Approach
We are buying a business and the people who run it.
The first is work. The second is the harder half, and where most of our time goes.
The two lists
What we look for, and what ends the conversation
The second list is the more useful of the two.
What we look for
- GovernanceStrong ethics and sound values are a filter, not a value-add.
- CaptainsSomeone is unmistakably at the helm, and accountable for where it goes.
- Ambition to outlast themselvesAn institution being built, not an income being drawn.
What we avoid
- Exit-led structuringWe do not buy a business in order to arrange its sale.
- Positions we cannot explainIf the case will not survive plain language, we do not own it.
- Running to a processA banker, a data room and a Friday deadline usually means we are the wrong buyer.
Our best decisions have taken months.
What we back
Going up the value chain
The businesses we like are in the middle of getting better.
A company that has finished improving is priced as though it never stops.
We look for businesses moving deliberately — out of job work and into specification, out of contract manufacture and into a product of their own, out of the domestic market and into one where approval takes years to win.
Each of those moves shows up in capital expenditure and hiring long before it shows up in the margin. That gap is the whole opportunity.
Where we invest
The business decides, not the wrapper
Listed or unlisted. We are largely indifferent to which.
A good business is a good business whether or not it happens to have a ticker.
We are under no obligation to deploy by a given date, and never forced to sell one holding to fund another. If we find nothing worth owning, we buy nothing.
Where the edge is
The plants nobody visits
Not an argument about the country. An argument about what is still unexamined in it.
India's advantage is the density of good operators — families in the same industry for three generations, run by people who grew up in the factory and know it better than any analyst will.
Much of that is listed and barely covered. Businesses with real competitive positions go years without a serious analyst visiting the plant. For anyone willing to do primary work and then wait, that advantage has not been competed away.
If this sounds like your business
We would rather hear it from you than read it second-hand.