YouSaid · the spoken record

Stefan Kaluzny

lines on the record: 72
first: 2021-10-21
most recent: 2021-10-21
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

“Knowing after the fact that you shouldn't have been more patient with that waiter or that taxi driver or whomever. But it is the habit of knowing that you will always feel better having been patient with them and having an unavoidable, proximate person that you love more than anything in the world with whom you have to be patient has helped me exercise that muscle.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“That is a lesson of late parenthood and late marriage. Patience. My four-year-old is teaching me patience and calm in the face of things that I may not understand or appreciate. And the power of patients in the face of that for candidly a very intense and highly strung guy with someone with whom I have to interact for the rest of my life, God willing, has taken the intellectual lesson of patience. This is a good thing. You should do this and made it something that you feel. And that, in my experience, is one of the most powerful ways as an older person to change habits. And the exercise of patience is about forming the habit of being patient.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Not that I haven't forgotten it on occasion, but my mother's originally from Houston, Texas and Southerners have a way with things, but catching more hot flies with honey than you do with vinegar is one that serves us well. The world would be a better place if we all lived that way.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“And so over 15 years, Michael has been a friend and a counselor and a guide and yelled at me for like, I'm not any good at pop culture, but there's a song about putting a ring on it or something like that. And Michael, who is old enough to be my father, knew this song in a way that I didn't and said, listen to the song.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“By now wife and then girlfriend to someone in order for her to become my fianc ⁇, I introduced her to Michael and his wife Arlene.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“They're too many. I would need to give credit candidly my partners at Sycamore without whom I could not have accomplished anything. But there are two, in my case, father figures, I suppose, in the business world. Don Maron, who has known me since I was a teenager and was enormously influential in my life, longtime chairman of Pain Weber and a civic leader here in New York City, and who we lost a little more than a year ago sadly. And then a different guy who remains a dear friend, Michael Weiss, who was the CEO of a company that I acquired 15 years ago. We had no pre-existing relationship, but I knew he was the right guy. And he catapulted that company to massive success and has remained a friend. He's on boards now, 15 years later. But when I needed to introduce”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Jargon double speak and code. So one of my rules that came out of the entrepreneurial experience is most of the time what I say and what you or any person, what one hears someone else hears are different. So 50% of the time what I say and what you hear are just different that we decide to compound that confusion by speaking in tongues. investment bankers having code words for we have a handful of people in the process is that three or is that four like you told me it's a handful and you won't tell me that it's three or four like it just tell me it's three or four but why make the world more confusing than it needs to be when you're trying to actually convey information to me it doesn't make any sense to me”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“That's my pet peeve, that like I come back and it's done something to itself. I can't even bark at the IT department. It's done something to itself and everything's not exactly the way it was yesterday when I left. And it didn't ask me. That's my number one pet peeve.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm probably a little obsessive, compulsive, so there are probably a lot of pet peeves. But the fact that my computer changes without my permission.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“So I mentioned earlier my parents both passed away when I was very young. And candidly, Kim, I say a small prayer to say thanks for the health of my wife and my boys. And I suppose by extension myself too, and I do it every day and you can't lose sight of it and nothing is more important than that. And so that would be my daily habit.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, I always fail at this question. So, I don't play golf. I don't play cards. I don't gamble. I don't have any hobbies. But I do have a four-year-old and a four-month-old. And having not learned to do many of these things myself as a child, circumstances not permitting, I am trying to learn along with my four-year-old to fish and to have that be something that we can do as an older father candidly. I want to be able to do it for every day for the rest of my life with my boys and maybe one day girls. If we're lucky, God willing. And so my hobby to be is to fish, but for the moment 100% of my time and effort is either work or putting my boys to bed and reading them stories or fixing garbage trucks or doing the things that dad needs to do. Apparently, nobody else can do.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“We need to supplement the trading and debt skills because that is a business of many decisions with imperfect information rather than few decisions with in a perfect world, perfect information. I believe that those teams need to be different and need to be separate because private equity teams need to not lose their orientation around more perfect information. And I believe that credit decisions are both a set of skills, the trading skills, where's the debt, where does it sit, how do you pay for it, how do you source it, et cetera, are different. And I believe that the many small bets to find few large is a different set of skills. And so we would recruit in the very best people on that side and bring to them all of the information advantage that we have from the private equity business to give”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“that lead us to having our own credit funds? Yes, might we need to manage the relevant conflicts between those things? Yes, but other successful investors look to Apollo and others have done that very, very well and grown their platforms that way. And I think sycamore can do that and can do that very, very effectively.