Yet Another Value Podcast - $YOU.L: is YouGov really an AI loser? | Jonathan Cohen, Zipperline Capital

Episode Date: June 21, 2026

The market has decided YouGov ($YOU.L) is an AI loser and cut it ~50% in a year. Jonathan Cohen of Zipperline Capital thinks it's an AI winner trading at 6-7x EBITDA, with a 20-year proprietary dataset AI makes more valuable, not less. We spend the first half on the UK as an "emerging market" (corporate governance discounts, why buybacks are finally happening, and why you can never compare UK and US multiples), then go deep on YouGov: the panel, the moat, synthetic data, and why the company is cancelling its dividend to buy back stock.This episode is sponsored by my upcoming AI webinar with AlphaSense.The AI landscape has never been more crowded — or more confusing. Everyone's telling you to adopt AI, but almost nobody's asking the harder question: which tools actually give you an edge?I'm sitting down with Dave Wang of Wall Street Prompt and Ben Collins of AlphaSense to break down the modern AI stack for investors — from horizontal platforms like OpenAI and Claude to agentic workflows and finance-specific intelligence tools — and where each one actually fits in a real research process. If you're trying to build an AI-enabled workflow that sharpens your judgment rather than replacing it, you won't want to miss this.Join us on June 25th - register now: https://www.alpha-sense.com/resources/webinars/choosing-your-ai-stack-a-framework-for-institutional-investors/?utm_source=pt_YAVP&utm_medium=sponsored&utm_campaign=SWB_DG_06-25-26_IMP-GENAI_CORPFS_YAVP-AI-SolutionsChapters:00:00 Why YouGov could be the AI winner the market is misreading02:56 Why Jonathan Cohen runs a UK and Europe small/mid-cap book08:01 Why you can never compare UK and US multiples13:08 What UK analyst coverage actually tells you17:37 The shift toward UK buybacks and capital allocation22:00 The "buybacks kill liquidity" myth25:11 What YouGov really is: a proprietary data business31:19 Inside the panel: why people answer, and why retention is the moat36:52 Why the market thinks YouGov is an AI loser38:19 The bull case: why AI makes YouGov more valuable40:55 Synthetic data, and why it breaks46:28 Trust as a moat in a world of AI slop52:27 Pushback: Chegg, Wix, and the real AI losers56:51 Content businesses vs distribution businesses01:00:14 Music, media, and what compounds through disruption01:05:38 ClosingLinks:Yet Another Value Blog - https://www.yetanothervalueblog.comSee our legal disclaimer here: https://www.yetanothervalueblog.com/p/legal-and-disclaimerProduction and editing by The Podcast Consultant - https://thepodcastconsultant.com/

You're about to listen to yet another value podcast with your host, me, Andrew Walker. Today we have my friend John Cohn on from Zipelan Capital. You're going to enjoy this podcast. We start off 30 minutes just riffing on the UK market, which I've talked about quite a bit over the past 18 months on the podcast, just jokingly referring them to an emerging market. It's a market that I wish I could crack the code on, but there are a lot of cheap stocks there. There have been a lot of takeouts.

It's a really interesting market. So we talk all sorts of stuff about the market there, and John spends a lot of time there, which is why I ask him. And then we dive deep into UGov, which is stock that John owns, so you should see the disclaimer at the end of the podcast and the show notes. But we dive deep into that. It is a really interesting company because it trades quite cheap. They say they're going to start buying back stock, and they canceled the dividend to do a stock buyback. And the most interesting thing about it and we'll discuss it in the podcast is the market thinks these guys are an AI loser. And as I say, the first slide in their earnings deck that

they just said says AI is going to be. basically says, I don't have the quote right by me, says, AI is going to be great for him. And John thinks these guys are an AI winner. They think they're an AI winner. And when you've got a company that trades for probably six to seven times EBITDA, and it's really EBDA because there's no, as we joke, there's no stock in the UK. So it trades for a very cheap multiple. When you've got a company that's trading for a very cheap multiple, the market thinks they're an AI loser and they might be an AI winner. Well, that's got the potential to be a really interesting stock. So John's going to get into all that. We're going to get there in one second. But first,

a word from a sponsor. This podcast is sponsored by AlphaSense, and more specifically, my upcoming AI webinar with AlphaSense. Look, the AI landscape is crazy if you're an investor. It's crowded, it's confusing. Everyone's telling you to adopt AI, but nobody is telling you what tools to use.

