YouSaid · the spoken record

Jim Zimmerman

lines on the record: 43
first: 2025-05-23
most recent: 2025-05-23
sittings or episodes: 1
sources: podcast

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“Thank you very much. Really fantastic. We really enjoyed it. We enjoy your show and watch your legislature. So appreciate you having us on. Very nice.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, we've been very careful with retail going forward and just really, okay, what's special about this? And it's just such a competitive area. And so there's definitely a learning there. And we're very careful about looking at it. We have had some big successes there. Industrial companies, we like those, but it just goes to what's the sustainability and resilience of the business. And in both those cases, it wasn't nearly as strong as we thought. Now we got out of both of them pretty quickly. We were just, you know, this isn't working. And so we exited with most of our capital back. But you just know in past a thousand in this business and you have to really constantly redo your work on the investment and the mode and your thesis. Does it still make sense, et cetera? So those are kind of the learnings there for us.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“It or what's special about what were our insights? And if we can get two out of three right and hang on to them, we had some really big winners and then most of our capital back on the mistakes. And if the cash from op starts going the wrong way, we're going to exit stage left probably. We're not going to stick around on the company always has an explanation and we're like, well, you're probably right, but we're going to exit stage left and see how things play out from afar. We've had sort of better luck doing that than staying in things. And, you know, a lot of investors, if the stock's going against them, they'll add to their position. And we kind of do the opposite. We just sort of hang on to what we've got and we're always questioning if we made a mistake and there's a lot of self-doubt and concern. And that's just sort of our approach because investing in equities is an extremely difficult, volatile task.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think Abby's, I agree with Abby. You know, two out of three, they had a pretty good batting average. That's probably something close to that. Sometimes it takes a while to work, you know, where the company's Celestica, you know, where they're executing and doing really well and the market doesn't really care. And did you miss something? What did they know that we don't know that market's pretty smart? What did we miss? That's what we're asking ourselves. And fortunately on that one, we hung on and the market finally recognized it. But people tend to be very confident about that they're right and you just, it's very arrogant to pick stocks, as Clarmin has said, you know, that you know more than what all this thing is out there. So you really have to find a mispriced situation where you really feel like, and we try to do them just one at a time, almost as if, you know, which we are, we have small family office. We're deploying our capital. Is it worth, what did we understand about this situation that people are missing or why aren't they paying attention?”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Net debt, net cash, blah, blah, blah. And it's just another way to try to de risk the investment relative to other alternatives. So that's what the thesis is. And I would say we're always, as Abby said, we're looking at the downside. What can go wrong? Because there's so many things that happen and you want to just make sure you have a good risk reward in the investment. So we'd like to load the reward in fairly close to us as opposed to something that's going to happen in 10 years of this or, you know, predicting really anything. Again, it goes back to the intelligent investor, Ben Graham, you know, not wanting to rely on projections at all. That's the upside. If that works out great, you can do really well. It doesn't mean it won't happen. And well, you know, if the company does well, we'll redo our work and we can hold on stuff for probably a long time sometimes because of that, but really try to not have to go out too far for the investment to work.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“I think Bob Rubin, the former head of Goldman Sachs and Treasury Secretary, really smart guy, said he had a line in one of his books. I don't even know if the sun's going to come up tomorrow. So it's really hard to predict the future. And a lot of these people we write us we read, you know, they'll predict things that are going to happen four or five or ten years out in the future. It's just they're too confident for us. You know, we just don't. We want to keep what's happening very close to us the next year or two. By a year or two, if your investment thesis hasn't played out, there's probably some kind of problem. That's plenty of time generally to, you know, and we tend to be not that patient. So we're trying to load the whole investment into what's currently going on and what's going to happen over the near term, a very simple model out of a couple of years of a cash from ops EBITDA CapEx.