Chit Chat Stocks - Alteryx, Slack, and Data Analytics with KermitCapital

Episode Date: October 6, 2020

This week on Chit Chat Money your hosts, Ryan Henderson and Brett Schafer, welcome KermitCapital (20:40) and discuss what using data can look like at different companies. Prior to the interview (2:09) Ryan talks about The Art of Selling, Brett discusses Roblox and the two talk about the current state of Fintwit. As always, on the back half (1:04:46), find Hot Water, FMK, and Anecdotal Evidence. Enjoy the Show! --- Support this podcast: https://anchor.fm/chit-chat-money/support Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices

Cox Panoramic Wi-Fi includes advanced security to help protect all your connected devices. You'll get real-time alerts. Oh, like this one, so you don't have to worry about malware. Or when your kid downloads a song from a shady link. And now all your computer can play is... Red color, red color, where are you? Ah, all blocked, thanks to advanced security, included with Cox Panoramic Wi-Fi. Advanced security must be enabled in the Panoramic Wi-Fi app.

Restrictions apply. Welcome to Chit Chat Money. Today is Tuesday, October 6th. Sixth. Apparently I say the word sixth weird. Revenge of the sixth. All right. Well, anyway, we have an interview with Kermit Capital today.

It was fun. We talked Alteryx, Slack, lots of Amazon. He actually gave us some interesting insights on Amazon. He used to work there. yeah so uh that was an interesting tidbit as well and then before we get to our interview we have our stories for the week what do you have yeah i got roblox so there's a rumor they probably leaked it that they're going public um and i think it's a very interesting company even more interesting maybe than epic games itself um in the gaming space so really excited about

that um and there's no numbers but it's just gonna be fun to talk about anyways and i think it's a company people should know how it works because it's really popular okay and i have the art of selling there was a pretty good article that came out this week so i'll talk about that and then as always we have our current state of fin twit and on the back half we have hot water fuck marry kill and anecdotal evidence also this is a good time to mention we have a youtube now so if you feel like seeing our faces i know we say this every time feel free to head on over and watch i mean i guess some some people like to watch podcasts people do which makes no sense to me but i mean if you guys like it feel free to head on over yep and there'll be extra clips like

short stuff. You're not going to want to watch a full episode. Highlights from the episodes. Yeah. Okay, let's go. Welcome to Chit Chat Money. On this show, host Ryan Henderson and Brett Schaefer interview industry experts and riff on the world of investing. As a quick reminder, Chit Chat Money is a CCM Media Group podcast. Ryan and Brett are not financial advisors. Anything discussed on Chitchat Money by Ryan or Brett or any other podcast guest is not formal advice or a recommendation. Now please enjoy this episode. Welcome in. I'm going to kick things off with my story for the week, the art of selling. This week, Ian Cassell, is it Ian Cassell?

Cassell. Cassell. So he published an article titled, Portfolio Turnover is the Price of Progress. I found this because you retweeted it. It was a really good article, and it was really interesting. The basic premise of it was that he was surprised how high his portfolio turnover really was when he calculated it and that maybe it's not actually that bad of a thing to have high portfolio turnover. Depending on your strategy. Right, and I pulled a few quotes from the article that I thought were fascinating.

He writes, With the rise of private equity and venture capital, everyone is trying to invest in public markets with the same permanent capital mantra. The lower the turnover, the more cerebral and thoughtful you appear to be with the initial investment decisions. Nothing looks better than being right from the very beginning. He goes on to pretty much say, at the end of the day, the only thing that really matters is performance. Do you feel like people are sort of over-glorifying the whole buy and hold strategy? It's very popular right now. Well, I don't want to just try to zig while the whole market's zagging just for the whole sole reason that they are zagging with everyone just like buy and hold, never sell, blah, blah, blah, all that stuff.

But it is quite popular at the moment. I think people underestimate the selling process and actually how much thought you need to put into that because people are very, well, historically pretty bad at selling. And it's something you got to work on if you're going to have any sort of active strategy. yeah it feels like it should be more of buy and hold as long as management executes yeah what is it it's called buy and due diligence right isn't that what he described something like that yeah i think so he called it maintenance okay maintenance due diligence um but i it does feel like a lot of people are just buy and forget and never look back yeah you gotta buy an update like i mean every quarter at the minimum you know there's gonna be a 10q i mean annuals even that's

fine too, but you got to keep that up to it. And especially, I don't know, especially if it's a high growth name or a micro cap name, which is what Ian invests in. There's a lot of things you got to look at. Maybe if you're investing in Google, not much upkeep, but you're taking a lot less risk investing in that compared to something with a market cap below $300 million. He also writes that there's three reasons he would sell. One, if the story changes for the worse. Two, when he finds something better and three if a company gets very overvalued how much of not selling do you think ever comes down to ego like the unwillingness to be wrong like they don't they're so afraid to be like oh shoot i was totally wrong and typically it has to do with

price right if the price even if the price is if the price drops they're like afraid to be like all right i was totally wrong if the price is doing well i mean what's the quote nothing changes sentiment like price yeah i mean it's tough to say i think personally when i'm deciding to sell something i do have to try to counteract the ego of like all right i put in all this work um you're anchoring to some prices things like that um there are some emotional and psychological things at play for these three things though um story you have a better opportunity or overvalued what one's the hardest to sell for i think the hardest one to overcome is valuation the the hardest for people to recognize and because it's always easy to justify valuation yeah true and it's always easy

to say you know they'll just buy and hold buy and hold and as long as i have a long enough time horizon valuation doesn't matter well you know it does like yeah price does matter and if you can get a better return somewhere else you should um and so that just makes it tough i'm curious what you think is more important the initial due diligence or the maintenance due diligence that the due diligence you're doing as you have the stock in your portfolio or the one pre-purchase decision i think maintenance can give you a better advantage because it one allows you over it probably takes maybe at least a year to become an expert on a company um what i would probably classify as an expert and that gives you an advantage over other investors because i think

every investor does initial due diligence but a lot don't do maintenance due diligence at least very well and i can give you an advantage because if you know the company well enough you know when it's time to either double your position or sell out of everything probably before a lot of the other people and that's that's important you're not you know necessarily competing against everyone but you have to know when the story changes for the better or the worse yeah it is true and once you if you really really know a business like you know it down to the nitty-gritty the accounting and everything you've read through the 10k you can tell when something happens that you don't like yeah there's times when i've held companies where i'm like that seems

good that seems fine but there's also when you really really know a business you're like i don't like that and you're able to basically recognize that and diagnose it earlier than most people yep agreed okay um that's it for pretty much my story what about you okay there was a leak uh probably from the company itself that roblox is going public in early 2021 they feel like a direct listing stock uh but there's no s1 yet so we don't have any of the numbers but i thought it'd be interesting to talk about because they are the most popular social platform for i think all it's either all children or just boys under the age of 13 so what is roblox um i think a lot of people listening don't know what it is it is according to their website they have a mission to bring the