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Has evolved and there is a need now to be more vertically integrated. We need to have active participation in the distressed credit markets to be able to take control of companies at an earlier stage because they are not being sold in bankruptcies. They're being bought pre-bankruptcy. And we did it last year with a company that we bought called Acina, where we took a position and bought 10 or 15% of the debt. We were part of the credit syndicate that led the company into bankruptcy. We then acquired the company from all the other creditor investors, which were otherwise going to take possession. But that early Toehold stake became an important part of buying that company. And the ability to do that as both a debt investor and a private equity investor is vertical integration that I think is important.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Continue to grow and to continue to develop, but we have a pipeline of young people that are coming along and we have plenty of room in our partnership. We were very, very lean through funds one and two. And so I don't think we need to be a $20 billion fund, but this size and modestly larger is the right zip code for our main fund. And that ought to be our vehicle. The companies we buy are generally in this size zone. And we don't need to just go do bigger for its own sake. Having said that, I do think that there are extensions. So the market has evolved. And while we are not exclusively a distressed company investor, as I highlighted earlier, we've made more money in growth than anything else, but we are willing to take on challenged or broken companies. And the market for those companies”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, 20 year old firm success is sycamore partners is known as the dominant consumer and retail investor, certainly in North America. And I don't feel the need in a $20 trillion North American economy to go overseas. We might, but I don't feel that need. But we should be known to CEOs and to investors as the single best partners to invest in a rapidly changing, a continuously rapidly changing consumer and retail environment at scale. That is success for us. I believe that that is a continued focus on our flagship funds. I believe that we should continue to raise in a perfect world successively larger core funds, but at this point we don't have to grow dramatically to make our business work.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“I have to ask you the question. I know that private equity firms grow or die. There's not an option. You want to incent people. You want to attract the best talent. You have to make some decisions about how you are going to grow. So how do you think about that? Is it a larger fund size? Is it moving into adjacencies? Is it a decision to go to new geographies altogether? How are you envisioning that? Your 10-year-old firm now, when you are a 20-year-old firm, what does success look like?”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“And that is still in a pandemic where we're underperforming. So there was an opportunity for value in the retail store network. There was an opportunity for growth in our B2B business. And there was an opportunity candidly for both in Canada. And that allowed us to de-risk the investment very quickly. And while I would have much rather for many reasons, obviously, not have had the last 18 months of COVID, we believe that we will continue to have a strong B2B delivery business coming out of COVID and two much better than anyone would have expected retail businesses.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Time that we've got here, we grew profits in all three segments dramatically. We remained very modestly levered so that when the downturn hit COVID has hit our business quite hard because offices have been closed. But when the downturn hit, we had sufficient liquidity and sufficient profitability to be able to weather the storm, to be in a position that when people do return to offices, we are able to service them in their offices, but that through staples.com, if they're going to work at home, we can still service them at home. And the miracle of miracles through all this is while we had written, underwritten for staples U.S. retail stores to decline in profitability from approximately 200 million to zero, this year, Staples retail stores will have the same 200 million of profitability that they had four years ago when everyone forecasted.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“And so we had a delivery mechanism and a logistics business that we knew was completely different and unrelated to the fact that it happened to sell office products. The 200 million packages a year and 40 DCs and thousands of trucks can deliver anything we want. And we need to find the right way to put more product through that pipeline, but we believe in a world that was evolving to next day delivery of lots of things that a $10 billion next day delivery business that was making three quarters of a billion dollars a year would have real value. So our approach was first to divide it into three parts, Canada, retail stores in the US, and the B2B delivery business, and then to recognize that each of those had their own profit, opportunity improvement. And so in the interest of the”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“We recognize that Canadian retail was completely different than retail in the US and that Staples, Canada was a wonderful business and is doing super well and has been very successful for us, even through the pandemic and the crisis. We recognized on the other hand that the Staples U.S. stores needed to be hived off and put into their own business because the years of sliding sales suggested that they were going to continue to decline and would ultimately need to be closed or liquidated. And then we recognized that the vast majority, 65% of the sales and 75 or 80% of the profits were really a B2B services company that was a logistics company to be Al Carant that delivered 200 million packages a year overnight to the Fortune 1000. So 200 Million packages a year overnight when Amazon was still on two day shipping.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“That grown from zero to 20 some odd billion dollars in sales in 10 or 15 years in the late 80s and throughout the 90s and had continued to succeed throughout the 2000s and had just been stalled. And we recognize that staples was not the company that appeared in people's imaginations. And so we divided it into three parts, maybe back to our classical education like Gaul. Caesar divided Gaul into three parts. We divided staples into three parts.