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Or inside or outside, or how can we design lights that you can put in very quickly and last a very long period of time? How do we manage the displays for RBs or when you drive through? So they're trying to, in little subtle, super little subtle things, but they're sort of a partner for the customers, which tends to create a recurring relationship. And so it's down to stuff like that. You got to be doing something coming up with new products, a lot of R&D, something, you know, that really ties you to the customer so the customer feels like they're not as concerned about the pricing maybe. It's more of the value add you're doing for them. So yeah, I would say with the capitalite, the moch, as Abby said, becomes really important that it's got to be sustainable. And if you get that wrong, you know, you're going to have a bad outcome. So we'll look closely at that. And we just really don't do a lot of ask.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think when you got the capitalite business, the value is dependent on the franchise and that cash generation. So as Abby's saying, the moat becomes really important. But our economy is not really an asset intensive economy anymore, right? It's all goods and services. And so people have really moved to that. So you're really sort of assessing the franchise they have, as she said, the good or service they have. What are they doing that's unique? Are they doing something that other people can't do, whatever it may be, and how are they outperforming other competitors with this LSI lighting company, you know, they probably come up with 20 or 30 new products a year for the customer and they try to solve be a solution provider for the customer of not just a one product, but what is the lighting issue inside a convenience store, inside a grocery store?”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“You're loading a lot of the risk up front, and we feel that de risks the investing process a little bit. And so that's kind of, you can have companies that can't really grow. And even though their equities, they really are a bond and they never really go anywhere. And we definitely invested in some radio stations. And there was no growth. Great cash flow, but no growth. We didn't really make a lot of money on it. But we also invested in the Celesticas, the Sprouts, the stirlings, the Hammonds, where cash is coming in and they were able to deploy it to create significant growth. And those went up a lot. So that's sort of, yeah, we do say we have a bond-like approach to investment. People say, well, that doesn't sound very exciting. Well, if the bond can grow really fast and it can get very exciting, it's not going to go up quite a lot. So it's sort of a downside way to look at stocks.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“And you can really sort of take that approach with any asset and figure out, you know, okay, well, here's how much I'm paying. How much is it going to grow? And maybe it'll really grow a lot and it's got a great business model. But we find doing that tends to make the investment less risky because we're requiring current, a lot of current cash flow as a bond. The return is being loaded more currently.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Very consistently, the enterprise value of the business just for the balance sheet with the cash coming in, you look at Wynne Buffett bought Apple and the multiple. I don't know what it was, but it was very low. It was very low. And so he has a business that is essential to people. And people were worried about all kinds of things, you know, and the next cycle of the upgrade. But this thing was gushing cash. It was at a very low multiple and it's essential and very sustainable and it could grow. And when you go back in Ben Graham's day and even earlier, a good company would always be one that was paying a dividend. Why? Well, because it had the cash to pay the dividend. So that was how people judged companies way back when in the 20s and 30s. And so this is all the same thing. You know, it's all just converting, what are you paying for the asset and how much cash is it generating? What are you getting for what you're paying?”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“I mean, part of what investing is, as Buffett says, it's putting out money today, get more money later, right? It's every asset's a bond, whether you're buying real estate, whether you're buying equities, whether you're buying junk bonds. You can always strip out the debt, look at the enterprise value, and see how much cash you're getting in. You can make them all somewhat comparable. And that's kind of in the back of our minds something that we're doing to convert the equity. Because at the end of the day, we're just trying to capture as much sustainable cash flow in our little fund for ourselves as we can. And everybody's trying to do that. There's a certain amount of cash flow on the earth, and you're always trying to buy some that can grow at a low multiple. And so thinking of equities as bonds is really normal. And when you look at Berkshire and the companies they buy and they invest in,”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Much higher than ours, and they don't mind it. We like to even try to sort of manage that. But as Abby says, we always want to be around to ring the bell for the next round. Buffett says, to finish first, you have to first finish. And look at all the cash he's holding now. He finds stuff. And so that's kind of our feeling. There's so many, you got four or five thousand publicly traded companies just in North America. We're going to find something no one's paying attention to. We like stuff that a lot of people aren't looking at. We'll do our work and put some capital to make that there. And that's worked for us pretty well over time through these periods of uncertainty and doesn't mean it'll always work, but it's been pretty effective so far.