world together through play very broad very vague um you know classic silicon valley type company they say we enable anyone to imagine create and have fun with friends as they explore millions of immersive 3d experiences all built by a global community of developers does that make sense to you no so what like is it basically like a mix of fortnite and minecraft uh i think it's its own thing so they make it really easy for kids to build games or adults you know to build a game with their tools and then on roblox kids build the games people yeah so they have two million developers that build games using roblox as tools and they have millions like a hundred times as many people that play the game so it's kind of like they enable the games to be built which are

that hadn't played on roblox which is why they're such a large um they're huge like so it's like a really really they've oversimplified the sort of game engine so that even the users themselves can create it what's that saying where it's like you don't become a platform until the people on your platform make more money than you or something like that yeah kind of i think roblox is a big example of that it's also similar to facebook or airbnb where they're not actually making the product all they do is enable people to make the product for them uh which has been shown in the past to be a phenomenal business model when dealing with the internet like i said though they have two million developers that create through the roblox studio so you know

people create the games with their tools that people can play sounds like a really really strong business model um very creative i don't know the exact numbers of their margins but i mean i like that a lot i'm yeah i i did not know that's how it worked i'm getting bullish over here but i'm also starting to think they're gonna put the like games as a service or platform in their s1 so much that the market gives them a 40 times i know sales i know i hope the market crashes before then so they don't have an absorbent valuation but they have an absurd amount of people that uh play per month three billion engagement hours each month and you can access content on any device so it's kind of like i don't know it's almost cloud or whatever it's it's it's weird it's not like any

other type of game um but not to sound overly bullish here but doesn't this have just an absurd runway for growth like almost an infinite runway for growth sort of like someone like facebook or google yeah i mean once you have your users using it to develop like yeah it's it is the facebook model where they're you know i use twitter or there's companies that use twitter or facebook to grow i mean they are growing on the platform so the users are growing on roblox because they're building stuff out for new users and they're building out a business yeah that's interesting yeah can they monetize it can the users yeah they're building i think they've i think there's been 250 million dollars uh and paid out to the the developers so far i don't know if that's the

exact number but something around there that's crazy and another note is they have an internal game engine so they don't use unreal or unity which is a little concerning because i did think that they were like the two big ones um that were kind of taking over everything uh so we did talk about unity on that deep dive kind of a little i don't know compared to their valuation but that's another i think we were wrong on that unity and unreal do sort of have the like the bulk of the market but i'm pretty sure ea has their own with frostbite and i mean i think there's a lot more sort of engines that are built in-house yeah they may have uh we may have oversold that a tiny bit but hey that's all right um all right so another interesting part about roblox probably the last

thing is that they're more social for kids and they try to strive for family-friendly content and kids under 13 spend more time on roblox than they do on youtube and i think that's just boys but still that's a huge opportunity and it's probably surprising a lot of people may be concerning for youtube but there's a lot of time to be spent among kids um founders still there which is a good note and he says their goal is to build a platform that enables people to play and build things digitally how interested are you in the s1 on a scale of one to ten oh big time yeah that's a 10 10 for sure um it's gonna probably trade it a 40 times sales ratio but it's like going through my head right now all the possibilities because there's like this would

really appeal to the secondary or like the second derivative of gaming which is esports or streaming yeah and so like i imagine people really want to watch that so they can sort of model it and build off of what they're seeing on that and i'm just like trying to play it all out in my head i'm getting very bullish yeah it's probably the most excited i've been up for an s1 in a long time very long time them and airbnb um and pro core the underrated one right that's your yeah yeah of course but they've been stalling for a while okay too long current state of fin twit um do you want me to go first i've just got basically one yeah go ahead so apparently the market loves the fact that trump did not die from covid yeah um it's a tough thing to trade i know a few close calls

like that we could be up another 10 i know it's kind of like the trade deal but it's a serious thing i want it yeah i mean i think twitter made the right decision with the whole like if you're hoping people die we're taking those tweets down and yeah it'll be applied to everyone but yeah Right. And but the market responded because he like faked us like it seems weird. And then here's the other thing is there's no statistical correlation between what presidential party there, what party the president is and how the market does. I actually pulled some stuff up. So I wanted to clear this up because people tend to get this wrong. and for some reason people tend to think republicans tax cuts corporate tax cuts higher earnings correlates or whatever they have that right in mind yeah okay from 1926 to 2019 a

republican has been in office for 46 years a democrat has been in office for 48 years in that time when republicans are in office there's a compound there is an annual performance rate of s&p 500 at 9.1 percent for democrats is 14.9 percent almost five percent outperformance and in reality and so like it honestly doesn't matter it's just like fluke data though yeah because like the greatest performer of all time was from 19 it was some republican from 1923 to 1929 right was it coolidge or something and i mean it's it doesn't matter yeah i don't know how to put that across like it's the biggest fallacy for people investing into the market i mean sometimes it may be a good thing no matter what to if there's a sell-off maybe it's a good

opportunity to buy because it's usually nonsense but i don't know i don't know why the markets haven't learned this at what point because every four years people are like i wonder how they're going to react to a new president it's like it's never mattered the corporation matter this time yeah corporations are going to keep trying to make money um i'm sure amazon doesn't really care they're gonna keep trying to dodge taxes no matter who's in office yeah just anyway that baffled me and so i wanted to get i wanted to clear that up for anyone investing and that's a big that's a big uh thing when people talk about like if someone's kind of a novice um they're trying to talk about like yeah the election you know who knows what the market's going to react it's like that just

that's a big sign to me if that someone's um not legit if they talk about that all right what's yours uh what'd you have okay so there was all right jesse livermore who is a pseudonym um very smart guy though he writes for ashanti asset management um he doesn't work there but i think they just allow him to publish things and he publishes stuff that's way over my head but he had this nice note that uh in 1991 the japanese bubble had their real estate land value worth 20 trillion dollars so that was more than 20 of the entire world's wealth and japanese land under the emperor's palace about three quarters of a mile square mile excuse me was estimated to be worth the same as the entire land in california what a bubble how i guess that makes me think like

whenever i'm thinking about a market like oh this is a bubble how apparent a bubble really should be it's more speculation like a bubble is when things get so out of hand that people like it's like they it's like their lives depend on it that they're um that the thing keeps going on but what was even more interesting was that uh ben carlson from animal spirits and ridholds tweeted about how you know the now show to pan stuff doesn't really make sense because that was the biggest bubble of all time wall street cynic who is actually jim chanos i know they're all these people that are private on twitter but just because they're uh you know hedge fund managers and stuff they got to stay anonymous he said that 20 trillion dollar figure was a little over five

