YouSaid · the spoken record

Henry Ellenbogen

lines on the record: 123
first: 2025-12-16
most recent: 2025-12-16
sittings or episodes: 1
sources: podcast

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“Actually, get too stuck in your ways. You surround yourself with smarter, better people, both internally and externally. But one of them is you better processes. And one of the processes that we only started two years ago was we always did quarterly KPIs or operating reviews, but we didn't go back and look at an investment that we own for three years and just say, and when we do them, they're so simple. We say three years ago, we thought they would do X and now they did Y. Now, of course, the conversation is, where was it different and why? But actually, the preparation for that meeting is, at least on the written side, so simple. It's two slides. But then, of course, we're all human. And even though we try to hold each other accountable, if you get together every quarter and something deviates a little bit.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Is modeling but clearly spelling out what we're tracking, we have to then be able to, when we do our quarterly, what are really our operating reviews at durable, where we go through the entire portfolio with the entire investment team on every single investment, we have to look how actually the companies are doing against what we thought they would do. And then every single investment at durable, if we own for three years, we actually do a three-year lookback on what we underwrote and what it did. And that one, like so many things in your career you wish you would have known earlier. The great thing about investing and the great investors to me actually are better at 70 than they are at 50. And hopefully I'm in my 50s. I'm better than I was when I did this at 30. And you just learn. You understand patterns better. Hopefully you remain humble so you don't.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Are really inflecting, and maybe we see in other people who don't do so we can go buy more of it. So we got to be able to do both. When we write an investment memo, it's in service of our investment philosophy, making sure we've done the work and we can clearly articulate why is a company competitively advantaged or will it be? What would it have to do? Why is this operating culture excellent or why does it have the seeds of an excellent operating culture? And why does this leader think like an owner where they can basically make the business better, which we define as gaining market share through cycle? And we think that they can allocate internal and external capital such to both drive more durable growth and also make their asset base more valuable over time. That's our investment memo. But then just as importantly through both.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“We're writing culture because at the end of the day, human beings are innately human. When we are involved in something, it's very hard to have that executive distance that you need to do to really hold yourself accountable to what you thought and actually hold the companies accountable to what you would like them to do. Especially since we really do know the people we invest in and we invest in really high quality, interesting people and we're deeply rooting for everyone to succeed. Unlike a venture capital firm or private investing firm, we have to be able to understand when things aren't working out so we can sell them. But just as importantly, if we're going to go invest in something that has real risk, like Duolingo, we have to understand when things like Duingo.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Where it actually aligns incentives and consonant with them, it's just super impressive. The other thing is if we're going to invest in small companies, those companies, by the time they form them tend to be pretty large, we have to be pretty sharp at really understanding other competitive advantages.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Jay Hennick's chairman of and what Collier's had where he's CEO of, he's the largest shareholder both. None of them actually have these super sharp competitive advantage. But yet if you really have studied Jay and you truly understand his human capital culture and how he basically attracts and holds people accountable and his ability to basically decentralize incentives so people are aligned in businesses everything from residential management of condos to roofing and restoration and then how they allocate capital how they sell things that don't have a path to be great and how they buy businesses, but they do it in a way.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Hard. I think about the example of Dan or her so much because what Mitch and Steve have done is stunningly hard to imagine that for nearly 40 years you've compounded wealth At 20% in something that didn't have deep physical modes or didn't have data network effects. Like Metamite or Google have or the people who believe deeply in open AI, those data network effects are amazing. But the ones where you're really sharp on human capital, you're really sharp on what talent really means, not the sticker of talent. You're really sharp on your operating excellence, the culture of it, the constant improvement of it, the system behind it, like Kazan. And then you allocate capital against your businesses to really hold them accountable. Think it's amazing. In our portfolio, even though if I were to walk you through the businesses, that first service is in which”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Can't spin those things up, these things that are super messy. You got to acquire the land. You got to put on the right place. You got to build the right network. Then you got to go stand it up with the right CapEx and the right systems. And then you have to have the right operating culture. This is really, really hard. If you put your real estate in the wrong place, then your cost of transports more expensive. This culture, you got to go build there super hard. So I deeply love these physical world moats that exist. And really, our portfolio has a lot of them in one way or the other. And that's