How do you adopt AI? Should you be focused on using this as a superpower? Google, should you be building your own tools? How do you get used to it? All of this sort of stuff. I personally find it's a lot of experimentation. It's a lot of fun, but it's really confusing, and it's really scary.

Anyway, I told Alpha Sense about my problems, and they organized a webinar to try to help out. I'll be sitting down with Dave Wang of Wall Street prompts and Ben Collins of AlphaSense to break down the modern AI stack for investors. What horizontal platforms like OpenAI and Claude and Agenic workflows and finding specific intelligence tools, where each one can actually fit and help in a real research process. So if you're trying to get better at AI, improve, develop AI-enabled workflows, you're not going to want to miss this webinar. Join us on, we're going to record it next week, middle of June 18th, and it'll be going live June 25th. So there'll be a link to register in the show notes.

And, you know, please go free. Lobbin any questions you have on using AI, whether general tools or AI-specific tools like AlphaSense. So thanks to Alphicent, and I'll see you for the webinar soon. All right, hello and welcome to yet another value podcast. I'm your host, Andrew Walker. With me today, I'm happy to have on for the first time. My friend, John Cohen. John, how's it going? Doing well, man. Thanks for having me on. I'd like to say a long-time list. or first time caller, a huge fan of the podcast. So, so. Well, look, anybody who goes to Sweet Green as much as I do always has an invite on the podcast.

You should have done a live event. Well, we'd be waiting in line for our salad all day. It would be the issue. I should mention John, John Cohen from Zippoorline Capital is his firm. We'll get into all that in one second. But before we get started, disclaimer, remind everyone nothing on this podcast investing advice. That's always true. But I think John and I are going to talk a lot about UK stocks,

which tend to be on the smaller side. And as we all like the joke, the UK is an emerging market these days. So hide and risk, all that. See the disclaimer at the end of the podcast in the show notes. John, we've got a stock in particular we want to talk about,

and we can dive right into that if you want. But, you know, I very rarely get someone who has kind of specializes and focuses, and I know you would do anything, but we talked before. The vast majority of your portfolio is in the UK. I've talked a lot on and off about the UK over the past 18 months on this podcast.

I'd love to just get your, Overall thoughts on the UK market in general, why somebody who sits four blocks for me right now on the Upper East Side, you know, can invest anywhere in the world, why you've kind of honed it on the UK, swap some thoughts there, and then we'll dive into the specific stock, if that makes sense. Yeah, absolutely. So, yeah, I am, I think of myself as Ted Lasso, but like Ted Lasso, season three, not season one, where I'm out of my depth. I've been investing in UK and Europe public equities for about a decade, zipper line. It's specifically set up to do absolute return. opportunities long or short, specifically within UK Europeans, small to mid-cap. So the entire portfolio is focused on that. In terms of why the UK and Europe, what I'd say is I have no historical connection. Out of business school, I spent some time in the Tiber Cubs network, focused largely on US names, and just found the game to be incredibly competitive.

And the areas of competitive advantage or edge is a dirty word to be. sparing and difficult to find. And so for me, honestly, simply game selection. So as I know you're aware, there's less competition, greater inefficiencies in these markets. They're far less liquid. There's far less analyst coverage. You know, an analyst, in a sales side analyst job in the UK is largely a job where you want six to eight weeks of vacation. You're not paid that well. You know, they have a corporate broken system in the UK. So a lot of it is not independent research. there are far fewer dedicated long short investors, so it makes a lot of opportunities on both sides. And in particular, and increasingly so for me in one area, that's particularly a focus of UGov, which is the name we're going to talk about, is there's a lot of opportunity for shareholder engagement.

So there's a lot of low-hanging fruit around capital allocation, market communication and corporate governance. These are just frankly things, you know, if you think about what Dan Loeb was doing back in the 90s, In the U.S., it's just it's stuff that these businesses and UK PLC haven't had to think about before and are really coming into focus. So that's a great overview. Let me tell you, as someone who's dipped my toe in there and probably gotten, I don't want to say burn, but I've probably lost a little more than I, you know, a lot of what I've come to see in the UK is you find a stock that is obviously too cheap, right? Whether it's quantitative, you're just looking like, hey, this trade's at six and the U.S. peers trade at 12,

or, you know, you do more fundamental work. You're like, yes, this is too cheap. And I could point to several examples, whether it's UGov or other companies we talk about. And then what you kind of come to find is, hey, it might not be too cheap because the market is wrong. It might be too cheap because the market is slapping a huge corporate governance discount on it, right? And we can talk about all the reasons for that. I mean, small insider ownership, the CEOs generally aren't paid on stock prices, all this sort of stuff. But I've come to see the UK market, and I don't know if this is right or wrong.

