YouSaid · the spoken record

Scott Sperling

lines on the record: 58
first: 2021-05-21
most recent: 2021-05-21
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

“So it's a really it's a fascinating thing because I'm not sure there's one thing. But I think understanding that there are points, there are various points where you think the downside is reasonably limited where it's not things can always be dramatically worse than you might ever anticipate. But conversely, there are opportunity sets out there that one needs to imagine clearly with some analytical basis, but one needs to imagine as upsides that are not part of conventional thought. And so understanding that the range of outcomes can be much more Than you think is something that you learn over time. And being unbound by often conventional thought is one of the more critical skills to acquire as you're in our industry.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“it's a great business it's a great business it's a great area try to get involved in it if you really fundamentally love building businesses there are probably easier jobs to have if one's looking at it just from the financial aspects I really do think our industry is about helping make companies better and being involved with management teams that can be true partners so if that's what excites you if you're really interested in helping build enterprise this is a great a great industry to to do that from”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“There are some interesting areas like AI superpowers as a way of really understanding China and what they're doing and how they approach that incredibly important area. I recently reread the best and the brightest, which was probably about my fifth time, because I think that there's continued lessons to be had about how we approach the world and the importance of avoiding Hoover. So, you know, there's a range of things I think are really interesting.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, you know, right now I have a few I'm reading kind of on a range of things. You know, I think the Jim Collins book Built to Last is pretty interesting right now as a kind of a survey, a wide range of different companies doing things differently and trying to understand how you make breakthroughs in places that have a long legacy of success. I've had fun reading the dynasty. The crafts have done such a remarkable job at building a franchise that I think sets the standard for sports teams and other organizations, other types of organizations.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Than what almost anybody else was thinking and how he was able to turn a lot of that into new realities. And that's been something that I've long valued both the personal relationship with John, who passed away over the last couple years. And the learnings I got from his ability to take a step back, think out of the box, and then turn some out of the box thinking into realities.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Of the great experiences that I've had is working with John MacArthur, who is a longtime dean of the Harvard Business School, and who first got me involved in what's now the Mass General Brigham Health System when he was the chair of the Brigham and then became the founding co-chair of what was then called Partners Healthcare, which is now morphed into the Mass General Brigham system. And John was an iconic figure at a Harvard Business School. He and I shared rugby in common, so I had gotten to know him a little bit through that. And then watched his ability to look at a situation in ways that were innovative and different.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Tom Lee, when we work together, Tom had this great ability to really like any deal. And what he was looking at was an ability to look for the opportunity set on things and learned a lot of that from Tom. And as I go through the various relationships I've had over many, many years, there have been an extraordinary number of people who, even though they were more on the peer side than the boss or older mentor side that I've been able to learn from.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And Walter was incredibly supportive of the efforts that he had me undertake to move Harvard into these alternative asset spaces well before almost any other endowment or foundation. And he was just an extraordinarily smart and supportive boss to have and really launched me into the career that I have now. And there were people along the way who taught me lots of different things. I remember Floyd Kwame at Kleiner Perkins, who we co-invested with when I was at Harvard. He was one of the general”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, you know, I would say one really important mentor very early on was Walter Cabot, who, as I mentioned earlier as the CEO of Harvard Management Company, actually started Harvard Mansion Company for Harvard. And just a remarkable individual who I think had both great success in traditional money management and yet also had the foresight to push Harvard into areas that at the time were not consistent at first thought with what they used to call the reasonable man rule, which was a general rule about how the nature of the risk one could take with endowment and foundation assets.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, my wife and I have kind of gone through almost everything one can watch on either of those channels. I mean, I'd say our favorites were things like Queens Gambit, which I think lots of people have really enjoyed. You know, there's a wide range of other things that go across a number of different genres from Bridgerton type thing to the Great on Hulu. So we're always looking, we probably spend 10 minutes trying to figure out what to watch almost every night. So, you know, lots of different fun things.