why when you and I talked about robotics, my mind went to distribution. It's like, where can robotics basically take already advantaged businesses and make them more advantaged? The other thing I really believe is these soft things that are incredibly”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“I really love two, and they're actually quite different. I love physical real estate. I love Amazon or we're investors in Carvana. I love their reconditioning, etc. Because at the end of the day,”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Even if they put the same amount of money into this problem, even if they could hire the same quality of people, which is unlikely because they have not invested in the distribution infrastructure or the technological infrastructure to compete on this curve at minimum is probably two to three years behind and every day that they wait, they're probably getting further behind. It's apparent to everyone a durable why our understanding of change has been great for our investments in Duolingo and a firm and Shopify. But actually, I think it's about to be really advantaged. Our understanding of people and change as we go invest in the other 70% of the economy.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Faster? Well, then we wake up in five years, and the people who put themselves on one cost curve, if they compete against the people who put themselves on the other cost curve, those could be power law businesses. What we have thought really hard about is who's going to go benefit from this curve where there are competition, even if they woke up tomorrow.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“And deal with suppliers actually were probably at a curve that probably inflated at 3% to 5%, but at best were flat. And that differential in a low margin business, you compounded over five years. Honestly, that's all you need to know. And that's, I think, what we're starting to get our heads around at durable, which is if in many areas robotics is at parity. Now, there's a lot of data that says it's lower cost in certain cases. And the use cases are about to go up. And the cost on the existing use cases probably don't go down at 3% to 5% at this point in the curve because of the scale brought in, the human capital brought in, the IP bought on, and the fact that you're going to be able to use these general purpose LLMs. to power it probably goes down at more like 15 to 20 percent but maybe it's more law and it goes down even”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Of the label process. And yet, as we all know, this is the earliest and worst robotics going to be. And because machines are iterating with machines and it's being powered by general purpose models, not by specific purpose models, this is riding a curve that is definitely geometric. And so back to this mental model of Amazon that drives so much of what we think about durability. What Amazon was able to do is ride a cost curve where they were deflating the cost of sending a box out at three to five percent a year for 20 straight years. And the people who did not leverage the right distribution infrastructure, the right investment in robotics at that time, they bought Kiva, the right ML models when they came into play about how to basically plan inventory.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Something we have really thought hard about. Here's what we have tried to do. First of all, we have tried to get smart by meeting with the entrepreneurs and talking to the companies that we're involved in that we know that are leading this area just to try to learn. We only recently did this with robotics. So if we started writing down our conclusions and then being humble that it could change every six months in AI in what you would say is more data businesses or digital businesses, we only started doing this literally in the last month where we documented it for the first time. I'm going to do something that I don't love to do, which I know our views here are very early and probably deeply wrong, but I'll give you our initial conclusions, which is in certain use cases, it's pretty clear that already the cost is lower.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“But this company was purpose built for AI. You actually have a person who studied AI and taught it at a Carnegie Mellon and has an organization of A players who are agile in his company and is humble and constantly learning a proof point on how it's making him faster than other people. It's driving real value. And obviously that means the probability of it going from a point solution or a couple products to a suite is higher. And so that's what we look for.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Which is doing incredibly well. And my kids really love that product. I mean, they're addicted to it. First, it was two people for six months, and then he added another four people, and he developed a product in nine months. That's the best product he's ever done. And if you ever talk to him, how long would it have taken the past? He's like, I don't know. I probably need four to six X as many people, and it would have taken them four times as long. And so you could say a startup could.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“us to spend our time reading and thinking and talking to smart people so even if these are really talented people most likely they don't have as much time to go do it as we do and we have to be very humble in our approach so they have to have a perspective figure out how to go do this not be paralyzed but they also have to be humble and constantly learning and the last thing I think practically we have to think about as investors is backs to the memo If you have a high risk situation which we would all agree Dolingo is and firm is and you're really close to that part of the change, then you need to be compensated for the risk. And so what we would tell people on Duolingo is, yeah, like because of this risk, the discount rate has gone up, but probably commensurate, the opportunity has also gone up. We can articulate it. Louise has talked about being 20x faster in generating content. We've already seen it. He's publicly said he developed chess.