YouSaid · the spoken record

Andrew Milgram

lines on the record: 113
first: 2025-08-05
most recent: 2025-08-05
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“We need to shrink congestion, get cars off the street so that the city can operate. They introduced the medallion system. Look, that basic intuition, that basic imperative hasn't changed. In the world of autonomous, actually, I think it accelerates in some ways. You and I are sitting in Greenwich, Connecticut. While we were doing this interview in a fully autonomous world, theoretically we could sit down and send our cars to do a little work in New York while we're doing this. They'd be back by a certain time. That's not great for New York City's operation. I would also say that people with less scruples might say, go down to New York City and work, but don't take any rides north of 125th Street. Things that would just be absolutely repugnant operationally, but also in strict violation of New York City's operating rules around taxis and how rides can be taken and service.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“I think there is legitimate concern about what the shape of this market looks like as we go into things like autonomous vehicles. What does the future hold? I think the almost simple tons answer to that is, oh, well, you can't fight technology. And the reality is while I think autonomous vehicles pose a real threat to the livelihood of the individual driver, when I separate driver from asset and I think about what our New York City's interests, I think the medallion has, again, persistency to it. The medallion system was introduced in the 1930s by Fiorella Laguardia, the famous mayor at the time, under what was called the Haas Act. Because in the days during and after the Depression, New York City streets get super clogged because people were out of work and they would get in their car and drive people around as a service. LaGuardia looked at the system and said, this is terrible. Nobody can get a”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Actually, just a few weeks ago, we took our entire taxi operation public. That business will persist. It should have a very durable and persistent cash flow that should be able to be valued by the market. And I think there's some pretty exciting and compelling things that we can do in continuing to grow that operation, add other services, other pieces of the ecosystem in, because the ecosystem does work. It had been too disaggregated. There were too many people taking a profit margin out of it. The reality is needed to be much more efficient. We needed to be much more cost constrained. We needed to be much more operationally focused on efficiency and delivering to the customer. The customer wasn't getting enough value out of the relationship. The only way you can give that customer more value is that somebody else gets less value. And the only way you can squeeze those margins is through consolidations and efficiency. So that's where this market ultimately goes, where I think the obvious sort of candidate to do it.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“The leadership of the Taxi Workers Alliance would agree we continue to have a very constructive, productive, and partnership-like relationship.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Tell me what you need. Tell me what's going on. We ultimately did do that across the table from each other in a conference room. But the reality is you get a sense of things by really going and speaking with people and understanding really what's driving their decisions and how they really are interacting with you or the problem that they're facing. And by spending time with drivers in informal settings like that, but also formal settings with the taxi workers alliance and particularly with the leadership of the taxi workers alliance, I found their concerns to be completely valid and real. I thought that the pressures they were facing were obvious and unavoidable. It was very clear to me that the system was not working for them. And in order for the system to thrive, again, they're my customer. I needed it to work for them. And so we began a really constructive conversation and relationship with the taxi workers alliance. I'm very happy to say.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Described earlier, there was this contentiousness in the space, labor, operator, capital. Nobody really even talked to each other, much less liked talking to each other. As people figured out that Marblegate was playing a larger and larger role, one of the first things that happened, our offices are here in Greenwich, Connecticut. We were picketed by the Taxi Workers Alliance, which is the de facto union for the space. Now, one of the things I'm most proud of is we had water and sandwiches delivered to them. It upset my team. And I actually don't even think the taxi workers alliance knows this, but I actually put on a baseball cap and a t-shirt and went out and marched with them and talked to the drivers.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“We were doing broadly. We were making sure that the people who would be most interested and the people who were going to have the most political sensitivities to this were informed and well informed. So by going out and getting in front of that, as we became large, I would say had a very constructive dialogue with everybody in the system. I think the other thing that we did, again, I think that has worked to our benefit over time.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“But I think one of the good pieces of advice that we got actually from Risa Heller, who runs a firm called Heller Communications, who has advised us throughout this. And Risa had come out of Chuck Schumer's office and has a great connectivity into the New York political scene generally. She said to me very early, you need to go explain everything you're doing and plan to do to every regulator and politician that touches this or is interested in this. And so we spent a lot of time going and seeing individual council members, individual regulators, went to the mayor's office, sort of laid out for them, look, these are the problems we see. This is what we think the solution set looks like. We think it's going to be difficult, but we think the outcome looks like the following. And by being transparent about what our plans were, even though we weren't advertising ourselves or”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“About ultimate resolution. So when we got deeper in, so we ultimately became by far the largest lender in the space, by far the largest participant.