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“And so as we went into this tariff thing and we had a lot of very high multiple stocks that are run up a lot, we took chips off the table and we may go back into them. So we have just felt we can always find and do work on another idea that's really attractive as things get beaten down. And that certainly happened with the financial crisis. We just took our time in. The bottom tick was March 2009 and we just found a couple of things that looked really crazy cheap. deployed our cash into them and we had a fantastic year but we took our time and so we're really not good at trading or managing it's just a matter of if we get nervous about the macro picture we can step back a little bit and pair things down keep our favorite positions but go back into them as our comfort level goes up other people have their appetite for volatility as”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, you look at who holds cashman, Howard Marks, Warren Ruffett, Steve Romick. So the point is some investors like, well, I want you to always be fully invested in. We've generally done pretty well taking our time redeploying cache as we're doing now with the tariffs thing and what are the rules now? Do we understand what's really going to happen here? And we generally can always find something interesting and we'll just do our work one at a time and redeploy the cash. During the financial crisis, we went up to 50% cash at the end of 2008 and we gradually deployed that through 09. And so many funds blew up or they had redemptions or they were poorly positioned. So you always want to be the last man standing if you can. You can't be all cash, but just in our experience, you know, and I hate to say this because you look to regret it, but usually having that cash, we can deploy it and a good returns. And it doesn't hurt us that much to dial up the cash during periods of uncertainty and it helps us sleep at night. And we get worried too. We're normal.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Thorough when he described how he bought companies and what he would do to make them profitable and how he could execute it and just no air about him whatsoever in the most down-to-earth guy. And we held on to that one for a while, still have a little bit, but there's a person and a team there that the value was him and his team and he could keep doing this rinse repeat on adjacent industries. And we the leverage got a little high, but he could handle it. But we got a little comfort with that. But just stuff like that. You just need a couple of those and you can do quite well. So it's a strategy of do a lot of work on it, trying to make sure you're not making a mistake. And then some of those are going to work out really big and try to hang on to them as long as you can, redo your homework as it goes up. And so, but yeah, the growth is obviously key. And Compounders is an overused word, but we are like everyone else looking for those. So hopefully that's.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Come to realize that, so to use saying, you know, heads we win, tails we don't lose much. But sometimes you win really big. And if it doesn't work, you get most of your capital back. And so that's kind of the formula. But really finding that good growth business is where you're going to make your really big money because you just need a handful of those and you can do very, very well. And even though we pare down as they go way up, we still have earned really good returns on some of these. Terabness is another one. We talk to that company quite a long time ago, Dustin, fantastic. And he was telling us what he was going to do. And he was just so.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Or anything like they're just so they're in defense and a lot of, and that company was trading, we had very little multiple of EBITDA and cash flow. They had a net cash balance sheet. And it's worked out really well. And it just seemed to us like, geez, he's got a lot of running room. So we'll deploy there. Is that one going to work? We had Sterling construction that became Sterling Infrastructure. The guy there totally executed, generating lots of cash. We don't know how well they're going to work, but we know some of them will probably work big. And as Abby said, you make your real money on the compounders and the ones that really grow. And I repeatedly, Abby doesn't do this, but we buy it personally as well as for some investors. I sell too early, you know, the multiple gets really high. And I'm like, and, you know, it repeatedly, we've had ones that have gone far higher because the business was just so good and it may take a couple years, but that's where your big money is.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“It's hard to know which ones are going to work. So we'll do a bunch of, not a bunch, but carefully study a Hammond power and we'll talk to the management team. And you find No one's paying attention to these companies and they're working so hard and they're doing such a great job. I mean, heaven power has a really strong position in dry transformers and they hooked up with these distributors who could deploy their better solution more customized across very quickly across North America. And they were just starting to execute that. Bill Hammond, two or three times and he was so excited to talk to us, it seemed like we didn't know it was going to work, but they had very little debt. They had really good cash flow. We were paying a very low multiple. And that's kind of the formula. And that one worked out really well. We had another one, Duratech in Australia, this defense sort of contracting company, a rehab company. They basically go and defense bases will do work on them or mediation work, but it's low risk. It's just remediation. They're not building a new bridge.