times japan's 1991 gdp level right now residential real estate in china is valued at over four times their 2020 gdp and that's before you include commercial raw land etc when jim chino's tweets about something like that i get a little concerned like all right maybe i should not get anywhere close to chinese real estate yeah it makes me it makes me really want to hone in on like a market niche that i actually understand yeah it makes me very cautious uh for those asian stocks right now um okay that's uh one more sorry one more um another this is a little more another one complicated from jesse livermore but it just shows that uh there's a nice thread here that stock returns basically the last um i think three years have almost been from all valuation

um re-rating for u.s growth stocks so i think gosh what were the returns like 22 percent for u.s growth stocks only one percent of that was from actual growth in income 22 percent of that was valuation re-rating which is almost as bad as japan growth in 1990 it's a lot more complicated than that but another concerning thing yeah i mean all you got to do is look at the like aggregate multiples on some of the benchmarks you know yeah like nasdaq sales multiples stuff like that it just i mean it's definitely concerning it's concerning yeah and you have to have super high conviction if you're buying some of these i know and people tend to be like well you know growth rates are higher so it deserves a higher multiple it's like growth rates

come down they aren't like they don't stay at 100 forever and and we're actually brady our producer is currently working on a spreadsheet um of like the top seven some of the top 75 companies we came up with a list of 75 and we're going to do for the school no just generally we want to work on it it's it's the first 20 years how does revenue growth what happens to revenue growth and it should be basically this declining line no matter how good the companies are. And you just have to have ultra-high conviction if you're buying them at these multiples that they're going to be able to sustain a ridiculous growth rate. Yeah, and the multiples don't matter until they do.

Yeah, and they come down fast. Okay, that's going to do it for Current State of Fin to it. We have our interview up next with Kermit Capital. What specifically did you like? The Alteryx discussion and the Slack discussion. I mean, those are two companies he knows inside and out. He's a data analyst. He's not a professional investor, but he has a lot of experience,

and he has a lot of experience working as a data analyst, which gave him some nice insights on Alteryx, why someone would use it. Yeah, I mean, I just thought that was great, very insightful. The other part that I really liked, he's followed by Slack CEO Stuart Butterfield. Funny response when we asked him, we're like, you know, does it cloud judgment to be close with executives he gives a funny response so feel free to listen to that here you go today we are welcomed by kermit capital at least uh for anyone on fin twit you probably know him as kermit capital um he is a data analyst and i'm not mistaken

is that right yeah that's right um so before we get into what you do kermit welcome to the show thanks for having me and like i was saying before we started recording big fan of chit chat money and i would definitely credit you all uh with getting me bullish on square when you first talked about that last year and it was kind of dead money so i'm i'm very thankful for that fundamental analysis we're glad we're glad about that yeah long cash app right so why don't you describe a little bit about your background what you feel if you have one is your specialization in investing? Is there like an area or an industry that you think you have a knack for? Yeah. Yeah. So like you said, I'm a data analyst at a private SaaS company in

the commercial real estate space. My background is I have a degree in industrial and systems engineering. And I kind of stumbled into active investing just because of stock-based compensation at the two companies I worked at prior to the one I'm at now, which was Amazon and Grubhub. So like a humongous portion of my compensation was in stock and I was kind of living and dying over the stock price because I wasn't really diversified or knew anything about investing and you know, just kind of keeping tabs on the stocks because I wasn't really like paying attention to anything else but to get to your point on like what sort of my circle of competence is generally I would say like e-commerce and logistics consumer facing like tech enabled

companies and I'd say SaaS and most of my conviction in those industries is just from like first-hand knowledge of like either working at those kinds of companies or using those types of products or services. And I try to, to the best of my ability, buy what I own or buy what I use with some exceptions. Right, right. And it looks like you have about 20 holdings in your portfolio. I may be wrong. That's what you post on Twitter, I think. Does that fluctuate at all? And do you have any of your money in passive investments, anything else besides those ones that you do, I guess, through Twitter? Yeah. So it's been condensed over the last year or so. and I think it's going to condense further. I think it's important like as investors to

acknowledge that we're, our portfolios, or at least mine is a work in progress and it will be for like the foreseeable future. You know, like our strategies change, our philosophies change. You know, I would totally freely admit early on, I was more of a gambler or like, you know, a trader, you know, without realizing it. Exactly. Exactly. So I'm trying to pivot more towards like, like i was saying earlier like buying things that i understand like i understand the value prop that kind of thing um and so so yeah and then regarding passive investments um you know i put in the max annual allotment to my 401k every year um and i i have a lot uh allocated in that and That's pretty standard Vanguard stuff.

So VTSAX, VTIAX, Vanguard, Total Stock Market, and International. And I have luckily enough in that that I have like a personal, I don't know what you call it, consultant or whatever through Vanguard. You have to have like a meet some minimum. And that's been interesting to talk to them because it's like talking to people who are like all passive. like right like if you talk to them they're like sell every stock you have put it all in like index funds and etfs and stuff and i'm just like no i'm not gonna do that you know it's not nearly as fun either um yeah that makes sense is that yeah and then you just have what about 20 um for your personal holdings does that i mean you said you wanted to come down probably or do you have a

range you want to get to like 8 to 15 something like that yeah um i talked to uh like friends of mine who've like done a little bit more reading on this and apparently i guess like the optimum like the risk reward ratio is somewhere around 15 to 17 like if you have less than that that's sort of like you're you're putting your eggs away too much like in one basket or whatever um but uh but yeah i think right now my feeling is i'm in a few biotech names that i thought that i understood but then talking to some people who really know it i'm just like you know what uh this feels more like a gamble than an actual investment so i might but then of course watch it like as soon as i sell it it's up like 30x you know in the next two three years so that's sort of what i'm weighing right

now okay okay and then uh you know for your core holdings the stuff that makes up the majority of your portfolio when does you know valuation come into the equation are you a big trimming guy or and kind of the Motley Fool style of, what do they call that? Add to your winners. Add to your winners. Yeah, I'm definitely more along the lines of the Motley Fool philosophy,

although I have branched out over the last few years. But to answer your question about valuation, I'm not very interested in analysis paralysis when it comes to finding the right entry point or finding the right buy points. and in terms of like price to sales or you know that kind of thing but I will look at that stuff and I think a good resource for that is Bessemer Venture Partners cloud index if you go to their home page they list like all the big SaaS names and they sort of like have a table that that shows

like price to sales or forward like next 12 months EV to sales efficiency scores which is like the rule of 40 basically calculation for each company and so i do kind of pay attention to like a relative valuation but like in a strict like isolated silo this is how this company is doing i don't know how help that helpful that is nowadays you know yeah in this world it's like super overvalued yeah what uh what would drive a decision to sell for you is it mostly in the business operations is it your thesis was wrong entirely or is it ever a time where it's like it makes up too much of this portfolio like you said 25 of your portfolio now you got to trim a little bit portfolio management as well yeah and then maybe i mean does valuation ever

drive a sell decision for you it never drives a sell decision for me at least for now um Um, uh, that's how I felt like, um, uh, but to, to sort of like answer your question around selling in general, like, I think we talked a little bit about like, um, like under realizing that I don't fundamentally understand the business is one, like one way that I might consider selling. Another one for me is like, in general, like, um, I try to initiate a position and then learn more about the business over time. And if I gain more conviction or my conviction sort of maintains throughout like a few quarters and stuff, I'll like add and add.