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“There about could they help us? And the answer for 97% of them was absolutely not. We want nothing to do with this. Politically sensitive, tough space, tough borrowers. Borrowers will spend two, three months out of the country, typically going back to their home to spend time with family. Just a setup that a lot of servicers didn't want to take on. The servicers who were even willing to have the conversation, which there were only a couple, their pricing was self-extractive. There was no way we could do a deal. So we actually stood up a servicer to service the space, which today has almost 30 people in it, a collection of lawyers, paralegals, phone bangers, people sort of calling borrowers. Anyway, as we thought about taking down the government's paper, they wanted to understand how we were doing that servicing and how we were enforcing if that was necessary and what our thoughts were.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Wanted to make sure that the way we were going to deal with the borrowers in the space respected the dignity of the borrower, that we were not going to be a rapacious, all of these loans had personal guarantees. And so drivers who had leverred up to buy a taxi medallion had really at risk their home, their livelihood, everything. And the NCUA understood that we needed to be commercial, but also wanted to make sure that we weren't going to be abusive to the borrowers. And so they spent a lot of time understanding how we were dealing with problems. Now, a part of the story I left out earlier is that we ended up with 4,500 individual line items in this portfolio, prosecuting that is just a huge lift. You have to send out bills every month. You have to collect. You have to call people when they don't pay. So there's a servicing aspect to this. We went to speak to virtually every servicer out there.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Consultants, all of them point out New York City has a hard time operating without taxi medallions. Also, it's a meaningful portion of the New York City budget. So for all of those reasons, we felt like New York City would take a pretty active role in supporting it. The market understood that for years and years. So the haircut on a credit unions loan was next to nothing. If you were a credit union in New York, you could not lend to the space. It was so profitable. Now with a sharp decline in assets, the NCUA, which is the FDIC of the credit union space, essentially seized a number of those credit unions. So it ended up that the largest lender to the space was the federal government. That allowed us to begin a conversation with the federal government, with the NCUA, about acquiring those assets. That took a long time for one really important reason. The NCUA”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So we went to the federally chartered banks, we went to the largest portfolio, and began a negotiation with them, moved through that pretty quickly and took that portfolio over. That automatically made us the largest independent lender into the space. Also, now you have multiple transactions. The largest group of lenders into the space were the credit unions. The credit unions faced with the prospect of a sharp decline in the asset value on their balance sheets found themselves essentially insolvent because prior to 2015, ultimately 2018-19, when this part of the story is happening, taxi medallion loans were considered gold because they remain an important part of New York City's infrastructure. When you talk to New York City, to the regulators, to transportation departments, city planners, transportation.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“The lenders we had talked about, and they wanted to engage at much more reasonable levels. We ended up buying the largest portfolio available from a federally chartered bank. It's an important understanding when you're dealing with banks what their regulatory scheme is, state chartered banks, credit unions, federally chartered banks. They all have slightly different ways they operate and how they're regulated. Because at the end of the day, banks always make decisions for three reasons regulatory, regulatory, and regulatory. People think of banks as economic actors. They're not. They're regulatory actors. So this compromise their regulatory position for a federally chartered bank, those tend to be much larger banks. This was a very small piece of their portfolio, and so they can more quickly get to a place from an earnings power impact and a balance sheet impact that they would dispose of the portfolio at a sharp discount.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So I said, great, you're done. We went through the auction and the way the auction rules worked, you had to buy all of the medallions or really didn't satisfy the lender's needs. And the truth was, the combination of the way we structured the bid and the auction rules were such that it was going to be really hard for anybody other than Marvelgate to win the auction. So we walked away with 48 outright medallions. But most importantly, we had created a mark that we then had hand delivered to every lender in the space. Now they had direct evidence of a meaningful number of medallions transacting at a level way below where they had previously estimated it would. And by the way, we did that to them at the very end of November, beginning of December. So they're looking at a year in mark that didn't feel so great. Surprise, surprise come January conversation becomes pretty serious with a number of...”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Said stalking horse better. We're going to go to the airport Marriott and open outcry this. I said, listen, call the lender up and tell him that I'll be a stalking horse. He said, okay, what price? Now, I gave him a price that was way, way, way below $350,000. $150,000 per medallion. And he said, Well, they'll never do that. But it's a free option. I'm the backstop. We'll do the open outcry where your backstop. So he said, okay, well, I'll call them up. About an hour later, he called me back. He said, they won't do a penny less than 160.