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“So it may go back to the beginning of our conversation with that liberal arts education, which is GWiz, let me just see what this is rather than live by the power of my perception. When we acquired Staples, it was a $17 billion company, and necessity was the mother of invention. We had a two and a half billion dollar fund at the time, and so we needed to think about it as not this gargantuan company, but as something other than that. So we looked at it and said, gosh, staples, power of perception, this is this retail concept that no one has been in for the last five years and where the stores have been declining and everything you can get there, you can get it, Amazon, and isn't that easier and so on. And we stopped and said, gosh, this company had been an extraordinary company, right?”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“We would be remiss if we didn't spend a little bit of time talking about staples. It is in so many ways such an iconic sycamore deal. I would love for you to share with our audience how you guys thought about that. It clearly was not an investment that a lot of people thought was worth what you guys paid for it. And for sure, just they were just scared of the whole concept of it. So how did you think differently?”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“And we returned 50% of the investment in six months because we improved profitability because as value investors, we understood that, that made us comfortable. Then we said we have tigers by the tail, two tigers by the tail, and we're going to invest for them to grow. And in partnership with both management teams, they've been nothing short of extraordinary.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“And in the other case where people are effectively fans, hot topic is the seller of pop culture anything, they embrace their fandom on the web, but they want to go see each other at the store and be together there. And so our stores are growing even faster than our web sales. And both right now are growing in the 60s and 70s over 2019. They're staggering numbers, but we've embraced influencers in hot topic in a way that has evolved from even three years ago where we had embraced traditional social media, Facebook and Instagram. That had evolved from paid search of Google and God forbid Yahoo and other things of years and years ago. Technology has allowed us to grow profits in that mall-paced. Specialty retailer sevenfold over seven years.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Specialty retailers to being something very different. EBITDA, when we acquired the two companies together was about 65. We did it as a traditional LBO. We invested $250 million. And based on the market value of those two companies today, which we still own, one has gone public, the other has grown massively. We've made just short of 16 times our money on a $250 million equity check. That's not supposed to happen in the LBO business. That's not supposed to happen with a mall-based specialty retailer. But in one case, the business is now 70-odd percent on the web, but has three times as many stores as it used to have, where the stores are the single cheapest source of customer acquisition. She loves the product and she buys the vast majority of it with her phone, but she still loves coming to the store to try it.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“We don't think it's eating, we think it's enabling. As an example, we seven years ago, eight years ago, bought a company called Hot Topic. Now, some will chuckle and admit only to themselves that they know what hot topic is. But hot topic was the ultimate symbol of the mole rat of a certain period in the 90s and early aughts. And we acquired that business recognizing first that it was two businesses hot topic and another business called Torid, which really had nothing to do with hot topic but embraced large size apparel and body positivity in a moment when that wasn't, if you will, a current subject. And we recognized that this company was two companies and that both of them needed to evolve from being traditional mall-based”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“World, as you describe it, is clearly more bespoke and personalized to people's individual needs, which requires an enormous amount of technology to make that possible. Do you think, like everything else, that technology's eating the world is technology eating consumer in retail in ways that has made you have to rethink how you do your business?”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“She wants where she wants it. And most of the time, that is on the phone. And some of the time that is physical. And every business needs to be present where she wants to be in the way that she wants to be there. And we think that companies ignore that or are slow to embrace that at their peril. Now, we do believe in a balance of that, which is that the world being entirely digital is not 100% of the future. The pain and dislocation particularly in retail, particularly over the last”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Four things most human beings don't just go in and think about it as a four wheel thing with an engine with so many horsepower and seats that recline like this and have air conditioning. It's not the way they think about it. They think Volkswagen, Audi, Mercedes-Benz. And each of those things means something to them. So we think about brands, and that's a big part of our business. We think about distributors. Amazon is a distributor, but Kroger or Safeway is also a distributor. And I would argue that Home Depot is a distributor. So while many of those businesses are thought of as retailers, we think of them as businesses that are generally in the business of taking other people's products and getting them into consumers' hands. There's enormous change going on in that market, and we are firm believers that the consumer lives here. As a general matter, she wants”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, yes, we do. We have an investment framework that we think about, which is that consumer spending remains 65% of U.S. GDP, more or less. And depending on how you measure it, retail is $5 or $7 trillion business. If you throw in consumer products, you get to even more than that. And we think that consumers will continue to think about the world in three ways. They will think about things as brands. And brands are an indication of our shorthand for a set of attributes that they've come to love. And that doesn't mean that brands last forever or that they're never new ones or things can't change, but brands become powerful sources for a consumer's shorthand to either say something about themselves or to make a purchase decision. This thing provides me this utility in this way. But they are powerful shorthands.