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Stress resiliency at durable. It's one of the reasons we like so much investing in active managers. We can go study their resiliency. When you're an investor in Macs and you saw how resilient he was in Slide and now you understand how he's got to be resilient to implement AI to lean out his cost and drive his revenue before his competition does, you're like, we've seen him under stress before. I think you're looking for people who have a perspective can execute but also are humble because we at Durable write down our views on AI every six months and we update them. And as we've gone more into this period of change, probably we're less wrong. Our perspective is more informed, you would say, than it was as we change it every six months. But we're learning. We have the benefit of having a job that allows”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“There's a risk here. So that's probably in our portfolio one of the higher risk names. But what do we look for when Luis or Max or Dave Duffields? I think the first thing we look about is a business that already is operating well because if you're not operating well when you have to deal with change, you're not going to be able to do two things at once. You can't do a turnaround and do well. I think the second thing we would say is a business that already was winning in its first end market. All the definitions we would have about winning substantially gaining market share, driving real economic profit that allows it to reinvest in this next S-curve and also the other thing we really care about is people. We really”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Go pick on Luis. We talked about Luis earlier. Duolingo has a lot of opportunity with AI and a lot of risk. And the stock, depending on the day, reflects it when open AI demos how you can use open AI to basically do translation. A lot of times the stock goes down. Or when Apple shows you how AirPods can be used to in the physical down. Actually, I don't think the mark is wrong. Now it's probably wrong the magnitude, but I think what the market is saying is”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Was led by high quality people who thought like owners, but because discontinuous change changed the world, they weren't able to adapt. Now, ideally what we go do is we go find those already advantaged companies and then they leverage this to go from good to great.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“So we're trying to do two things. We're trying to find the people who that might be, and then we're trying to make sure we don't get killedly own a company that based on last generation competitive risk was a great company. And correctly, we thought was competitively advantaged and had a good operating culture”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“And as we all have come to understand with Amazon, they took that three to five percent cost advantage of getting that box to you and their ability to put more than one item in the box. And they use that economic advantage to then go build fulfillment centers that are physical to reinvest into capital and infrastructure that allow them to go down that 3% to 5% cost curve for 20 years. As I said earlier in the show, they woke up and the only people who could play their game when eventually everyone realized what they were doing were the people who still had the scale and the customer relationships and the trust of Walmart and a Costco. And then eventually when they figured out all three of them were great. Now the problem is the rest of retail is not so good. That's what we think about here.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Businesses that leverage technology, leverage it in a way where they use it to lower costs and drive revenue that result in them gaining 30% or more incremental market share in their end market. And then they take that unity economic advantage and they reinvest it in something that is persistent, even if their competition were to wake up tomorrow and do the exact same thing with people just as good as they are. And to me, that's one of the definitions that durable of a competitive advantage is if your competitor does a competitive mode attack doing the exact same thing with people as well.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Product based businesses working capital. But in many ways, I feel like we're just getting started on processes that are done by humans. The second example that I'll talk about, and I'm talking about things that haven't been talked about as much on this show, when I first really understood what was going on on the internet, I ran a global TMT fund. And my largest investment was Amazon. We invested in that one. It was a $10 billion company. So I used to go to Seattle twice a year. So interestingly, the things you remember because it was far from Baltimore. No one would come with me. And it was a small company. And people thought I understood it. And I used to go, I've lunch twice a year with Jeff Pizos at the time. I work for the firm that was his largest outside shareholder. And it was obviously my research position for the firm. I learned so many things from those meetings. But one of the things I learned is the very best.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“By going into factories, putting processes up in whiteboards, studying how they could lean them out, leaning them out and coming back in a month later to make sure, because change is hard, that the change is held. And then they basically built a whole business system, which has basically not only helped build Danner, but there's over a dozen Fortune 500 CEOs in the United States who started their jobs at Danaher, including the guy who just have turned around GE. So since you're so excited about this, let's actually go to the Godfather in the United States. The reason I say that is this is just so profound. It's even hard to get your head around. Mitch would say for 40 years, because at China, we've been able to really lean out.