Good Companies

What we look for 

  • High return on invested capital without leverage or accounting tricks

  • High free cash flow conversion

  • Sustainable Competitive Advantages – network effects are the strongest, others include patents, licenses, low cost, brands

  • Pricing power based on a franchise

  • Non-cyclical businesses always worth more than cyclicals

  • Platforms used by other businesses to build out their own businesses are the new royalty model; get to ride on the coattails of others

  • Company operates at the top its value chain

  • Prefer businesses that can be run by a fool, one day they will

  • Predictable economics in the long-term