But if my conviction sort of doesn't change or like this isn't a business that I could see myself owning for like 10 years or more, then I might get out of that initial like first purchase in favor of consolidating. Yeah. And then the busted thesis overall. um but that's that's a skill that um you know is is easier like said than than done like being able to filter out that noise and really understanding if your thesis is busted is is a non-trivial task i think have you have you found that the starter positions help you at all like does it help you track them does it help you do more research on the companies at all yes i think so for me personally it does um although sometimes i i get like right now for example beyond meat is a starter position for me um and the story is one that i generally like um you know but um i'm kind of in

that middle phase where i'm not sure if this is one that i want to keep adding to especially relative to the other things that i own um you know what i want to put new money towards this i'm not sure and if i'm not willing to do that should i really be in this position in the first place. No, that makes sense. I think we've all been in that situation where it's like, all right, yeah, I'll create a startup position or something like that. And then you're like, I don't know nearly enough about the business. And so it's just ends up being a discard, which I guess at that point, it's better that it's not a large makeup of your portfolio. And then Amazon, I think you already touched on this. It's still your largest holding. Are there any concerns for you? I know

it probably ended up being a great like a great thing to be paid in stock based compensation there um were we talking about that before the show uh no that was during that was during that but yeah um are there any concerns with that making up so much of your portfolio now um on a business fundamentals uh perspective from that perspective not really you know uh i mean if you look at the overall business this is this thing i mean i know this is like not an opinion you should like share whatever like you shouldn't fall in love with your stocks or your companies you know you don't know the future's unknowable but this feels pretty bulletproof you know especially in this environment um when you consider aws and how it's printing money

you know and the advertising business became the third biggest advertising business in the world you know out of you know relatively out of nowhere you know a couple years ago um and then the retail business which i know the best because i worked in operations uh there and knowing like when I left there four or five years ago and having the perspective of interviewing at other logistics companies like UPS or, um, like Peapod, which does like grocery delivery. Um, back then, even back then I was like, Amazon is light years ahead of everyone. Uh, yeah, I was like, this is not, uh, this is not a fair fight here.

So, uh, and my conviction in that has only, um, increased, uh, And I could give you like one example for Amazon if you all want or if you want to move on. Go ahead. So I left right before Kiva, which is which is now known as Amazon Robotics, was just starting to get getting integrated in the fulfillment centers. So Amazon fulfillment centers are like a big giant warehouse where they, you know, bring in inventory, put it on the shelf, which is now makes it available to buy on the website. and then everything outbound which is like post buy button out the door to ups or assortation center and everything like that and these buildings are huge so the building i worked at was 1.25 million square feet it was three stories it was like an enormous building you couldn't you

could not see from the parking lot the other end of the building if you were on one end of the building it's like enormous and the biggest labor cost associated with that was the stowing and picking um departments so these are the departments where people are um you know putting items on the shelf and taking or taking them off putting them in a tote and getting them uh fulfilled um so we're talking about at any given time like 400 to a thousand people doing these jobs and these jobs back then you were walking like 10 miles a day every day uh so and they were located in like suburban areas of rural towns like you know so how many people can sustain walking 10 miles a day for 10 12 bucks an hour you know uh all day and all night all year long they're like eventually

like the turnover was starting to catch up on itself you know yeah exactly there's just not enough people who are willing to do that, you know, like indefinitely. But what Kiva did was it turned a job that required 10 miles of walking a day to a job that's just standing and picking stuff off of a shelf and putting it in a tote. You know, so it dramatically like increased the potential pool of people who could do that kind of work. And it also dramatically reduced the number of people that are needed in the first place to do that job um so i mean and before so when i knew that and i kind of saw like how unsafe like working at a ups distribution facility is in comparison um uh you know in some of the other places i checked out it was uh i got a lot of

conviction out of that you know right now there's a bunch of other reasons too have you added to amazon position at all no i haven't um and uh not to say i wouldn't um but i think that uh my money would be better served else elsewhere uh like new money but i am very bullish about amazon over the long term okay and then you also paid a lot of attention to glass door ratings which i i like that um why do you do that and then how much does that actually weigh on your thesis when you buy a stock like does it ever deter you completely if there's like bad glass door ratings it's a it's a turn off um uh it's not the only it's one data point among many i think my time at grubhub um you know i don't know if y'all are familiar with the innovators dilemma by clayton christensen

yeah but it's it's basically it talks about companies getting disrupted um and uh it's one of the things that are talked about. In my time at Grubhub, I found that like the culture ultimately was what was getting us disrupted by companies like DoorDash and Uber Eats. And so like I feel like I have the ability to read the tea leaves on something like Glassdoor reviews and sort of identify those telltale signs of like a company where innovation is just not, it's just really hard. There's a lot of friction to getting new products or services or like improvements pushed out the door. And so I view Glassdoor as, you know, there's the quantitative like data, like what is the rating? What is it trending? How do they view the CEO as it's just one data point,

but it's not really that valuable if you're not like drilling deeper into the actual reviews and seeing what people are actually saying and sort of sifting through like the people who have had sour grapes and identifying like is this a place where like actual talented people can't get anything done uh and and if if i get that sense then you know i'm not really it's gonna make it's gonna turn me off and that's how i kind of feel about teledoc uh for example i know it's a hot one and people love it but i don't know it's yeah i mean that's the whole conscious capitalism principle is you know you're generating not only shareholder value but hopefully stakeholder value across the board and those employees are the ones that in turn generate shareholder value so

there's definitely merit to having a place like glass door and being able to figure out what do the employees think because if they aren't happy and obviously there's going to be certain and like people have bad experiences at any company but if you're starting to see it as a recurring theme that can be a huge issue yeah um yeah and i mean just one question for you and that point like if you're applying for jobs and one of them if you're getting an offer from teledoc you know i don't know about you but i'm checking the glass door rating and if i'm getting in if i'm getting a review from another competing company you know with maybe a similar offer and a much better glass door rating i'm probably more likely to take that other offer so that's so