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Or two. But the team, I really think they're on the right track now. I think Leon Rose has done a very nice job of putting together a team that has a lot of upside to it with a coach that has finally returned the team to its roots of being a very tough, defensive-minded squad. And so I'm optimistic about the future. But as a... Longtime Knicks fan myself way before I joined the MSG board. I'm just very happy to see the success they've had this year.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I was on the board of MSG. I'm not sure it was for quite that long. And the team certainly had, as you point out, significant ups and downs and even more, I guess, significantly a long period of not getting anywhere near the success that fans had wanted. And I'm no longer on the MST board. Anyone could have a bad decade.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Of what your target universe is. So the strategic partnership there, I think, is important to the GP. And for the LPs, it's a way of participating more broadly in private equity where you're not necessarily paying the same kind of fees and profit participation to the GP that you would on the investments that you make directly into their funds.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think it's something that's been developing over the last decade. It's something that we've been very focused on as the strategic partnership that you can have with your limited partners. I think a lot of firms in the industry have been thinking about it in a similar way. And it allows you, particularly in a world where it's not clear what the pace of investing could be if one's trying to sustain the kind of high returns that our investors expect and that we want to be able to provide them, it allows you to size your fund in ways that give you a reasonably high level of assurance that you can maintain the disciplines that you want in order to achieve those returns and allow you to scale up on transactions that are on the larger side.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And Duncan Brands is one of them, and we partner with Carlisle on a couple of things as well. And that has really evolved more in today's world to a single GP buying a company with the support of their limited partners who co-invest in that deal. Now, we're also seeing some rather large transactions happen again. And in those transactions, you might, you're starting to see the so-called club deal come back because the ability to underwrite those transactions may require more than one general partner. So the world, as you had mentioned earlier about cyclicality, the nature of valuations going up and down.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So there was a period of time where the size of the transactions or the nature of the transactions in private equity, in the buyouts of private equity were required more than one firm. And it was a point in time when the availability of capital was really from other GPs. Today we're in a world where we have just some phenomenal limited partners who are anxious to be co-investors in transactions. So in today's world, we rarely have another general partner in a deal. But back in the 2000s, and in fact even in the late 1990s, it was more traditional given the size of transactions and the size of our funds to partner with another general partner or more than one general partner to acquire a company. So Bain Capital was a partner of ours in a number of different transactions.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Oh, I think it's a crucial word in the investing universe because what we're trying to do is look for companies that are on the right side of disruption and always be aware of the business models that could be disrupted by new technologies or new entrants that bring in a very different model to a given industry or sector. And so we spent a lot of time trying to make sure that we are on the right side of that, as I just said, as opposed to being put in a position our entire business model can be undermined by new entrants who disrupt the traditional way that businesses done in that industry.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“to be able to do the kind of detailed analytics that we like to do to have a reasonably high degree of comfort about the next three years are going to look like.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Will look like in any given one, two, three, let alone five to ten year period. What we're trying to do on our side is invest in companies where we think we have enough data to have a reasonably high probability of achieving at least a three to five year set of projections. Obviously a lot harder to go past that. And so we spend an enormous amount of time trying to model out particularly the first three years of growth of a given company looking at the broad range of market conditions that allow for that growth and where that specific company may be in the competitive set of companies trying to serve that market. And so we're making less of a venture bet and more of a bet on something where there's already at least sufficient”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think you're pointing to something that probably is characteristic of the differences between the venture capital side of private equity and the buyout side and growth equity side of private equity. So I think on the venture side, when you're investing in very young technologies, new technologies, you are making a very broad based bet without the ability to have any level of precision about what those numbers”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“serve consumers and businesses in their key business processes. Blockchain is an interesting technology in that regard that I think we're still in very early innings. I would separate blockchain from cryptocurrencies like Bitcoin, even though they're often put in the same category. We have not really focused upon the cryptocurrency side. It's not an area that we have any traditional strength in. Obviously, we've been fascinated to watch the explosion and valuation of these cryptocurrencies, but don't really have a strong view on it.