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“It's the guy running at Jim Clark's done a really good job, and he talks about they have a very strong sedu ratio. So he wants to make sure that they do what they say. They can do, and they deliver, and he puts it out there and they put projections. We like the management team that will stick a projection out there multiple years. Hey, this is what we think we're going to do. And we'll put our neck on the chopping blocks. If we don't make it. just that type of stuff. management teams that deliver and you can sort of read through what they're saying in responses and just their whole tone you could get a pretty good feel as to whether you could be comfortable with someone and we rely on that and the stock ownership is obviously important too but you can really get a sense of kind of do they under promise over deliver in reading through letters a lot of times and so we will definitely do that”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think this is again where you could look through the transcripts and you could hear the management team talk and you can go through what they're saying and you look very closely at it and you can really get a sense of what they're like and personality and kind of risk tolerance and how they answer questions off the cuff and do they want a Fort Knox balance sheet? Is that kind of how they roll? Are they sort of aligned with us? Do they admit mistakes? You know, Buffett's the obvious classic answer. You read his letters. He's very straightforward about what he makes a mistake. And so really going through those transcripts where they're asked questions, they're not really prepared for. We love that because a lot of times they're industry analysts. They're asking questions, but the answers are relate more to cash flow and stuff. And there's just great information there. And no one's really paying attention to the answer. And definitely, you read a few of those and you get a sense. We have, we own this lighting company LSI.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Do ask the management team well, how do you manage working capital? What's the incentive to tightly control that? And the companies that can spend that very quickly and efficiently, those tend to be pretty well managed. So that's an area of ROIC that we watched very closely at. Because I say the economy just generally has, it's a less capital intensive economy these days. It's you can rent almost anything with pay-as-you-go software or And so people are doing that and it's very efficient. Most of our businesses, as Abby said, have higher ORIC because they generate free cash flow. And if you stop generating the free cash flow, the cash from ops goes the wrong way. We're sort of looking at the exit door, just trying to really get comfortable with why is this happening? And we tend not to wait around for, you know, we don't trade a lot, but if something's sort of questionable, we don't always want to just wait around and see if it works out or not. We'll move on to something that's working.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Is the Kashromovs climbing based on the money going out? And the other thing we look really closely at is working capital, you know, companies that manage their working capital really well tend to have strong management teams and are very efficient and we came through the pandemic where people had to sort of expand their working capital and they bringing it back down. How well does the management do that? But you can go bankrupt if you're with no debt if your work capital really just goes the wrong way.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“We're big fans of the green black formula, which Brilliant, and the magic formula, and we'll even look on there sometimes, but good businesses at low prices. And so we look at that, the networking capital, and we look at the tangible assets of the business, the PP&E put those together and how much free cash flow or how much operating income or how much can that business generate. And then as it's sustainable, what trend is it showing? And the whole economy has become more of a service economy with higher returns, which is why sort of the multiples of these companies that seem really high, they might be a little more sustainable than people think. And so we really look for high returns on invested capital, sort of the operating income or sustainable operating income relative to how much assets it takes to sort of generate that operating income. And then what's the trend in that? So with a sprouts or with some of these other companies that are making investment in acquisition.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“And so, if something's working, you don't have a momentum person, but a lot of times the market won't react that quickly and it's executing. And you can see in the conference calls what's going on, you could get in there and take that ride. And it's a lower risk ride to us because they've executed all that. So that's sort of more on sort of the pre cash flow and how we try to sort of make sure sustainable over multiple years and has a history. It's not just a one-off.