not not only existing employee employees but prospective ones as well yeah it's an indicator that they might not be able to get the best talent in the future which that's not going to help them drive any competitive advantages. Now, we do want to talk a lot about data because you are a data analyst. And so we'll dive into that a little bit. Something that we haven't paid a lot of attention to, but we think is a valuable tool. And the way we came across this was your Twitter, oftentimes you'll tweet out like different charts and it makes it really easy to see. And that, I guess the term for that is data visualization. I'm curious, what sort of, well, first of all, what value do you think data visualization provides? And then what sort of edge do you

think being a data analyst gives you in investing? Yeah, I think this is a great question. And I've worked at like several companies now, like publicly traded companies and private companies as a data analyst. In my experience, I can't speak for other people, is being a data analyst is almost like being like a congressional aid or like like and like being like uh an assistant to someone who has to like get down and dirty in political bureaucratic like situations and help people make a case like building a case for something that may or may not be in other people's best interests usually like thinking about stuff like in a meeting um you know like a cross functional meeting with different departments you know uh where we need to like institute a new

process like uh to improve customer experience or like lower costs or you know that kind of thing and so being able to like visualize a problem uh and or potential solutions impact in the most like bite-sized way that can like capture everyone's attention and at the same time be like as undeniable as possible because so much so much of what you're doing is like defending your data or defending your thesis of what's happening in the business to people who are not receptive to you just from this from like zero you know from like the beginning so yeah so I would say the importance of data visualization is like making things digestible painting a picture for people who may or may not be technical or may or may not be like receptive to your argument

and then what sort of advantage do you do you get as a data analyst it's it's around like being the subject matter expert and oftentimes really murky waters like data is usually messy as hell especially when you're joining across like several data databases that aren't designed to talk to each other um you know being able to uh really get down in the weeds and answer people's off-the-cuff questions that are like usually critical about where your data is coming from um is is uh you know being a subject matter expert uh in that kind of stuff and being able to answer people's questions uh gives you a little bit of political capital too in these larger organizations have you ever had a scenario where um like those cross-functional meetings that you just discussed

have you ever had one where you try to present someone just raw data and they're like no not receptive to it and then you're like here let me paint the picture and they're like okay that makes more sense but it's the exact same thing yeah yeah yeah i'm i'm struggling to find like a particular like a specific uh example to illustrate to you but it happens all the time uh and i think that's the value that's the value of something like tableau uh which is owned by salesforce which is what i have a lot of my experience um with in data visualization um if you don't if you're not familiar it's like a web-based um you know data visualization tool um that allows you to customize like what you're you know what range of data you're talking about or filter sort the kind of

data that you're looking for on the fly um and just something as simple as like the load time to like let's check out the midwest versus the northeast you know the same question you know that kind of stuff it could kill a meeting you know if it's taking like two or three minutes for the thing to load you know what i mean they'll just we'll just move on into something else and you've already like lost your point yeah that makes sense that makes sense all right well one company that we think is similar to tableau but we really have no idea we're kind of just reading stuff online this is why we wanted to talk to you about this yep it is alterex um what value do they provide to their customers and why would a business or, you know, someone like you choose

to use them? Yeah. So I'll just add a disclaimer here. I am long Alteryx and I've also never used Alteryx myself, like as a data analyst. However, as an investor reading through their slides and their value proposition and their statistics that they post, their value proposition is what like heavily heavily resonates with me in my work experience um and like what a potential solution to like the day-to-day struggles of being a data analyst would be um so you know buyer beware like do your own due diligence you know um like maybe you need to use it to to see it like uh to like get the value prop that go for it um but i have like the um like something from slide deck right here so it says all tricks enables analysts and data scientists to discover

share and prep data prep is really important perform analysis statistical predictive prescriptive and spatial and deploy and manage analytic models so here's some of their stats today's analyst tools and processes are insufficient 62 have to depend on others within their organization to perform at least some steps in the analytic process when i talked about that value prop, like one of the benefits of being a data analyst, being able to answer other people's questions. They might not be subject matter experts. That's exactly what they're talking about. 69% are not satisfied with the quality of the final input. People questioning your data analysis, what you're providing in meetings. 81% are not satisfied with the overall speed

of the analytic process. And that's mostly talking about like cleaning up data, dirty data to make it like, uh, analyzable. Um, and then they say $60 billion per year are wasted on analysts doing repetitive manual work in spreadsheets. Absolutely. Uh, 6 billion hours per year spent working in spreadsheets, 26 hours per week, wasted working in spreadsheets, eight hours per week, wasted repeating the same data tests. That's a lot. That's a lot of time. Yeah. You can attest to that. Absolutely. That is like so much of my time was like, uh, you know, present like doing a ton to work on a on a on a like data model and then someone like a higher up like questioning it and then my boss telling me to spend a week or two like making sure that i've solved whatever question

they have even if it doesn't even make any sense so where does alter x sit in sort of the value chain let's say i'm a firm with um a bunch of raw data a bunch of different excel spreadsheets and i'm not able to get my point across do i come to alter x and say hey here's a bunch of data can you basically organize it for me or is there like a subscription one size fits all kind of thing where i can subscribe and use alter x's tools how does that work so alter x has a land and expand model um that provides like various um sort of clients that you can download on your desktop and they're working on a sas uh tool but basically what they're uh what they do and this is covered in their analytic market landscape slide deck

from their investor slide deck is they help data analysts or data knowledge workers catalog, prepare, describe and diagnose and then provide predictive and prescriptive prescriptions to your data. So it's supposed to capture like that whole life cycle

of beginning to end sort of data analysis all the way from just the very beginning of just like cataloging it all the way to doing predictions and prescriptive stuff, whereas their competitors are usually siloed to particular subsets of that landscape. Okay. Does that give them any sort of moat? Because the worry we have when investing in one of these companies is we don't understand it enough. There's a ton of them out there, and we don't know whether they're going to eat each other's market share and compress margins.

And to touch on that, there's times when it might be an adjacent competitor. Like, I don't know if Tableau and Alteryx are direct competitors. And we just hear data visualization or data analytics, and we assume, well, they're all competing. I mean, is there Alteryx independently? Do they have a moat? So to answer your question quickly on Alteryx versus Tableau, Alteryx and Tableau are both – they work together and they also work against each other. So often you'll see data analysts preparing Alteryx and then plug it into Tableau for the visualization part,

but you can do visualization in Alteryx as well. So from a moat perspective, I think Tableau has less of a moat than Alteryx does in the data analytics space, just because they don't have as much, as many products or services around data prep. Um, uh, but other, uh, aspects of the moat it's founder, it's a founder led company. Dean Stoker has been the, uh, is the founder and CEO of the company.

