tfin.com/

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Thursday Sep 08, 2022

The Enduring Benefit of Running Permanent Capital Vehicles with Craig Packer, CEO of Owl Rock Capital Corporation (NYSE: ORCC)

Thursday Sep 08, 2022

Our guest on the show today is Craig Packer, the CEO of Owl Rock Capital Corp, a 5.4 billion dollar market cap business development company that invests in middle market companies in the US. Craig is also the Chief Investment Officer of Owl Rock Capital, a New York-based direct lending platform with over 50 billion dollars of assets under management. This is the first business development company—or BDC for short—we have had on the podcast, so we wanted to make sure that we spent some time talking about BDCs in general and why Craig thinks they are an attractive niche within public markets. Additionally, in the discussion with Craig, we covered:

What metrics investors should focus on when they are considering investing in a BDC;
Owl Rock Capital’s investment philosophy and risk management strategies;
How Craig would expect the BDC’s portfolio to perform in an economic downturn;
What kind of investment opportunities Craig and his team are seeing at the moment; and
The proper use of leverage within a BDC structure

This episode of Compounders: The Anatomy of a Multibagger is sponsored by Tegus, an innovative and disruptive company that is changing the way professional investors work. For more information, please visit: https://www.tegus.co/

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Wednesday Aug 31, 2022

Consolidating the Mechanical and Electrical Contracting Industries with Brian Lane, President and CEO of Comfort Systems USA, Inc. (NYSE: FIX)

Wednesday Aug 31, 2022

My guest on the show today is Brian Lane, the President and CEO of Comfort Systems, a 3.6 billion dollar market cap company that provides mechanical and electrical services, including installation, repair and maintenance, to customers in the US. Brian became CEO in 2011 and over the last 11 years, has overseen very impressive revenue growth and stock performance. The company has consistently made acquisitions over the last decade but still has a ton of white space left domestically. Given Comfort Systems’ track record and runway for future growth, it was great to talk with Brian about:

The company’s acquisition philosophy and what it adds to the companies it acquires;
How the company is approaching a potential recessionary period in the US;
The process by which Comfort Systems has built up a recurring revenue base;
The structure of the industry from a competitive perspective; and
How the company is overcoming both inflationary and labor availability challenges.

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Wednesday Aug 24, 2022

Using Canvas to Ensure Access to Education for Everyone with Steve Daly, CEO of Instructure Holdings (NYSE: INST)

Wednesday Aug 24, 2022

Our guest on the show today is Steve Daly, the CEO of Instructure Holdings, a 3.6 billion dollar educational software company. After serving on the Board of the company, Steve became the CEO in late 2020, right in the middle of pivotal time for the company. Instructure’s core products consist of cloud-based learning management systems used by higher education and K through 12 schools all around the world. Listeners may not be familiar with Instructure, but the Canvas brand is likely something many people have heard of or even used.

In 2020, the COVID outbreak presented all kinds of challenges for schools, especially when it came to figuring out how to use technology to continue the education process in a remote environment. Given how well Instructure is positioned to help schools embrace new technologies, I was excited to hear from Steve about:

How the outbreak of COVID impacted the demand for learning management systems in both higher ed and K through 12;
Why cloud systems are better than on premise systems and how that leads to very low churn among customers;
Penetration rates of learning management systems across end markets and the different strategies Instructure employs to grow;
How the company went from being quite unprofitable to generating very attractive margins in a short period of time; and
How Thoma Bravo’s Orlando Bravo convinced Steve to join the Board of Instructure and eventually become the CEO.

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Wednesday Aug 17, 2022

Putting the Customer First for 90 Years with Scott King, CEO, and Jeff Gorman, Executive Chairman of The Gorman-Rupp Company (NYSE: GRC)

Wednesday Aug 17, 2022

Our guests on the show today are Scott King and Jeff Gorman, the CEO and Executive Chairman of The Gorman-Rupp Company, a 700 million dollar market cap company that designs, manufactures, and sells pumps and pump systems to customers all over the world. 2022 has been quite an eventful for year for the company. Earlier in the year, Jeff Gorman stepped back to Chairman, allowing Scott to become the CEO, despite not having the Gorman last name. The company also completed a very large acquisition of a company called Fill-Rite. Given those events and all of the other challenges in the world today, I was excited to speak with Scott and Jeff about:

The timing of the management transition and the expectation that Scott continue the company’s long history of dividend increases
The rationale for the Fill-Rite deal and why now was the right time to take a big swing—with some leverage;
The importance of culture and the family-like values that have persisted over the last 90 years;
Where the company is investing in technology and innovation; and
How the company approaches tough economics times given all of the different crises the company has weathered during its long history

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Tuesday May 10, 2022

The Building Blocks of a 100-Bagger with Chris Mayer, Portfolio Manager at Woodlock House Family Capital fund

