06/27/2022
Peter Lynch once advised investors to “go for a business that any idiot can run, because sooner or later any idiot probably is going to be running it.”
Far be it for me to question an investing legend, but what if in addition to searching for a great business, we also tried searching for a great CEO?
The book The Outsiders argues that there are observable characteristics that produce superior results. This week I give three examples of relatively new public companies led by guys that seem to fit the “outsider” criteria.
BTW, if any of you know The Next Warren Buffett™, please hook your boy up.
Peace out.
Mike
Featured Article
Baller CEOs That You’ve Never Heard Of
by Mike, Tycoonist Creator
Business Leaders
William Thorndike’s book The Outsiders argues that the best CEOs are usually great capital allocators, i.e. they’re good at investing the company’s money. How awesome would it be if you could spot one of these wizards early in their career?
Here are three CEOs who might be considered contenders for the “new outsiders” based on how they’ve been running the show so far.
Warren Kanders, 64 (CEO of Cadre Holdings)
Over the last three decades, Kanders has been involved in leading four successful public companies, including one that compounded at a 49% annual growth rate (not a typo) over just 10 years.
Brian Kahn, 46 (CEO of Franchise Group)
One example of Kahn’s dealmaking prowess is his acquisition of furniture retailer W.S. Babcock. Kahn paid $580M for the company, then proceeded to sell its real estate and receivables portfolio for $668M.
Brett Kelly, 47 (CEO of Kelly+Partners Group)
Kelly is a Warren Buffett fanboy. In his spare time, he conducted interviews of successful Australian investors and published them in the 2020 book Investment Wisdom.
Business Bites
News, Memes, and More From Around the Internet
Energy Crisis = Hunger Crisis
Economics
"I think the combined impact of infectious diseases and the food shortages and the energy crisis... we can be talking about millions of extra deaths because of this.”
Peter Sands, director of aid organization Global Fund to Fight Aids, Tuberculosis and Malaria, has warned that the global food shortage/price surge could lead to millions of excess deaths among the world’s poor.
Even in 2022, starvation remains the world’s leading killer with over 9M hunger-related fatalities every year, far exceeding the annual death toll of Covid-19.
Analysis: Energy prices heavily influence food costs. One 2019 study found that 64% of the variance in food prices can be explained by oil price movements. Fossil fuel inputs permeate the supply chain, all the way from natural gas for fertilizer to gasoline used in transportation.
Over the last year, we’ve covered the profound energy ignorance among the investing public and profited immensely. The tragedy is that millions of people will likely suffer and perish because of that energy crisis (do with that information what you will).
They Were Last Season’s Winners!
Stocks
A popular June 2021 Twitter thread by a prominent FinTwit personality purportedly listed 20 crowdsourced stock picks with the potential to make 50 times your money. A few of these predicted future mega winners included Wish, Beyond Meat, and Redfin.
Narrator: On average, those top 20 picks have crashed 70% in value. Not a single company on the list is down less than 30%.
The incredibly shitty performance of these highflyers underscores how difficult it is to pick individual stocks. A landmark study by financial economist Henrik Bessembinder found that just 4% of all U.S. stocks since 2026 account for ALL of the market’s outperformance compared with government bonds.
The idea that the market as a whole goes up over time (while most individual companies cease to exist) underpins the argument against picking stocks.
Memes and Sarcasm
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Contact
Email mike@tycoonist.co or reach out on social media.