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“And we think you're going to have to restructure large portions of this market. So there's a lot of work and time that's going to go into it. Both of those things, we and our investors are going to need to be compensated for. So we were walking around talking to all these banks and really nobody wanted to transact with us. And then God smiled on me one day. A guy by the name of Gene Friedman, who the post used to like to call the taxi king of New York, had gotten in a fight with his lender, which was Citibank, and Citibank had exercised remedies against him, seized his collateral, and we're going to auction it off. Now the auctioneer was a guy out in Brooklyn that we knew, and we called him up and said, hey, do you have a stalking horse bidder for these medallions? By the way, it was 48 outright medallions, not loans, outright medallions.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, actually, our first investment was definitely, I knew at the time, but clearly in retrospect, the riskiest trade that we did. As we went around and talked to banks, they would say, well, hasn't been really any transactions like many markets. One of the good indication of when a sector or a company is going to tipple over is it gets super illiquid in its securities or loans or whatever. The taxi market had gotten super illiquid. There were no medallion transactions happening. Buyers and sellers moved too far apart. Nothing ends up happening. And one of the all-time great indicators of when something is going to really sharply move. So there had been no transactions. And the banks were saying to us, well, look, there's no transactions happening. We'll give you a discount because we know it's not great out there. But we think maybe $350,000 per medallion is where we would exit them. So not going to pay that today.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Earlier, I said management teams make intuition or pattern recognition based decisions. We want to move everybody, whether you're a middle market manufacturing company or a taxi driver, to a data-driven decision. That data-driven decision has more persistency to it. It has a higher probability because it's informed. It also, you can push decisions down where they're not top driven, they're operator driven. And the operator is going to use that data to make the decision and where they need to adjust around the edges, then they can use their intuition or their pattern-based decision making to shape it around the edges. But we're starting from a better place.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Don't they know there's a game letting out? The answer is they didn't know there was a game letting out. As I said to you earlier, most of the drivers are not native New Yorkers. We later on opened what we call a taxi clubhouse. I can go into why we opened it, pretty pedestrian reasons, but it's been wildly successful. In there, we have TVs on. Our drivers or soccer fans, football fans. They don't pay a lot of attention to the sports that drive Americans or New Yorkers. So there's just like a cultural divide. They don't know all the time where to go. The best drivers figure it out over time and again develop a system. We took all that data from the TLC and we immediately got tons and tons of insights. As we got invested into the space, we started pulling more data as we built our own operation, more data. All that data goes to data-driven decisions. Because again, as I think about stressed investing broadly, one of the things we talk about is moving companies.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So we paid nothing. The driver always outearned when they followed the data driven decision making. I mean, my favorite was what I called the NASCAR loop. So the data showed that if you picked up at the bottom of Broadway, you were high probability around Columbus Circle. You were going to drop off somewhere north on Broadway. Make the left turn because the data also showed if you picked up at the top of Broadway, you were going to drop off somewhere midtown around the bottom of Broadway. So just run that NASCAR loop, left hand turns only and turns out to be a super profitable circuit. And there's lots of pockets of opportunity around New York. The other thing, by the way, is the fleets did a terrible job of telling their drivers when there was Nicks game. They did a terrible job of telling them when there was a Rangers game. Terrible job of telling when concerts were going to be all at MSG, obviously. And I know you're a Knicks fan. You've come out of.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Guarantee the 200. And by the way, if you earn more than 200, keep it. We ran dozens and dozens of experiments. How many payouts did we make?”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. And so you saw how New Yorkers were making decisions. And like I said earlier, it squared with the economic reality. Uber's going to subsidize my Friday night date. Great. Let's do that. So, how New Yorkers were making decisions, how drivers were making decisions was also super interesting because we could track individual driver behavior. So we could tell successful driver behavior looked schematic. It was symmetrical. They were following almost predetermined patterns. Now, not the same pattern. Each driver had their own system that they had developed, but it was thoughtful and looked thoughtful and looked intentional. Drivers who were underearning looked like a Rorschach test. It was just a scattergram of behavior. And as a consequence, they were under earning what we thought they could and should. By the way, fast forward later when we set up our own operation, we ran a bunch of experiments with drivers where we said, look, you're likely to make, let's say, $200 a day at that point net. We'll guarantee you're $200.