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“The people that do keto and vegan, and when the economy gets bad, they might buy a little less, but they're still going to go to sprouts and not Walmart. And they're overlap with Walmart was 10 or 11%. So it was a very differentiated strategy. But they had that cash to allow them to execute their strategy. And then they started opening up stores. And there, talking about free cash flow, we're laser focused on, okay, what's the payback on? You put that money out. How much do we get back? How fast do we get it back? Is the cash from ops climbing over time? And we'll stay in there. You know, that we'll redo our work. And so we did really well with Strauss. That works out really well for us. But we really try to look at a long track record. We'd rather pay a little more for a business and let it execute and have it be working than sort of take a risk and see if it's going to work or not. It's kind of like a great line by Tom Gainer. I was listening. He said, do more of what's working.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Powder dried to take advantage of really good opportunities. And it has tended to work out pretty well over touch. The other thing I would just throw in there is, again, you going back to Ben Graham, we look at multiple years of cash generation. So anyone can have one good year of cash generation. You've got a mortgage servicer and the rates are low. That doesn't mean anything to us. Tell us what she did over the last five years. So we really, like when we invested in sprouts, which we did really, that company had generated tremendous cash from operations when you added the last four or five years. It had no real net debt for grocery store, which is highly steady. It had a great new guy coming in with a strategy to differentiate. And it had Abby as a customer at their sprout stores, who I don't know all the keto and all the, but they had a strategy of like.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“And I would just say, you know, on the Fort Knox balance sheet, a company that has that kind of balance sheet, that's our kind of company. We're conservative. Somebody that doesn't want a lot of leverage. Now, some businesses, you can have the leverage and they can handle it and they're fine, but we like, we're happy with management teams that want that super strong balance sheet because you never know what's going to happen, what the economy is going to do, the tariffs, anything. When you've got a strong balance sheet, you can get through almost anything. The risk in the company is much lower and the market doesn't really tend to look at balance sheets until it becomes an issue in an economic cycle. And I think that's really missed. And we think there's a big factor of risk there that we try to adjust for. So we always talk about Ford Dalchi and everyone teases us about. And our fund has a Fortnite ground sheet because we're holding a lot of cash. But that's just kind of how we roll and we like to have our.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“The company Gus Cash, and we were investing in a very low multiple. They had very little debt. The guy running at the CEO was still there, had worked three or four, five years to build, to get to this point. You can kind of see that the work that's gone in. And when you're in a position like that, the shift in the business model often has multiple years to run. They've done a lot of work and you're sort of piggybacking on it. So that's when more worked out, but that's kind of how we approach getting out of a little bit of our circle of competence. And that one worked out really well.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“As always happens, we hung in there and we were reading the conference calls in great detail, and they were delivering everything they said. And this managed unit worked very, very hard over multiple years to build this strategic relationship inside the data centers. And they were solving problems for the hyperscalers that the hyperscalers didn't even know for Google and really sophisticated stuff. And eventually the market woke up all of a sudden and realized, oh, this is kind of a backdoor play on AI and data centers and they're deeply involved with these hyperscalers. And the stock went through the roof. But as always, it took a while for that to sort of happen. But we were sort of saying, gee, did we make a mistake or what did we miss or this thing's got a $12 or $13 price that's doing $2 earnings with no debt? What's going on here? So, you know, that's kind of an area where we're straying outside going into a new type of business.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“There was high turnover many, many years in a row. Investors just got really down on the company and the industry. And somebody had written about Flex and Celestica that the industry was changing and the relationships with the customers were multi-year strategic deep, deep, which was what we want to see. And so we spent our time in gradually built a position in Celestica, which was generating a lot of cash. We invested a very long multiple cash from ops, you know, five or six times with a great balance sheet. And we listened to the management team. We follow them for multiple years because it was an area that we were like, well, it looks like this is a real thing with these customer relationships. Then we had it at $10, $12 a share and they were doing $2 share earnings. And we were like, what are we missing here? This is insane. They have almost no debt. And so.