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, so we have traditionally been focused on supporting companies that provide technologies to the more asset based part of the financial services world. So we were the sponsor of companies like Black Knight Financial, which is the largest provider of technology services to the mortgage world. Mentioned FIS. We are very interested in companies that can help the various parts of the insurance value chain do their jobs better. Wealth management, again, is a really interesting sector that we've participated in and where we think that there are ways of improving the ability to serve clients through the utilization of technology. So in the financial services world, we've generally been focused on how to help the kinds of companies that direct”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“For us, it's, again, the areas that we've had very long base of experience in that we think we'll be able to ride through a more traditional economic cyclical downturn. And so that would be things in the financial services fintech space. We talked about healthcare where we see, again, a broad set of opportunities that tend to be much less cyclically sensitive. And then the areas of technology and automation that will continue to be deployed almost regardless of the economic cycle. And it's not to say that these areas won't see some adverse effect during an economic cycle, I think. They generally will, but it will be a much softer downturn than you'll see in industrial industries process. Industries and other sectors that have tended to see much sharper ups and downs as we go through the traditional economic cycle.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I would say distressed opportunities were here and then gone in about a nanosecond. There were a few things that got done in the industry that I think was characteristic of distress investing, but primarily that disappeared as we saw that very sharp V-shaped recovery. So much of what we were doing was, again, focusing on areas that we felt had that strong secular growth to it. And one of the benefits of strong secular growth is it tends to be less adversely affected by cyclical downturns, whether it's caused by a normal economic cycle or in this case by the pandemic that again led to an unprecedented shutdown of the economy.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I was less surprised by the nature of the collapse given the fact that we had this unprecedented shutdown to our economy and much more surprised by the speed at which it came back. I think early on people were dismissing the possibility of a V shaped recovery, particularly a sharp V. And those of us who were doing that were completely wrong. I think what we didn't anticipate was the unprecedented level of both monetary and fiscal support that we saw occur here in the United States as well as around the world.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you know, and again, I think it goes to this issue of are we measuring things correctly and do we have the tools, as I mentioned earlier, to actually measure things appropriately? And because of the incredible complexity and specific nature of patients' conditions, it's often hard to do that. And so the proof points are more in the outcomes that we see for patients with extraordinarily difficult conditions. The way that we provide care on the more primary and secondary side is something where it's a lot easier to look on a comparable basis across systems to see what the most effective and yet cost effective Ways of providing primary and secondary care might be. On the tertiary and quaternary side, it gets a lot harder for the reasons that I just mentioned.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Women's Hospital or Mayo Clinic or a Cleveland Clinic. And so you might be in order to deal with this issue of high medical expense. Now I would also note that the United States benefits right now from having extraordinary healthcare. And one of the proof points of that would be the number of people who come from all over the world for care, particularly at the very high end of the acuity level people who are reasonably sick want to come and be treated here not as much people here going to other places.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, it's a really interesting point, and I would say that first start with the question about what are the right metrics and why can't we measure them uniformly across the system? And one of the things that I found has been in chair of the Mass General Brigham healthcare system for a number of years, and it's one of the countries, in fact, the country's leading high-end clinical and largest research and teaching institution, is the complexity of disease states, the nature of patient condition is so complicated that at the very high end, which is where much of the cost is, it's very hard to get apples to apples comparisons, and that is exacerbated by the fact that the most difficult cases will flow to the highest end providers, will flow into a mass general hospital or”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Biotech industry, that is continues to be an enormous and expanding opportunity set and the ability to support companies that are able to provide various forms of care at more effective prices so that we can reduce the total medical expense to the system is something that is worth focusing upon. So I think the pandemic in terms of healthcare investing reinforced a set of opportunities more than created any truly new opportunity sets.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I would say that the biggest impact was the recognition that there are a set of tools out there that allow you to operate in a virtual world incredibly effectively. And for us, those are tools that we had not used before. And we're finding that they'll be incorporated in how we do business going forward. In terms of the opportunity set in healthcare, I don't know if there was any great realization of new opportunities coming out of the pandemic as much as there was a reinforcement that we are in a world where the, you know, as I said earlier, the ability to support companies that are able to provide a broad range of services to the pharma.