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“What popped out really quickly was if you were going to go east-west in Manhattan, you're almost always going to take a taxi. If you were going to take a ride on a Saturday night from the upper west side to Tribeca for dinner, you're probably going to call an Uber. And when we looked at the data, what I love about data analysis and companies and sectors is when you really dig into it.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“ride by ride the entire data set. It was a lot of data. We tried to load it into Excel. Excel was like, you got to be joking me. So we have a couple of data scientists on staff at Marblegate ingested the data into various data systems. And we started to cut it up. And what we found, again, there were some immediate insights, the one I mentioned earlier, where Uber wasn't taking rides. They were taking drivers. That popped out immediately. We also saw some really interesting data in when people were making choices to take Ubers versus taxis. Every New Yorker has an algorithm in their head, time of day, where am I going? What am I wearing? What's the weather?”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“She said, sure, just put in a FOIA request, and we're happy to answer. But what are you looking for? I said, Well, all of it. What do you mean, all of it? I said, everything. Nobody's ever asked us for all. So she gave us terabytes and terabytes of data.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So the TLC, who's a great agency inside of city government. And at the time, the commissioner was Amira Joshi, who later went on to become deputy mayor in New York. The current TLC commissioner is David Doe, who's terrific to work with. But we went to the commissioner and said, can we get some of the data you have on the taxi market and Uber and Lyft and all of these guys?”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“It was obvious what was going on. So there's this really negative relationship in the industry. The industry was as a consequence sort of set up, as combative. Even though all this capital had gone in and it was literally billions of dollars of capital that had gone in, there were 13,587 New York City taxi medallions. And I told you what the average unpaid principal balance was. The math's pretty easy. So you're talking about billions of dollars of capital that had gone in. And by the way, fleet owners on yachts and taking helicopter services out to the Hamptons while the drivers were struggling to make ends meet. It was just the worst unagable.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Right. That was the answer everybody gave. I, as the medallion owner, have absolutely no economic relationship with the rider. The driver pays me. My customer is the driver. Everyone gave me the exact same answer. They gave me the passenger as the answer. I said, but the driver pays you. Oh, well, okay, sure, I guess. But they weren't treating their customer the right way. They were being abusive.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Proved that out to ourselves at least. We convinced ourselves and obviously our investors that what was available here was an unbelievable market that for lots of reasons had been underinvested in terms of operations. So there had been lots of leverage put into the system. I would say that folks who had owned medallions and operated fleets had been extractive. So they hadn't been investing in the business. They hadn't treated the driver the way they should. I used to begin every conversation with somebody in the space the same way. Tell me who your customer is. And you know what the answer was from 100% of them? Who would you say?”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“structure and that they were making a very cash based decision, but they were pushing a lot of those non-cash or non-immediate cash costs onto the driver. They were taking those liabilities on. And ultimately, when you adjusted earnings for all of that, the driver was really underearning what they should. And you also saw a lot of turnover in those days because I think drivers were coming to the conclusion over time that their own individual return on invested capital wasn't sufficient. So we started to understand that. In fact, when I was out talking to one 70-year-old garage owner who I think had grown up as a taxi driver, his father, I think, had bought medallions in the 30s. He said to me, Andrew, the reality is nobody's reinvented the economics of driving a car yet. And until that happens, taxis remain the most durable cash flow in the system. And over time,”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“For one medallion. And by the way, again, if you look back and look at it purely on a cash flow basis and where interest rates were and alternatives, not the craziest thing to have happened. You or I would never have done it, but I can understand why somebody might have made that decision, if not a decision I would make, but not the craziest thing. Now, that being said, the average unpaid principal balance of a taxi medallion loan ended up being about $550,000. So the average taxi driver owed $550,000 on their medallion loan. It was a lot of money. We did a bunch of survey work. We came up with our own understanding of what an Uber driver's net earnings were. And what also became pretty clear to us is that Uber was taking advantage of an information asymmetry. So they understood that a driver didn't really understand the full picture of their cost.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“That are driving the taxi. So it's a small business in and of itself. By the way, pre-Uber coming to town, taxi medallion had been worth over a million dollars. They peaked at $1.2 million.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. Well, you have to stay connected to the market, but we spent two years researching the space, a lot of time in Queens going garage to garage, learning about the market, learning about how it works. Because it's a pretty complicated ecosystem, to be honest. It's emerged over 100 years and employs literally thousands of people in New York City. It also is an important on-ramp to American commerce for the immigrant population. When I did my taxi driver's license, you have to do a pretty complicated and long set of classes. It's no London, but it's still demanding and expensive. But I was the only native born American in the room. Everyone else had come to the United States in search of a better opportunity. So it's an important spot for New York commerce in particular. And by the way, what people don't realize is the bulk of New York City taxi medallions are owned by individuals.