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Just throw in there too one of the things we do that's kind of interesting we will go through the transcripts of conference calls and I've heard Brian others who's Really smart guys talk about this and go through word by word what is the management team saying for multiple calls do they deliver do they under promise do they overperform are they salesy are they you know and so here's what they told us was going to happen and does everything they're saying make sense and that's very interesting because there's a lot of information on those calls and they're getting asked questions off the cuff they're not read from a script and they will drop little nuggets of gold many, many times you can get an edge with what's going to happen. And so we tend to really when we have a good sized position of something hone in on those calls. Everything they're saying, you know, what's the tongue? Did they deliver what they said they were going to do? Did they under promise? And over deliver. And I think that is one way we do it. And then we did really well with Celestica, contract manufacturer, and the electronics manufacturing business had been horrible to invest.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Simple, cheap, and a lot of times we could find companies that are sort of boring. Their organic growth rate isn't very fast, but they generate a lot of cash and they're bolting on tuck-in acquisitions, and then they generate cash and they pay the debt off and they go do it again. And they can get very big over time and do very well. We've had some really good luck with those. So just stuff we can kind of understand. That's our sort of approach. Keep it simple.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“How simple can we make it? How, you know, and you look at Steve Jobs when he designed the iPhone and the simplicity he was focusing on, just how could he simplify it even further? So it's like Munger says, you know, invert, invert, always look at what can go wrong. So we're always trying to figure out, well, what can go wrong with this thing? Because stuff does. The world's very unpredictable. So simplify. And we don't really rely on projections. So you've got a picture of Ben Graham behind you there. When you read the intelligent investor, he's constantly talking about not relying on projections, buying businesses that are modest multiples of existing earnings. And then he goes back and looks at three or four or five years or 10 years of earnings and averaging that. And so we're trying to kind of do that, like what's already kind of working and has worked and can it just sort of continue so you're going to surf that growth path. Those tend to work really well for us. So we like to keep.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, and I'd say also the fewer things that can go wrong. Like somebody said, I don't know if Jim Roger, you know, that he likes to walk down and just seize a dollar on the ground and you stoop down and pick it up. And we're always asking, again, there's a lot of these elegant investment ideas with many pages. That's just not for us.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“One year of cash flow. We're looking at three, four, five years. How much cash is coming in against the enterprise value? And sometimes you could find stuff that, you know, the last three or four years, it's paid off the entire enterprise value. So it doesn't mean it's going to work. But if it just keeps going like it is, you can buy the whole company back. So we love stuff like that. Anybody buying massive amounts of their shares back, which is still a good balance sheet, we kind of stick to industries that we can sort of figure out and understand and anything that's kind of far afield or new or exciting, you can't really handle that. We'd rather sleep at night.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Would say we're looking for resiliency, we're looking for predictability. It's kind of the buffet thing of the you get a card with 20 punches your whole life. You're going to be pretty careful about picking those. So something that people are excited about, something that's volatile, something that doesn't have a long track record. We're looking for stuff that's really steady. I mean, you look at Buffett in his portfolio, he arms the economy, like, you know, whether it's a furniture company or a jewelry company or the railroad or he's growing with the United States economy. And so if you can do that and your business is maybe better than the economy and more resilient, you've got a winner. And so we really, you talk about a business we're not familiar with or we're probably going to shy away from that because we don't really need many good ideas. I think also the cash flow, if it doesn't flow cash and it hasn't over multiple years, we're not looking at just”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Are you gone through COVID? And all of a sudden, you don't have a good balance sheet. So it's just a whole process of how can we de-risk and defensively involve, invest in public equities. But there's so much brain power on VIC and some of these other sites. We're just looking for a handful that work for us. Doesn't mean that all the other ideas aren't great. It's