Uh, and what I really like about him is he's an excellent, um, speaker, uh, and he can explain the, he understands the landscape and the, and the pain points of a data analyst, uh, really well. I know from firsthand experience that he's putting his finger right on the pulse of, of what the pain of a data analyst is. and he also understands at a high level that there's a shortage of talented data analysts and data scientists in the world and so much of what Alteryx is doing is try to increase the pool of data analysts data scientists and their and their efficiency so not only is the whole value

prop of Alteryx to like make data analysts and data scientists more efficient it's also trying to just increase the total number of people who consider themselves to be data analysts or data scientists. And so in that way, I view the value proposition as similar to something like Twilio and software developers. And that yes, you can, you know, you can build all the Twilio tools from scratch if you really wanted to. But why would you want to when there's an off the shelf solution right here to help you get from zero to 60 and you could focus on what's really important at your company right that makes sense um the reason we ask a lot of that we really wanted to talk alter x is because they a lot of people discarded them after the last quarter and uh i saw some

tweet and it was like nothing changes sentiment like price and it it's funny because so many people arc invest included sold their entire alter x state all because of one quarter in this sales slowdown. Do you think the thesis is still intact despite the last quarter? Yeah, yeah, definitely. I think that when you talk about ARK Invest and other folks who are selling out of Alteryx, you know, I think they're probably thinking over the next two, three, four quarters, Alteryx might have continued headwinds based on the macro landscape of COVID. So if you've been following their, you know, earnings announcements and stuff, like they had exposure, like a non-trivial amount of exposure to travel and hospitality, you know, the industries that have been hurt hard by COVID. But at the same time, they've also landed new customers.

You know, if you, if you like listen to the kind of companies that they're, that they're landing, it's a lot of like government institutions, places that are not, you know, customers that aren't like going anywhere, you know, during or after COVID. So the way I view it is, like, right now they're trading some customers that are, you know, getting hurt right now for better long-term bets. But over the long term, like, this problem is not going anywhere of, like, cleaning up messed up data. Nobody wants to do this type of work. And once, like, people start using, like, an effective product like this, they, like, demand, you know, that their companies have it, you know, in order to, like, be more efficient. So, yeah, I think they'll have some continued headwinds, but I think the thesis is still in tech. To touch on that, you said, you know, they're not going anywhere. Companies don't want to do this. How hard is it for a startup to just be like, basically replicate what Alteryx is doing here and say like, you know, does it take lots of different trial and errors with businesses, like different use cases for them to figure out all the different, to build out to where Alteryx is now?

do you have to have like 100 developers or you know is it someone that five a five developer team can do yeah yeah you know i i can't really speak to like how difficult the product is to build to build but what i can speak to is how difficult it is to build a community um that'll advocate for your product um the way that alterx has um you know i think that companies are resistant to adopt these types of uh technologies especially especially when they're expensive. I'd say the biggest weakness, the risk I see ahead for Alteryx is just how expensive the seats are for Alteryx. But I do view their work with ADAPT. I don't know if y'all are familiar with that, but ADAPT is Advancing Data and Analytics Potential Together. It's their program

that they initiated. I think it was around when COVID started. And the whole purpose is they know that there's all these people who are losing their jobs because of the coronavirus. And so they've partnered with, I think it's Udacity, to offer a certification program for free for people who've lost their job to get certified in Alteryx to get a job in data analytics. I think that type of work ultimately is the work that's hardest to replicate in the strongest mode for them over the long term. That makes sense. All right. Last question on anything data, this is not concerning Alteryx, but do you have any underfollowed data-focused companies that any listeners should maybe, you know, get on the radar or possibly research more?

Yeah. So on my watch list is a company called Domo. I don't know a ton about this company and I haven't used them like myself, but it's valued currently, last time I checked, at $1 billion valuation. They IPO'd back in 2018 and are up 43% since IPO. So they're not tearing the roof off the place, but they are growing. They specialize in business intelligence and data visualization. So somewhat of a competitor with Alteryx. They're trading at five times EV to forward revenue, 23% revenue growth year over year, 73% gross margins, pretty good, but negative have 30% last whole month free cash flow. So I think it's worth looking at. Yeah, that does sound it's better than everything that's trading at 25 times sales right now. Exactly. That's something

to definitely watch out for on the watch list there. Now, another company that you've talked a lot about is Slack. Slack is, it's almost polarized on Twitter. Like a lot of, you know, everyone's kind of has like a hot take on the business. Among the investor community. Yeah. Right. So what is the value of Slack to a business in your opinion? And do you see it actually being able to become an ecosystem of apps as opposed to just simply messaging slash workflow tool? Yeah. Yeah. So off the, off the top, like, you know, going back to like investing theses or like principles, like, you know, I talked about investing in what I own or what I use. Like there's no product or service that I use more like frequently besides Twitter,

which i don't invest in uh then slack like i use slack in my like literally all day long at work and then i use it after work in this coding boot camp that i that i am in um and then i also use it in like an investing group that i'm in um and and i also used it in like other contexts before and i've used it at like the last two companies that i've worked at as well um so you know it would be weird for me to not own it um like after doing my due diligence and also knowing that the revenue is growing 50% and yada yada. But to answer your question about the value of Slack to a business. So Slack is one of the few software tools that is used by everyone at a company. So you can also think about Zoom. You can also think about like Gmail or like Outlook or whatever. It's

one of those few things that everybody across all departments use. So it's a horizontal layer that cuts through all departments within a company, and it enables collaboration between departments with integrations that are used heavily in siloed departments. So if you think about Atlassian's software tools, like Jira, it's, you know, it's going to be used mostly by product and dev folks, but there's some information that's valuable to people in other departments, like, hey, has this product released? Can we start marketing it? Has this bug been fixed so support can know and get back to a client um so those people can get can get updates on atlassian without having atlassian licenses because there's integrations in slack that'll tell you this is our

this is ready to go um this thing that we need to know about uh same thing with hubspot or zendesk um you know it gives uh like a view into other sass companies even like datadog too right yeah i don't know i haven't done as much due diligence on on datadog um but uh you know they have a ton of integrations so uh as far as your question about like ecosystem of apps they already have 23 000 apps in the app directory 700 000 custom apps and integrations that are used weekly and 820 000 active developers and for context microsoft teams based on my research just going on like their app store only has 666 apps um so like will they catch up sure but i think that there's something to be said about a 15 billion dollar company having this much like um much of

a robust app ecosystem compared to microsoft well yeah and then we're going to ask about teams does that give them a competitive advantage and do you see any other competitive advantages they have over teams yeah so like a common theme you'll hear in investing in sas companies is sort of being vendor neutral you know or being agnostic and slack has this over teams so where teams you know has azure and the azure ecosystem and you know uh like products that'll compete with your data dogs and you know what name your sas company um slack is neutral to to that positioning so they don't care really what um you're integrating with on slack they even have a partnership directly with microsoft teams um so they are like allowing you know anyone to integrate to them

where microsoft might not be able to say that uh as well um so some other thoughts about teams is you know in my opinion and i think it's more than just my opinion the whole concept behind teams was a defensive product so like ben thompson from strategy if you guys know who he is yeah he's like a blogger yeah so he said for microsoft getting customers to switch was never the goal uh like instagram adding stories to remove the impetus for new years users to even try snapchat teams is a way to prevent microsoft customers from even trying slack from ever trying slack And then Stuart Butterfield, he tweeted in July, Teams has architectural limitations that prevent it from scaling to even 1% of the size of our largest instances. So our enterprise customers couldn't even switch if they wanted to.