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Whether it's Salesforce or the development of selling strategies more broadly and help these companies do all of that while allowing them to focus all their energy on the innovative science that I think is good for the world as well as presents a broad range of investment opportunities.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Cardiovascular diseases as well as a number of other areas. So we're going to see, I think, a continued explosion, if you will, of therapeutics and diagnostics. And there are entire industries that have been set up to support the companies that have the innovative science that they will develop into those drugs. ability to provide services to the specific pharmas and biotechs who have the innovative science is something that we and many others have been focused on. So whether it's the outsourcing of the clinical trials through CROs, it's the ability to provide a broader range of products and services. It's the ability to take some of the commercialization activities.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“But also on the therapeutic side, yet one more tool against cancer and other rare diseases. So I think the example of what we've seen over the course of the last year is not just a one-off, but is actually a microcosm of the opportunity set that exists in healthcare as the number of tools and technologies that we develop are allowing both a faster and more effective development of a broad range of therapeutics and diagnostics that go right to the heart of solving a number of difficult disease states across various cancers.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think we have seen something pretty amazing over the course of the last 14 months, which is the ability from a standing start to rev into a pretty amazing product when you think about the number of effective vaccines that we now have. I think most interesting has been the development of the mRNA vaccines because that's not just a single product, but that is a platform that has not produced therapeutics or vaccines before that can now be utilized to address a range of both vaccine opportunities.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“The skills gap has been, as you point out, well known for quite some time, and I think there is an enormous and appropriate focus on making sure people get the education and the training to allow them to fully participate in the technologies of the future and the job sets that are opening up in those areas. Automation, again, is going to be able to fill in for the jobs that people really don't want to do and also allow for improvement in the productivity that will allow companies to sustain higher levels of compensation for their employees and still deliver the profitability that their shareholders and other stakeholders are looking for. And so automation will play an increasingly important role in Broad range of industries as we go.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Both industrial and on the distribution warehouse side that enable us to fill the gaps that can't be filled because of the difficulty of finding employees to automate jobs that are more mundane and allow employees to be really focused on the higher value aspects of the tasks at hand. And these companies continue to find new areas to expand into. So we're going to see much more automation in the office space and financial services and healthcare, all again things that will improve productivity, fill gaps in employment, and allow employees to see the benefit of that improved productivity through higher wages that can accrue to the existing employee base because of the improvement in productivity and profitability”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Our strategy has been to identify certain subsectors that we think have pretty extraordinary growth characteristics. And one of the ones that we have been involved in and have talked about a lot over the course of the last five or six years has been automation, where we believe that there are very strong sustainable secular growth drivers that are going to be sustained for probably at least a decade. And we are in a world where we know that there are significant labor shortages, where there are strong secular trends like the move to e-commerce, all well known to everyone. And we've seen the ability of companies that have developed capabilities and technologies to automate a whole series of”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“We had long participated in different parts of the financial service world early on looking at opportunities in balance sheet driven businesses, banks, reinsurance companies and had developed a successful track record there. And that migrated to looking at companies in more of the fintech area. And as I think is all publicly known, we were the key financial partner in the FIS transaction that was done with Bill Foley and Fidelity National. A couple of our partners, Tom Haggerty, Ganeshrau, plus a number of others, have been very involved in a broad range of transactions since then in that sector. And so as you point out, it has been an area of specialization for us.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“In the cash flows of the company. And it was one of the deals that was a precursor in many ways to the model we see today, which is be able to add significant operational value to a company in ways that allow it to significantly increase its cash flows and sustain higher rates of growth in those cash flows than it otherwise might.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“We were looking at the opportunity to buy an iconic company that had been part, that clearly was a key part of the history of Time Warner, but where the parent had kind of moved beyond that particular sector. And we believe that the ability to see a transformation in the way music was distributed presented a broad set of opportunities that we could reasonably quickly take advantage of. And so we and our partners, particularly Edgar Braunfman, who we brought in as the CEO of the business and who had a long and deep experience base in music and entertainment more broadly, had a plan that we were able to implement very quickly that allowed us to see significant growth.