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“I appreciate the pain of this process because I experience it, but I will tell you that it will make you a better parent later on because you go from being a manager to be an advisor and consultant. I am in the consulting phase. It is very challenging, but this job has helped me with that too. Socamore is focused in the consumer and retail space. And that can be and is a cyclical business. But on top of that, it is going through tremendous transformation right now and arguably even disruption. Do you have a vision of where this industry is going?”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Admittedly, on this ultra-tactical narrow thing, that's the only way to teach them because it is an apprenticeship business and they only learn those things. And my job is on the one hand to be able to step back and say, let's go ahead and do this. This is us. Or on the other hand, to be able to say, I don't know if I would have said it quite that way. Which doesn't mean I'm 100% right. it does mean that we're having an exchange about how would I handle this.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“With the individual teams and then key in on specific things that they've chosen to do or that they've done where there's a lesson to be learned. Last night I had a conversation with one of our team members about a conversation he had had with a banker. He mentioned two or three things. I said, gee, I would never do that third thing. There was one of his partners was on the phone with him. I called that fella at 7.45 this morning, caught him in the gym, said, this is a two-minute blurb. I know this is not the way to manage these things, but I can't do it by text or email. I've got to call you so you know that I'm not angry or upset, but I would never say that. He then said, I didn't. This other guy did. This is how it went down. I said, great. As long as the lesson's being learned across the team that we should choose to do it this way instead of that way.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“And it is very hard to let go and let other people choose their own words and find their own ways. But back to some earlier themes in our conversation, what that means is I describe it as flying at two very different levels and just trying not to get stuck in the middle. So if you will, CIO, it is being able to step back with the team and say, guys, I recognize that we kind of squeezed for a million here or a million there, but do we like this deal? Is this in the shape of something that we like? Does this play to our strengths? And therefore, should we move ahead with this? And if there's something wrong with it, let's focus on what that is and see how we can solve for that. It's too big. It's not levered enough. It's too levered, whatever the things are. And then at the other end, it is to constantly be listening to the team and to spend time.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a work in process, Kim. So I'm learning every day and trying to get better every day at the evolution that is the job. The fact is at Sycamore, the most senior members of our team have been together for 21 followed by 16, followed by 15, followed by 14, followed by 13 years. And so we have enormous continuity. And that allows me to have a great deal of confidence in my team and has allowed me the time and space to be able to grow and mature as a manager. It is not an easy transition. Being a deal maker is a very specific set of skills, and I'm comfortable saying that I'm confident in what I was doing and how I was doing it and exactly the word that I chose under exactly the circumstances. And I was a sufficiently detail oriented micromanager that every word was chosen just so.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Can definitely see that. So let's talk about a different element of the decision to spin out, which is one of the things I think about in my career is I loved the moments when I was an investor, when I was a security selector. And then I became a manager selector. And that would transition was hard, but I did it. And then I learned to love being a manager selector. And then I became a CIO. And then I was much more of a people manager. Now, when you think about your decision to become a founder, how much of your day-to-day has changed from this incredible skill that you've developed as an investor to a manager of people and making sure you have everybody in the right spots and making sure that all the pieces come together? How do you stay involved?”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“After the fact. I know we've neglected a number of deals because of that or because we didn't have that pre-existing relationship with the manager and it was going to be a four-week auction at a high multiple. And we said, gosh, if we don't know these people, that's not as comfortable for us.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“So that's exactly right. And I spend far too much time examining this. But if there are things we've missed since we've found it sycamore, it is that in the absence of having that close relationship with someone who is going to lead the company and who we feel is just right, we have not always chosen to take risk on just an asset or just a company where the company's fine or maybe the company's terrific, but management is not so terrific. And while we've been willing to replace management, we've more often than not had someone in mind. And that probably means we haven't taken on as many projects as we should have knowing that we would ultimately solve that problem. And that is something that we've had to get better at and get more comfortable with, that we will solve the problem.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Better investment results, higher returns, lower risk, faster return of money, along with candidly fewer person hours invested in the effort because there's so many things that you know and understand about each other that you can move quickly to make very, very informed decisions. And you know things about how you think about the world that allow you to make better decisions faster.