I'm a little bit skeptical of that, just because if you think of Azure and how many customers they have on that and how fast they're growing, surely they can scale. but i think it's it's an interesting thing to think about now do you think the space at all that they've kind of built out themselves i think they're building their own market it was it's really one of those zero to one things um classic uh peter teal type innovation there but is it zero sum at all or can they both win and can someone else come in that you know like google or amazon and you know all of them succeed as well yeah the way i think about the market is like i think that they can be winners in this space i don't think it's zero sum and i think that there's some like companies there's some organizations that it makes sense to be on microsoft teams for

um like something like a government agency or a defense contractor maybe you don't have the needs of like uh you know being integrated to to jira and service now and all these other like um you know sas or or uh platform as a service infrastructure as a service companies when you're you're doing more like um more of that type of work um and you might have like security needs that are just like not uh able to be like met by slack for whatever reason um but in my opinion like slack's value are with companies that deploy uh software applications and need to have like a constant like agile um sort of work environment where they need to communicate uh in real time about what's what's going on and and are constantly pushing new

products and services um and so where would i rather have my money personally like in the 15 billion dollar company that's like you know their customers are are going to potentially be other 15 30 100 billion dollar companies i'm going to grow the c count and it's it's a bullish signal to me when you see all big tech chasing what they're doing yep like you know and and we saw it with i guess snapchat might not have had a great roi but like oh spotify yeah spotify for example you know when people start copying the business model that kind of thing it feels like something to pay a little more attention to um another note that i saw here is that stewart butterfield the ceo of slack follows you on twitter and we've had this debate here is if we

had the largest let's say like our largest holding was spotify or something like that would we if we were presented with the opportunity to meet and get to know daniel ek or something like that would we do it because we think on our end maybe at clouds or judgment do you ever feel that do you think that uh investors can get to know management personally without impacting their investing style yeah yeah absolutely i think it definitely clouds my judgment um like how would i feel would i feel awkward like tweeting out that i sold out of slack maybe a little stewart not you know stewart sees that you know um but uh but i think that that trade-off is worth it you know i mean like you know uh i also have three other ceos that follow me and i invest in

those companies as well. Um, Okta, PagerDuty, um, and, uh, 2U. Uh, and so it's a similar, it's a similar thing there. Um, but like to, to talk about Okta, for example, Todd McKinnon on Twitter, like he, he shares some like great nuggets on, on Twitter about his company and his leadership style. And for me, I put a premium on, um, like strong leadership at a company. Um, I think it's like a cheat code in investing, you know, like maybe people feel differently, but when you know that your ceo is like a great leader like a phenomenal leader um that's that makes that builds on my conviction um so totally uh a risk but um i do think that twitter is is a game changer for retail investors giving us like visibility that we never had before so i'll take

that trade off yeah it's also interesting to see all the corporate accounts what they're liking who they follow things like that um that i that's an under the radar thing that i don't think a lot of people are looking at where you can kind of get some future insights. All right. Wrap up questions. Yeah. These are our two final questions. Everyone probably knows about them. Kermit, you probably know as well. First one, what's one financial saying that you disagree with? Yeah. And I don't know if this is like an official quote or not, but I definitely see this around and it makes sense. But don't fall in love or get emotional about your investments is one that I slightly disagree with so i mean i generally agree with this uh in terms of like not flying

off the seat of you know uh whatever like when you're making a decision like you want to do your due diligence before you invest in a company um and you don't want to like be overly emotional but like my goal is to hold companies that i have high conviction in with high concentration for a long time like 10 plus years um longer if it makes sense and like in order for me to sustain that level of conviction like i need to be interested in the business um and i need to like be willing to like follow the story um and and i need to believe more in in the company than just the tam and the moat like i want to genuinely root for the leadership team to succeed i want to genuinely like uh root for the employees to succeed and if i don't like have that connection

you know it's it's going to be just harder for me to sustain that um conviction and that hold over time. And like, I think Square is a perfect example of that, what they're doing in the payday loan space, you know, what they're doing in the banking space. Those are all things that I can really get behind and makes it so much easier to hold it for the long term. And I think that's important. Yeah. And that sort of passion drives like a higher inclination to continue researching as well. I think it keeps you interested in the business. Last question then, what's one piece of advice you have for any investors yeah and i touched on this before but you know some friends who aren't as into investing have asked me specifically for some stock picks i'm sure that

that's probably happened to y'all too um but my advice to those people is like to to own what you know or own value props that you can understand or just tangible to you so some examples would be like you know if I'd rather like suggest looking into Roku as an investment over the trade desk for someone who's not who's newer to investing right if they have Roku they can see it they can use it I can like point to the value proposition for e-commerce these are both another two great companies Etsy over Shopify you know there's much more likely of a chance that they like have ordered uh from etsy and see it you know and shopify is a little bit more abstract and then slack versus something like you know fastly which is just going to be a harder thing for them to

understand conceptually and less likely for them to hold over the long term so i would definitely um you know have a bias toward owning what you know or use okay that's gonna do it kermit thank you for your time uh yeah i had a fun conversation it was a pleasure thanks guys really appreciate keep up the good work all right welcome back in thanks again to kermit capital for joining us next we have hot water i have three three i do too okay well whose turn is it i think it's my turn yeah you should go first okay uh hot water whale wisdom you know that site where you want all the 13 f's love that yeah it's good name but there's a new site that i think has no chance of any well. So it's called eToro. And there's a guy in there named Jay Smith, 32 year old living in

southern England, who is an investor on there. His online name is Jay Nemesis. And 21,000 people on this site called eToro copy his trades with their own capital, $40 million. So if he buys FedEx, they do too. If he shorts the NASDAQ, they short it too. I've never used eToro, but there's no way this ends well who is this guy jay nemesis he's the new whale is he on whale wisdom has yeah there's a good there's a good tweet from this guy named david showell um i don't know what he is but he's gonna follow on twitter it was like quote so how'd you lose so much money uh answer a very sophisticated trader online jay nemesis he was on a roll said it was a sure bet wait what what do you mean like like it's i don't know it doesn't make any sense uh there's no way that

Ends well, everyone just copying each other's trades. Don't borrow conviction. No, as Matt Cochran did say, and we shall not forget. All right, Martin Shkreli is back. This isn't really a hot water, but I just want to talk about it. He's blogging from prison, like, every week. Yeah, I just subscribed to his newsletter. Substack?