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“will continue to look for transactions individual firms will look for transactions that are appropriate relative to the size of their funds. Some of us are focused on what we would call middle market. We are focused on middle market growth companies. There are other firms that are spanning into what you would call very large enterprises and again that reflective of the fund sizes that some of them have raised or are targeting.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, a decade ago, we were seeing some very large deals occur. You were seeing some twenty percent to forty five billion dollar buyouts a decade before that. You were orders of magnitude lower. So to your point, most deals were being done less than a billion of enterprise value in the nineteen nineties. There were a handful of deals that were done that were significantly larger than that, but those were more anomalous than the norm. Today,”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“At many points in history, and I would expect that if the base rate increases that you're going to see some contraction in market multiples, and that'll flow through to what we see on the buyout side as well.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it's a funny thing people say what's going to happen when interest rates go up. Is it going to make your business much tougher? And what we normally see when interest rates rise is the obviously the inverse on the multiple side. And that's because there's a clear relationship between the cost of capital and the multiple you can afford to pay for a company. So I think those things tend to self correct if we move away from this relatively inexpensive debt capital that we are currently seeing. Clearly the very low base rates that we have have allowed the markets to achieve overall multiples that are higher than on an absolute basis than we've seen at”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“About that same category as the acquisition multiple. So for example, you could pay fifteen times for a company, but you would like to believe that that's growing at about a 15% carrier on the EBITDA or cash flow side. What you don't want to do is pay 15 times for something growing 5% or 7%. And so, you know, as we look at the world, there are enterprises out there that are in sectors that we think have very significant growth opportunities going forward. And you're going to pay a multiple that is reflective of that. Just try to stay away from paying multiples on the EBITDA of the company that is a much higher number than that sustainable growth rate.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So generally, we're trying to buy companies reflective of what you might call the intrinsic or fair value of the company. And as we've looked back over time, the key drivers of that would be the return on invested capital characteristics of the specific company and more broadly the industry. And secondly, and perhaps over a broader range of calculated outcomes, it would be the sustainable growth rate of the company. So we're very focused on buying companies where the acquisition multiple is reflective of what we believe to be the sustainable growth rates of that enterprise might be. And one of the things that we have learned over time is you can pay a reasonably high acquisition multiple if you believe that sustainable growth rate is”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“both in domains, the subsectors or industries that we focus upon and also a high degree of expertise in being able to improve the key business processes of companies in ways that allow that company to increase its competitive position such that we can drive higher rates of growth on the revenue side, make the company more efficient so that we can drive even higher rates of growth on the profit and cash flow side.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I've long learned the hard way that I'm not great at predicting the future in lots of different ways. So I can't tell you that we'll never see it again. What I will say is that there is an awareness on the part of sellers of the value of leverage. That was something that was less well known in the 1980s and even in the early 1990s. And the nature of what we do really is much more dependent upon picking industries and sectors and subsectors wisely and then having the ability to drive operational value improvements at these portfolio companies. That is a skill set that requires a large number of expert individuals who have specialization”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I've been doing it for over 20 years. It's worked out extraordinarily well. I think we try to bring together talents that are complementary. And when you're looking at the broad range of tasks at hand with a firm like ours, it's always nice to have a partner to talk to.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Ability to significantly grow revenues where you could bring at least some strategic direction to the founders of that company that allowed for the growth to accelerate. And that's one of the things that we saw on SNAPL. And that became a model for a lot of other things that happened in the industry. In the mid-90s, my partner Tony Denovi and I were involved in the buyout of the TRW business, the information services business that became Experian. And similarly, things like Fisher Scientific, where we were identifying opportunities where the ability to significantly Grow the enterprise was how you were making your money again, not just on buying something that was inefficient and perhaps aggregated in ways that made less sense than disaggregating them.”
2021-05-21 · Masters in Business · Scott Sperling on Innovative Investment Strategies (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source