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So Uber was having a tremendous amount of success, and they were pulling those drivers away. The interesting thing is when we started doing our research, and by the way, we spent two years researching it before we ever did anything. I mean, my favorite party trick actually is as part of that research, I became a New York City taxi driver. And I still go out and drive.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. It was 2016, and so Uber had come to New York in 2015 in a big way and had made a huge push into the market through 15 and 16. They were subsidizing every ride. There was this perception that they were taking riders away from taxis, and that was not at all the case. The data was super clear. They were expanding point-to-point car service in New York. They were taking drivers away from yellow. And so yellows were stacking, parking themselves, not generating revenue as a driver went to Uber. And the driver was going to Uber because Uber was subsidizing every right. So the driver's earnings power was accelerating. People were making rational choices. By the way, more people were switching into Uber from other modes of transportation, bus, private car service, subway, because Uber was subsidizing New York. New Yorkers are the most sophisticated price-sensitive consumers in the world. They were getting brand new cars because all the drivers were going out and buying new cars. They were getting brand new black cars and subsidized service. New Yorkers, this is a...”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“The first thing you told me, and I remember a visit. Sure, my partner, Paul, came into my office and said, I'm talking to a bank who wants to sell some loans against New York City taxi medallions. And I said, that is the worst idea I've ever heard. And he said, okay, and we went about our way. A few weeks later, he came back to my office. He said, I just spoke to that same bank again. And they want to know if we'd be willing to look at those loans against taxi medallions. Remains the worst idea I've ever heard.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“We needed to bring to bear resources. Now, there are some great firms out there, FTI, Alvarez, Alex partners, that specialize in doing that, again, particularly on behalf of the portfolio investors who are more traders in this space than investors. But A, those firms are large, they have large cost structures, and they're generally more than a middle market firm can bear.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Lenders across the United States, I like to say that we are the number one buyer of steak dinners in Middle America. We also built, of course, an analyst team. We have in-house financial restructuring. So today, a lot of the folks that call themselves distressed investors, again, I view them as buying cheap high yield and participating as pure financial investors and portfolio traders. They will outsource all of that critical thinking. At Marvelgate, we say there is no outsourcing of critical thinking. And so we think about the financial restructuring in-house. We also built an operational restructuring team in-house as well. Again, going back, as Paul and I looked at the market evolve, we saw those covenants widening and the businesses deteriorating. And so we knew that when we were taking control of them or inserting ourselves into their capital structure and their ongoing operation and resolution that”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, when we sat around to build Marblegate, we said, look, we're going to focus on that middle market. At the time, we were convinced that there was going to be good opportunity. We couldn't have imagined that it would persist with as much duration as it has. Now, you also, our focus in accessing that is around the U.S. banking system. The middle market continues to get most of its capital out of the banking system. We hear a lot about private credit, and at Marvelgate, we talk a lot to private credit, think a lot about it, and have a lot of views on it. We think about the broadly syndicated market also. We think about all sort of forms of corporate credit. But the reality is we access most of our investment opportunities out of the banking system. So we built Marblegate with the idea that we would go talk to banks, source our product directly from them. So we built a sourcing team, and our sourcing team goes out and talks to hundreds of”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“bigger. And a lot of that mimicked or mirrored the growth in the LBO market. We oftentimes refer to the LBO business or the private equity business as our manufacturing division because they will produce a certain amount of problems pretty consistently. So as the LBOs got bigger, a lot of the investors who had been built to invest in their problems similarly got bigger. But that left an entire portion of the market just underinvested, under prosecuted, underlooked at, under analyzed. And we saw it as pretty rich pickings.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“So Marble Gates started in 2008, 2009. 2008, my business partner, Paul Arrowway, called me up. He was at Bear Stearns. I was at another distressed investing firm called Epic Asset Management. And he said, look, all great distressed investment firms are born out of crises, and this one's ours. We sat down and talked about how would we go about building an investment firm and how would we go about accessing investment opportunities in the distress market. Now, Paul and I had done a lot of business together over the years, and we liked focusing on the same types of businesses. We saw this middle market area as being wildly underinvested. As we grew up in the business, and I oftentimes refer to Paul and I as the youngest of the old group of distressed investors, what we saw were the oak trees and the Apollos and those folks who had cut their teeth investing in distress, getting bigger and bigger.