No, it's a free one from GoDaddy. uh yeah he's talking about how um biotech stuff to his prison inmates and things like that sounds like it could be a fantastic sitcom i can't wait to actually read all the stuff it's gonna be it's gonna be interesting for sure he's actually kind of a genius but yeah that's so he's also sounds like a total sociopath all right um there's another cool thing hot water i guess would be being a bandwagon fintwit investor um which we are you know sometimes everyone gets that at some point so this guy created a blog called the in i don't know the name but it's called the fin twit index basically fin twitter portfolio index start just started out it's plus uh it's beating

the s&p by 3.26 percent during the fourth quarter can you guess what the five any of the five largest holdings yeah i can guess all of them because that's our fuck mary kill this week is the top three okay so um but i know the top three it's what fastly roku levango i'm guessing c limited and c's a little lower but crowd strike square damn it's concerning that it's square feels so consensus well squares run up so much which is so disappointing because we we had to sell whatever but you know yeah uh okay is that all three that's all three for me all right there's a i have a serious one to kick things off which is ebay i got tagged in some article um from cnn and i'm not going to get into like all of it but basically there was this blog

like e-commerce bite or something i think is what it was called um and it talked poorly about ebay and a bunch of the employees there and the ex-ceo tried to scare her out of blogging they sent this lady a bloody pig mask threatening messages live spiders posted her address on craigslist for hookers and swingers to come by um sounded absolutely terrible i recommend everyone go read i think they're out now i think those employees were fired and the executives had to leave they got some great severance package which is bullshit but yeah um yeah i just i got tagged in that i wanted to share it it was bad it was really bad i'm glad i'm not investing in ebay yeah and then the playboy spack is official we have to talk about this it's

their mission statement is to and i quote create a culture where all people can pursue pleasure their two primary revenue drivers are categorized as sexual wellness and style and apparel i wonder how they do depreciation on the playboy mansion they write that down they i think there was one like one of their products was part of their revenue was categorized under like cbd sexual stimulus or something like that i could see them doing a big cbd crossover apparently apparently the board of the company that's taking uh playboy public through a spack is all male makes yeah that's i mean shocker there it's not a shocker but it's just like yeah would you ever buy this no well never say never even if there's value yeah i mean would

you find value where you can get it i mean never say never i mean it's just just because it's a smut just because a smut magazine or whatever doesn't mean you like me choosing not to invest in it it's kind of it's like cigarettes me choosing not to invest in it doesn't change their cash flow right so i mean it's not like you're i've always had this gripe with ultra as a stock like just because you buy the stock doesn't mean you're advocating for the product yeah and just because you choose not making money yeah unless you're an activist investor you can't do any of that esg stuff okay this week fox 12 published an article with the following headline alaska airlines to offer covid 19 for passengers traveling to hawaii from seattle nice that's us we gotta get on that

right that's bad yeah apparently they were trying to offer tests but i guess they just scared off everyone from flying alaska um yeah anyway i thought those were funny fuck mary kill though the theme is the top three holdings of the fin twit index which came out this week fastly roku levango fuck right kill um okay well levango i'm gonna say levango teledoc um which they're gonna be combined here shortly so i'm gonna marry them just so they know i'm the best wait is it roku and fastly yeah yeah i i'll fuck roku i like them a little bit um the stocks run up so much though that i like the business is so good but the cat's kind of out of the bag a little bit fastly i like them as well cats it seems like it's out of the bag a little bit um so i'll kill

them but i think they're all quality businesses that are all three are trading at pretty high prices yeah yeah it's hard because like you don't really want to kill any of these businesses they're all good i guess that's why they're consensus now um but like we said earlier there's not much margin of safety in a lot of these growth teams right now do you think it matters like honestly do you think when most of twitter is consensus about a company it ends up mattering i don't think it matters it's just good of retail investors probably not but it's good just as a filter of ideas see what's getting more popular and see what maybe is getting less popular i don't think it is statistically that relevant but it's also nice just as a filter in general okay anecdotal

evidence uh you want to go first sure short one so we all know there's a lot of bs coming out through SPACs right now like you just mentioned earlier the playboy thing um the only reason they're going public is so they can really you know grab the bag before you know the SPAC mania ends but in the long term do you think it's better because there's going to be more public companies available so there's going to be some diamonds in the rough yeah but you just can't touch a SPAC currently until like post like one year after they SPAC yeah is that the term spacking spacking i don't know um but because you don't know what due diligence is being done true true and so you have to sort of wait out and see the sec filings because

we've basically gotten the worst case scenario of what can happen with the spack yeah with nicola right and there could be a few more yeah just wait out you know maybe you have to wait three years but i think it'll be better in the long run what's it is there any good companies that of spacked open door open door i mean all the chamath ones seem solid they're all a little speculative but i mean virgin galactic i don't really like do they smack yeah they were the first one um like a year ago huh he can't that kind of kicked everything off interesting okay well anecdotal evidence for me i got back on instagram a while back i think the experience is slowly eroding and you might not have noticed if you're on instagram the whole time but i took

like a five month break i just wasn't really i don't know i felt like stopping being on there and i came back and it feels like the experience is much worse it's starting to feel like how we probably felt about facebook like six years ago that's good because i haven't gone out to be one of those seem high and mighty because i i wasn't ever on facebook but that's i'm good hopefully people are off instagram in like three years and i wouldn't have missed anything it feels like they just push the monetization lever to full blast really and they're starting to ruin it i don't know i don't know it was just sort of like i don't spend as much time on there anymore and maybe it's because i spend a lot of my time on twitter but i just don't find it that valuable a lot of people

say instagram doesn't make them feel very well because everyone's all performative and then everyone looks like they're a 10 and you know like and their life is like way more way better than it actually is yeah okay well that's gonna do it any on a high any on a very happy note right yeah um thank you guys for listening thank you kermit capital for coming on the show if you want to get in touch with us feel free to reach out to us on twitter for any show that you want us to do or things you want to talk about i appreciate twice now people i think we're doing lemonade for a deep dive here uh within the next two weeks or something like that and then someone tagged us in an article so it was good to get both people's responses on that and then anything

we say here on chitchat money is not formal advice or recommendation thank you guys for listening we'll see you next week Thank you.