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Firm from which I joined had more traditional investment committee approach, which meant that we were less able to stand by our almost personal commitments to those executives in the same way because there was maybe this week the portfolio wouldn't be interested in that because we were rebalancing this way or that way where the commitment to do great deals with great people and to know that we are going to be in this business with these people for as long as we're in business is an incredibly important point and an incredibly valuable selling point and has been true of a number of our investments where we've remained partners with our CEOs on multiple occasions in multiple contexts and across multiple deals and that has created nothing but”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“they mature, they decline, they get sick, they get better. There are a series of things and they have their own life. And candidly, chief executives or management teams also have a life cycle of their career. And real magic is made when you marry the right manager with the right company at the right moment in both of their lives or in both of their evolutions. That means not only knowing the relevant managers. We have a list and we met them and we have outreach and BizDev people and so on and so forth, but developing a career-long relationship with them to be able to deliver for them and spend time with them on multiple occasions and to be able to have them endorse you for the next person or to work with you across more than one deal or those kinds of things. And the previous...”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, I did found sycamore with an eye to doing some things that were an extension of everything that had gone before the previous 10 or 20 years at that point of my career, both as an entrepreneur and as an investor. We were building on things. So there was much that was the same. There was one very specific set of both values and activities and approach to the investing business that were deliberately going to be different. We founded Sycamore as a sector-oriented fund, so we'd left a fund that was multi-sector and created a single sector fund focused on the consumer and retail market. And to my earlier comments, my investing experience had informed me that real success in the approach that we have is marrying two separate things. So on the one hand, we believe that companies are organisms that have their own life cycles. They grow.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, for sure. So let's talk a little bit about sycamore. This is like one of my favorite questions to ask. So in 2011, you decide to leave your prior firm where you had developed your amazing investing skills and you built out your network and you decided to spit out. I know that's never an easy discussion, but you did it. Did you always have a desire to found a firm or was it as a result of making a decision that I can do this differently? I always ask people what things were you trying to correct for in your spin out and what were the unintended consequences.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“That has probably been the largest missed opportunity over the last three or four years in particular where growth has particularly outstripped value or where there have been a lot of opportunities in higher multiple companies that have gone much higher yet again.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a very powerful and important insight that that sounds like relatively young entrepreneur has realized. God bless her for having captured that lesson early. It's maybe a different part of this conversation, but candidly, the single largest investment regret I have is having traditionally been a value investor, not having recognized the power of growth over the last five years and pivoting our portfolio to embrace those models at what appeared to me to be relatively high multiples because having had a history of counting pennies and being thoughtful and worried about what can go wrong and worried about falling backwards rather than the unabashed pursuit of risk, I'm not suggesting that's the case or that's the right answer, but balance”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“And I laugh thinking about how you made the decision about that first job, counting down the pennies because I did the same thing. And there are so many people who don't come from a background where they need to necessarily count down the pennies at the time. And they think about those decisions very differently. I had a really interesting conversation recently with a young entrepreneur who comes from a different background and she said, I realized I had to add people to my team who were more privileged because I was so busy counting pennies because that was my history that I wasn't being sufficiently optimistic and wasn't reaching high enough. And then once I did that, I had so much more balance in my firm.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Enormously helpful and surprising to me, remarkably scarce. The number of chief executives who continue to say to me, gosh, the way you talk about the business and the way you talk about your business is so dramatically different from the other five private equity firms that we've encountered remains a shock to me. It is something that we've built into the water of our culture here at Sycamore Partners, and I'm incredibly proud of the fact that whenever I talk to CEOs about our teams after the fact, they all say your team was the nicest, was the most considerate, was the most thoughtful of my, the CEO's team. And those are the kinds of lessons that we've tried to inculcate that are different than, hey, we've got a spreadsheet and we put the numbers on a page and they pencil out press print and Let's go.”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source
“Take the lessons of being a chief executive of a company and apply them more as an investor, being a partner to chief executives rather than committing my life to a single company. And I have found over my 20 years now in the private equity business that many of those lessons that came out of those seven or eight, very challenging, very hard, very intense years of running and building a company remain true today regardless of the size of the enterprise. And as you said a moment ago, the things they were trying to teach us in business school are lessons that we only came to appreciate 20 or 30 years later that it's all about the people and it's all about how you interact with them and how you manage them and how you partner with them. And I learned many of those lessons the hard way as an entrepreneur and found that I could put them to use in the investment business and they”
2021-10-21 · Capital Allocators · Stefan Kaluzny – Sycamore Partners [Manager Meetings, EP.16] · IDENTIFIED FROM THE TRANSCRIPT · source