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Being thoughtful in its analysis and its deal making strategy, and they've probably come to a similar conclusion. I think the Treasury Secretary speaks pretty confidently and directly about this, and I agree with their assessment. For the ticker tape economy, the tariffs are not going to be terrible. In fact, they could be constructive. For the middle market, though, anything above the five or six percent tariff will have a devastating impact on margin and consequently on the ability to service their debt stock. So any persistency to tariffs will crush the U.S. middle market.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“About it, somebody said to me recently, Well, Christmas is canceled. Why is Christmas canceled? Well, you have to put your orders in now. So if you're a business trying to make a decision about what your Christmas book is going to look like, how do you even make that choice today? I think it's a really tough time to be a corporate manager. I think there's lots of challenges in the economy. People are having to make big bets where you don't know which way anything's going to go. Are you going to be able to have your supply chain continue to be in China? Are we going to have a persistent trade problem with them tariffs? Our data looks at, again, across the middle market, and then we look at the public market and we say, what are the likely impacts and how does this work through the balance sheet? And what would you suspect happens? I can make a pretty strong argument that public companies will actually benefit from the tariff regime. And again, I'm going to assume that the West Wing is...”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Unfortunately, today it's everything. The most acute is, of course, the tariff risk. And by the way, we have some data. We have some thoughts about what that might look like for companies. But the indecision of tariffs.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Think about distressed investing, it is provisioning capital into difficult situations that are capital constrained. Now, some people look at distressed investing as when the market pukes out, we're going to step in and buy and watch it ride back up. That happens. Every 10 years, there's a big puke out. That's a tough investment strategy to... Yeah, the reality is that the data is pretty clear in each and every year there is some portion of the economy that is running at a two to three times the average default rate in the system. So that is to say there's Sorts of things.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a great question. Like, distress investing covers a lot of things. The term has been, I would say, abused in recent years. When I got into the business, it meant buying the debt stock of an individual company and then exercising the rights and remedies under the credit agreement to drive an outcome that generally involves some amount of operational improvement. Back when I got into the business, credit agreements were tighter. And so companies got themselves into tougher spots in a narrower range. The covenants were such that if your performance started to decline, bat it back into the middle of the fairway or deal with the problem. Today, covenants are much wider. And as a consequence, when you violate a covenant or get to a place where you need to restructure one way or another, the business is just worse off generally and needs a much bigger operational reworking.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“Weakness in this economy, we can spur growth, get everybody buying. There are some macro things you could do. You could pump more liquidity into the economy. Of course, you risk an inflationary spiral, which we're probably on the cusp of again. You can do some sort of wholesale debt restructuring and try to get through it quickly. That would be recasting a resolution trust company type idea. I don't know that there's even the beginning of the political will or discussion to do that at the moment. I go to the meander solution is where this probably goes, where we just slowly work through this over time. And we solve problems one by one.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“In the 2023 data, we saw that almost 25% of the companies in the data set couldn't make their debt service coverage. So surprise, surprise, in 2024, business bankruptcies hit like a 14-year high. Fast forward, the 24 data that we're living with now in 25 showed that another 20% of the data set couldn't make their debt service coverage. So based on the data we see to date and the bankruptcies that we've already seen in 2025, we would expect 2025 to show persistent and possibly higher number of business bankruptcy filings. We're also interestingly starting to see some larger companies suffer that as well. So goes back to as much as the infomercial that is CNBC wants to convince you that everything's great in the economy, it's just clearly not. How do we resolve it? I think there is broad-based.”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source
“A few different ways this can resolve itself, but it probably will resolve itself with a bang in some way. Now, that bang can be a long, drawn out, something that looks like, say, the early 2000s, where we had just years of persistent restructuring across large portions of the economy. It could also look like the late 80s, early 90s, where we had a real credit contraction as people dealt with over leverage from the direct lending crisis. Some people call it the S&L crisis of the late 80s, early 90s. That feels like the world we're heading into. There are other scenarios you could imagine that are more punctuated. Let me go back to what I said earlier about debt servers coverage. So interest coverage is a funny problem because, again, you've got to make that coupon payment. If you're unable to make the coupon, you have a couple of options. You can go to your lender and try and work something out or your ultimate resources. You can go petition the courts for...”
2025-08-05 · Invest Like the Best · Andrew Milgram - Full-Contact Capitalism - [Invest Like the Best, EP.436] · IDENTIFIED FROM THE TRANSCRIPT · source