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“With that. So, I talked to him one day after he reports earnings, and he explains to me you're always asking me about how I'm using AI to become more efficient. I feel like I was late to the curb, but I finally figured it out. And so he says, I have this team that goes around the company and understands processes. And we start from not a cost standpoint, but we start from a leaning out standpoint. And I think I'm making real progress there. And that's why I'm able to make this public pronouncement. He's like, this isn't this great. And I say to Max, why don't you come to DC and let's go see Mitch Rails? Because Danaher, who he and his brother started, and he's chairman of, has been doing this for 40 years. It's called DBS. And they basically brought Kaizan back to the US, and they've started. They're obviously more of a healthcare company now.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“As the fintech company that empowers people to get access to credit in a safe way and actually pretty compliant friendly way with no tricks. And he's doing even more than that now. But at the end of the day, because he is regulated, he has a lot of legal cost in the company. He's got hundreds of thousands of contracts with merchants. He's got to monitor his partners on how they communicate credit. And that just requires a lot of people. If you talk to him, and he's talked publicly about this, he's got great belief that a firm can grow at the rates that it's growing at for a reasonable period of time. In addition, they can do it without adding headcount. And the reason for that, obviously, he's going to go lean out a lot of processes that were not possible to go do before AI. I'll tell you a really funny story.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“You had to understand it. And if you didn't leverage it yourself, you were going to go out business. That was the first derivative. The second derivative is actually there's a lot of businesses that are spread businesses. You look at a lot of distribution businesses as an example. If you distribute, talk about a great business like HVAC, the industry tends to put a spread on the raw material. If your HVAC unit basically inflates at 3% to 5%, that's good. And if your HVAC deflates at 3% to 5%, that's bad. And so if you were a spread business on top of it, that was problematic. Every company that was product-based or derivative product-based had to understand China cost. And I think the same thing applies to AI. But I think it's not product-based system. It's IP-based. So let's go back to Max as an example. Affirm most people would think about and correctly so.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Which you see in the markets, but it's also going to impact, in this case, I think almost every company that needs white-collar employee and IP employee to drive their work. So let me start with the second one first, because I think less people have talked about that one. As a student of business, I think that by the end of the 2010s, everyone knew that if you were a product-based business, you needed to understand your China cost. It was on the cover of every business magazine and then every popular magazine in the 10s. And all that meant was in a global supply chain, if there was a part of the world with huge scale and resources like China and the Far East that could make product substantially cheaper when you landed it at your factory or to the consumer.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“So I started writing about AI and our shareholder letters in 22. And at the time, I said having seen internet, cloud, and mobile, this is going to be at least as powerful as internet. And I said, we're going to go approach this with humility, go spend time with the people who are closest to it, and constantly be learning. And I also said, durable is not a thematic investing for more compounding investing firm. So just because we think something's going to be big doesn't mean our investment meetings aren't going to be AI is going to be big. Let's go buy AI companies. It's going to be, let's really understand change and then understand how the companies that we invest in are going to benefit from it or become better by it or at least not get disrupted. I personally, and I'll lay out in a second, think it probably is more impactful than the internet was. It's not only going to affect every technology.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Of an early stage growth company that we dollar cost average down. I think we're advantaged in because if you're rule-based in what you do or you have a one or three month timeframe, you just can't own Dolingo. You can't own more colliers.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Many of these companies actually were going to have a tough time getting to profitability and as interest rates went up in 22, I think correctly, a lot of people said actually just throw them all out. The average loss making company in 2022 in the Russell 2000 growth went down over 70%. Our view was makes sense. The market's probably right, but not all of these can't adapt. Not all of these don't have businesses that are good enough to make real economic returns. Our view is not all of these companies didn't have the discipline and the organizational fortitude to transition and become successful companies in a world that actually required profitability based on the change of interest rates. DuLingo is an example of a company that we actually bought more of in 22. And there was an example.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“If Collier's is down because people are worried about commercial brokerage, because of interest rates, actually the markets are probably right. They're probably right 90% of the time. But if we understand what's unique about that culture, how they allocate capital, we understand deeply how the quality of that Harrison Street is because we've studied it for 20 years and we know the people who run it. Well, that's a reason why we're willing to lean into that stress. The same thing when I look at our early stage growth portfolio, I spoke about Duolingo earlier. They came public the last time the capital markets were really open to companies, which was 2021. There's been a lot written about the 2021 IPO class.