Tuesday May 10, 2022

My guest on the show today is Chris Mayer, the Portfolio Manager of the Woodlock House Family Capital fund and the co-founder of the firm. He is also the author of 100 Baggers: Stocks That Return 100-to-1 and How To Find Them. You will notice that we are doing something a little different with this episode. Chris is our first guest who is not an executive at a public company. But, since this podcast is called Compounders: The Anatomy of a Multibagger, we thought it would be great to have on the guy who literally wrote the book on finding 100-baggers. In this wide-ranging interview, Chris and I discussed:

The common attributes of 100-baggers Chris found in his study of compounders;
The biases that make it hard for investors to realize a 100-bagger;
Why individual investors might be more likely than are institutional investors to get the full benefit of decades of compounding;
Where serial acquirers fit within the 100-bagger paradigm; and
Why high incremental returns on capital are so important to long-term success

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Wednesday Apr 27, 2022

Riding the Wave of Warehouse Outsourcing and Automation with Malcolm Wilson, CEO, and Mark Manduca, CIO, of GXO Logistics (NYSE: GXO)

Wednesday Apr 27, 2022

Our guests on the show today are Malcolm Wilson and Mark Manduca, the respective CEO and CIO of GXO Logistics. GXO is a 7-billion dollar market cap company that provides logistics services to companies around the world. The company was recently spun off from XPO Logistics and now has the freedom to invest aggressively to helps its customers with supply chain and warehouse automation. COVID, supply chain disruptions and rising labor rates around the world have made many companies start to think deeply about their supply chains and to consider outsourcing and automation. As such, given how well GXO would appear to be positioned for the future, I was really looking forward to talking to Malcolm and Mark about:

The rationale for the spin and what having more autonomy will allow GXO to do;
The structural tailwinds that are behind the company as it relates to e-commerce, outsourcing and warehouse automation;
Why GXO is definitely not a commoditized warehouse company;
Why the company is a buying Clipper; and
The importance of return on capital when it comes to capital allocation

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Wednesday Apr 13, 2022

Driving the Healthcare Industry to Embrace Non-Invasive Ventilation with Casey Hoyt, CEO of Viemed Healthcare, Inc. (NASDAQ/TSX: VMD)

Wednesday Apr 13, 2022

My guest on the show today is Casey Hoyt, the CEO of Viemed. Viemed is a 196 million dollar market cap company that provides in-home durable medical equipment (DME) and post-acute respiratory healthcare services to patients in the United States. The company has developed a specialty in providing non-invasive ventilation to patients with chronic obstructive pulmonary disease or COPD. Casey took over as CEO in 2017 and has helped the company grow its revenue meaningfully over that time, even accounting for the COVID headwinds the company has seen over the last few years. Given Viemed’s impressive recent track record and the amount of white space it has to continue to serve even more at-risk patients, I was looking forward to talking to Casesy about:

The elements that have led to such rapid revenue growth;
The attractiveness of in-home care relative to acute and outpatient case;
The size of the COPD population in the U.S. and how Viemed can increases the penetration of non-invasive ventilation;
How the company is attracting and retaining talented people in a very tight labor market for healthcare workers; and
How the company thinks about adding new products and services to its current offerings.

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.

Wednesday Apr 06, 2022

Joining the Ranks of the Great Industrial Technology Companies with Tom Logan, CEO of Mirion Technologies, Inc. (NYSE: MIR)

Wednesday Apr 06, 2022

Our guest on the show today is Tom Logan, the CEO of Mirion Technologies. Mirion was founded in 2005 and Tom has been the company’s only CEO over that period of time. Mirion is a global leader in radiation measurement, serving end markets such as nuclear, life sciences, healthcare and industrial. Mirion recently became publicly traded via a SPAC, but unlike many other de-SPACed companies, Mirion has a long operating history and generates positive EBITDA. The company has had to weather a number of headwinds over Tom’s tenure, including the Great Financial Crisis, the Fukushima nuclear disaster in Japan, and of course COVID. Despite that, the company has grown consistently through organic and inorganic means and expanded its margins meaningfully. With all of that as a backdrop, I was excited to talk to Tom about:

The current state of the base of nuclear power plants around the world and how the Russia-Ukraine conflict is impacting nuclear policy;
How the company is positioning itself to grow within the medical end market;
What he has learned from Mirion Chairman Larry Kingsley, who achieved tremendous success as CEO of IDEX and Pall Corp.;
The elements of the business model that lead to sticky, recurring revenue; and
How the company hopes to achieve its mid-single digit growth algorithm

For more information about Cove Street Capital, please visit: https://covestreetcapital.com/

iTunes: https://apple.co/3xlUvPY

Spotify: https://spoti.fi/3jxkxLl

Each new episode will be available every Tuesday morning on Apple, Spotify and all podcast streaming platforms.