just they're not kind of our type of thing. And we've kind of evolved to over time what produces the fewest mistakes because we're just trying to not make mistakes. We're not necessarily trying to hit the ball up. You've already brought up your circle of competence here, so let's turn to that. So even in your letters, I also have noticed that you bring it up quite often as well. So it's clearly an area that you focus on deepening and expanding over time. However, let's kind of consider here the circumstance when you're analyzing a company and maybe just a completely unfamiliar industry or something that you've never maybe looked at in the past, which is, you know, a”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“In public companies in North America alone, and we also invest in Western Europe, and we just need a handful. And so we're looking for a hack to slash those down to just a few that we can do a deeper dive on and start. And then the other thing is Abby will look at the track record of the author. There's nothing more important than does this person, he or she get things right? Do they not make mistakes? That's critical. Nobody's write-ups are really, they're 20 pages and the person writing it up is got all these great insights and they're really smart and we don't like that. We want something that you could, as Abby said, you know, do an elevator pitch to Peter Lynch, you know, writing down. And what are the key points? And so not that all the other stuff were great, but this is just what worked first. And then, yeah, we want the Fort Knox balance sheet. We want something because it really reduces risk tremendously to not have that leverage when you've gone through the financial crisis.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“We have a very simple approach, which is let's evaluate companies if we own the entire company. It's our company. You buy one share, you buy the whole company, right? What's the most important thing? Well, you want cash coming in. You know, a company that flows cash, you could sleep at night. It's not that the other company's write-ups aren't great ideas, but our approach and what's worked over time is companies that generate cash and then can use that cash and grow. And so we'll look at the enterprise value, the net debt or cash, the market cap, and then look at how much cash are we getting against that from cash from operations literally coming in the door, not EBITDA necessarily. And I would say, yeah, 19 out of 20 of the write-ups we read don't make sense for us, but we're sort of cutting them down very aggressively to just a handful that we can really hone in on. We don't need very many ideas, and there's 4,500.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“For having us. Yeah, thank you very much for having us. Appreciate it. I really enjoy it. So one thing that I found really interesting while reviewing your investor letters is just the frequency, which with you mentioned things such as the Valley Investor Club, sum zero, and MOI Global. So I personally have used Value Investor Club before and have been really impressed with the quality of some of the write-ups on there. So my question for you here for today is how has your strategy for generating ideas kind of evolved over the years”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Their approach to keeping things simple, how they say disciplined around portfolio construction, and some non-obvious signals that management is aligned with shareholders. One of my favorite topics was how they navigate the delicate balance between growth and value. While many investors put themselves firmly in one camp, they've managed to play both sides of the pendulum in a very value, accretive way. And their ideas just simply work. I recently came upon a tweet that showed the 30 best performing stocks in Canada over the last three years. And that was very impressed to see that Lowell Capital invested in three of them. And these three were in the top five of returns to boot. You also learned how they used cash as a strategic tool to navigate uncertainty, reduce risk, and seize opportunities while competitors are forced to the sidelines. Let's get right into this week's chat with Jim and Abby Zimmerman and learn how to buy growth businesses at value prices.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT
“Today's guests have outperformed the SP 500 for most of the last 19 years, all while holding a 20% cash position on average. Let that sink in for a minute. Outperformance and a hefty cash cushion? That's incredibly rare. The father and daughter duo, James and Abby Zimmerman of Lowell Capital have an investing strategy based on a simple but powerful idea, which is to focus on resilient and cash generating businesses that they understand deeply. This means they actively search for companies that have cash flow today, not tomorrow. They want businesses as close to the center of their circle of competence as possible. They're looking for overlooked businesses with Fort Knox balance sheets, which require minimal capital to maintain operations, all while factoring in growth. We'll explore their investing journey starting with where they source ideas from popular investment idea factories such as the Valley Investors Club. We'll examine how they use the equity bond framework to aid in their decision-making.”
2025-05-23 · We Study Billionaires · TIP723: The Art of Buying Growth Companies for Value Prices w/ Jim Zimmerman and Abigail Zimmerman · IDENTIFIED FROM THE TRANSCRIPT