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“And yet, this was the most volatile earnings season. I think the reason for that is just basically the fact that we estimate somewhere between 80 and 90% of the institutional flow is driven either by the firms that have one month and three month agency or the quants that have to take these price signals into account. And then their models are optimized for this. And so what we have said at durable is really simple. Let's go do less so we can do more. Because if we're going to accept volatility in stocks, we have to really understand the business and the people like we do at collier's such that”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“And then if you have a bad period of time measured by a month, but certainly three months, you get your capital cut back. There's a good chance you get let go. It probably means you can't have a time horizon longer than your career horizon. What we also have noticed, because we not only understand things anecdotally, we also study them, if you look at the last public market earnings season, which was companies reporting Q2 this past year. If you study earnings volatility, it was more volatile than any earnings season since the financial crisis, even though during the financial crisis, as we all know, the fundamental banking system of the U.S. was under question, which meant the economy and the markets as we know it really had a wide dispersion of opportunity. And the markets tend to be a lot more volatile when they're making lows and making highs.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Impacts both our early stage grow companies and our durable growth companies. And where we're investing, where we're not advantaged versus these machines probably should have done it anyway, but we're going to stop doing it. But we did it, of course, all within our investment philosophy. And that's basically what we've done at Durable as we've gone and studied millennial and citadels. First, let me be very clear, deeply respect those organizations. I think they're great at what they do. And I actually believe that people who work there are very talented. And we start from the view that these are exceptionally talented people who are actually very good at what they do and are high quality people. But what we have said is what do they do? And what is the limitation? And one of the limitations is if you work at a firm that deeply measures your risk every day.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Not going to work. The machines are just going to be better at that. But if you're like what we were at the time, people who are really good at understanding people and really good at understanding change, that was really advantaged. And I basically, at my old firm, I did an internal teaching on man versus machine. And I said, as a result, what the new Horizon fund is going to go do is we're going to go double down on these two things. And we're going to get better at them. We're going to get more focus on what we do on the people side of our business, both in the public and private market. And we're going to get more focused on where change.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Short term alpha game is probably going to be one by the machines paired with a human. At the time, it was when for the first time computers paired with machines could beat the best human chess player. And this is obviously when I went and spent time with the principal at Tusigma, I learned he was doing exceptionally well. But anyway, I got to know him and we talked a lot and I realized actually there were real limitations to what the Kwants could do. I started realizing if it's a repeat actor problem based on known data, actually the quantity good. So what does that mean at the time? Well, it means if you're just a person who buys an industrial company because the PMI is down and historically when the PMI rerates and gets better or you make money”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Started thinking a lot about it two years ago, and in hindsight, I probably should have started thinking a lot about it three years ago. You don't get everything right. There was a period in my career where the Kwan funds really started to do great, the two sigmas of the world. One of the things we really stress at durable is humility. So we never look at a problem and assume we're right and the other person's wrong. And we never assume we're good and the other person's bad. We actually look at things and assume the other person's really smart and what we can go learn from them. And so this relates back before I found it durable. But I went and I studied the quants. And what I concluded was”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“That's cyclical. It's actually a really good real estate asset manager emerging really strong consulting firm. So last year, when people were worried about the weak commercial real estate market and interest rates, we bought a lot more of that company. It sold off based on short-term macro concerns. So in that part of the portfolio, probably we're buying more of the companies when they go down.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“I think for sure the brand suggests it's a commercial real estate broker. Commercial real estate brokers don't do well in general when interest rates are high. That was the case last year. But I think what's misunderstood about Jay, and he's done this time and time again, is because of his understanding of he was really a disciple. And his mentor was Peter Drucker, his understanding of local incentives, and his sharpness of capital allocation. And the way he sets up the partnership model when he buys people, what people haven't realized is he's built an incredible business both in asset management on the real estate side in Harrison Street and also he's building a terrific consulting platform. I think our insight there is Starshwood J, but it starts with understanding actually the asset quality of colliers is not the quality of a commercial real estate for”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Essentially, CEO of Colliers, but he was also the founder of First Service. And we own both of them. We're actually involved in a private investment with him also. Back to Act II entrepreneurs and also our belief that we do business with people and we're really good at people and good people do sometimes multiple things well. And look, in the case of colliers,”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“That scenario, we would want to buy more. And if not, we just can't get involved. Now, of course, in my career, I've invested in over 100 private companies. And I think I've been involved in over 50 IPOs. How many of them do we still own? Well, we probably still own more than anyone else in the markets. Even if I look at durable, among our largest positions in the public markets are DoorDash, a firm toast, now Figma Warby Parker. And we led those last private rounds. They persisted and we bought more at different points on the curve. I would say on a durable growth company because of market volatility and this agency principle that I think about that's forcing people to have short cycle view of the public markets. Actually, probably you're buying more of them when they're down. One of our favorite entrepreneurs is a guy named Jay Henneck, who”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“If it does what we think it can, not like it will. And I'm going to speak to that in a second, we would then want to buy more as it in our lexicon gets bigger, but also de-risks and then proves to be a competitively advantaged business and shows more resilience and shows the ability to financially balance growth, profitability, innovation, basically prove its ability in the case of Dolingo to become more of a power app teaching speakers a foreign language for more self-improvement that it starts to do it for learning that basically increases educational ability to participate in the economic world. They're obviously going to different subjects with chess. So as you progress as a business more towards what we view as competitively advantaged business, that's, for lack of better word, baked but still has growth, we underwrite those with a view that if it does”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes and no. So there's really two parts of our portfolio. When we're looking at what we call early stage growth companies, and it could be Duolingo as a private company, or it could be Duolingo after it goes public, but it's still not competitively advantaged. And at that point in time, it didn't have cash flow. It didn't have PE ratios. We still, in our view that it's an early stage growth company, where we're saying in the future could be competitively advantage, the operating culture could be clearly established where we could look back and see the excellence of it and the adaptability of it. And then we could look at the growth formula and really understand it. And obviously, along the way we've really believed these are our kind of people who could scale organizations. So when we look at something like that, we have to believe that when we look at the three plus three or underwriting it on a three-year basis in general, not always.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Market has changed where capital is short cycle. So many people are in one month basically incentive models, not even yearly one month. And so we have to have been very transparent with our investors and told them what we're trying to do, deliver on those promises, but deliver on those promises over the right period of time.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Already competitively advantaged. We write the memo that says his DuLingo does what we think it can do over the next three years. Not only do we make a fair return for the risk of the company, but at that point in time, we would want to buy more at these higher prices. And if we can't write the memo that we want to buy more at higher prices, we can't buy the shares and our thesis can't be it gets bought. Or our thesis can't be it'd be a great talent acquisition by someone. So that has to be aligned. And then the investors were in business, but we have incredible investors. We have to be transparent with them that in order to pursue this philosophy, we're going to have what people would say is monthly or quarterly volatility in our performance when they look at our performance. And that sounds so obvious, but increasingly the”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Two companies, a public company, and can continue to work on that. And investment firms aren't structured that way. So if you want to have people who can do that, you got to develop them internally. Second of all, it's time allocation. In general, at any point in time, we probably have 10, 15% of our capital in the private markets and the rest of the public markets, but we have to be willing to spend the appropriate time on new ideas. So when we look at Duolingo and the right decision for Duolingo and maybe the right decision for us is only to invest $20 million, we don't look at it as a $20 million investment on a $15 billion vehicle. We don't look at it as 10 basis points or 12 basis points. We actually look at it as our future compounder, our investment memos are just fundamentally written different than other investment firms. When we look at an early stage growth company that is not”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source
“Is organizationally, how are we going to go align against this? The way we think about people is very purposeful. We really believe that very few people actually operate the way we do. We think durable is just different. It's different because my partner, Catherine, who worked with me when we first underwrote Figma in 2020 and also when we led the investment round in 21 was the same person who was at the all hands meeting with Figma when Dylan announced to the company that they were going public and it's still the person that basically looks at the company when they announce their public earnings. I mean, that's just different. You have to have people who can work with companies that are valued at $2 billion and they're private and have 30 million of run rate revenue and now Figma's a billion.”
2025-12-16 · Invest Like the Best · Henry Ellenbogen - Man Versus Machine - [Invest Like the Best, EP.452] · IDENTIFIED FROM THE TRANSCRIPT · source