The only way you get paid in the UK market is when a private equity firm kind of comes and puts you out of your misery, right? So if you can time it correctly, you can and will make a lot of money in the UK market. And the time it correctly is you buy it before the private equity bout. But if you don't, you're just like sitting here pulling your hair out, right? Every year they come out and the earnings are a little worse than you thought they should be. It's still really qualitative to your sheep. cash is building up on the stock, they probably refuse to buyback share or maybe they do a token share

buyback. But unless you get that buyout, you get nothing. And look, maybe the answer should be, hey, we should all just sit around to wait because when the buyout comes, the premiums often be huge. But I thought I was going to be buying these things of like six times price earnings. And, you know, six times your price to earnings. If earnings aren't falling off a clip, you should make like 18% annualized without multiple expansion. And I kept having it go from six to four times earnings. And maybe I was too impatient. But I would, only make money if the bio game. So I threw a lot there, but what would you say to kind of that it seems like it's more a corporate governance question than anything? Yeah, I think there's a few things

in there. And the pulling your hair out definitely resonates. If we had done this five, 10 years ago, I'd have a nice head of hair. As goofy as this guy. I'd be more like to do. So the first, I don't want to say a mistake, but the first thing that I want to pick on is the biggest lesson I learned when I started out investing in the UK and Europe is you never, ever, ever, ever compare to U.S. or even, frankly, European multiples. And you're laughing, but I'm totally serious. So I will never pitch anything and I will immediately dismiss a pitch which says you have a UK business trading at this and U.S. business trading at this. There's just a lot of reasons, a lot of what you discuss, higher growth rates, different views on regulation. There's just a lot of

different things. So I will never do that. Can I ask for one nuance in that? Yes, please. I'm just going to choose home builders because the home builders have been on the spot. Would you never compare a UK home builder to a U.S. home builder? Never. But if you had a business, and I can think of a few in the UK that have a lot of international components, you know, the famous UK listed business that for some reason 95% of the,

would you say the same thing about multiples there or would you be more flexible that? Because I could see it going either way. No, I would say the same thing. So if you think about multiples that you need to adjust, so one, as you pointed out, capital allocation isn't as optimal for a lot of different reasons. That's changed a bit now. We can talk about that. Buybacks have become a lot more frequent.

Tax rates are higher in the UK. So even if you are a global business, if you're domiciled in the UK, leverage is very different, right? So leverage may be too high in the U.S., but frankly, leverage in the U.S., in the UK is suboptimal. And, you know, look, like Ben, our mutual friend, Ben, always laughs, but a very wise man told me that there's only three natural buyers of UK stocks, share buyback, short coverings, and takeovers, right?

And so there is, you know, just a thing about being on the UK stock market where there's not a natural flow to those businesses where the multiple should definitely be lower. You know, there is arguments for those businesses to be relisted in the U.S. There's a mixed track record on that. It's really just dependent on the business. You know, if the business as well, something like a Ferguson, I believe, has done well, CRH has done well. And so it really just depends on the business. But yeah, I would say,

you know, UGov is a global business. I own a number of different global businesses in the UK. They just always trade at lower multiples for the most part. There are some businesses which trade higher. I mean, UGov is really interesting. And what I'll tell you just to kind of riff on what you talked about is how do you make money other than a takeover? I think things that I've over time and I spend a lot of time doing kind of diagnostic analyses of what's worked, what hasn't worked. And, you know, where I tend to focus today is a few key things. So first of all, you mentioned incentives. So, you know, the UK managers teams are not incentivized, let alone with incentive comp, but even just on base salary, they're just not paid enough to really think about kind of shareholder equity over the long term.

So one thing I definitely do now is I do not own businesses, will not look at businesses where there's not more than a million dollars plus of insider ownership in the business. So I screen all businesses out that don't meet that. The other kind of nuance thing is I tend to look for businesses which have a ton of shareholder analyst coverage already. Where you can kind of get in trouble is, and I think this is probably the same in the U.S. is where you own a business which has always traded at three times even da, which you think will go to six times and it has like one analyst covering it and you expect once it gets bigger to have five analysts covering it. The names I tend to look at, I call it like betting on things that have happened already happening again. So things like

UGov and other businesses, these are businesses where there is a lot of analyst coverage because they've been a far higher market cap in the past. They have traded at far higher, even normal and high multiples in the past. So we know that they can get there. And so what I'm solving for is trying to just bet on things that have happened before, kind of happening. again rather than trying to kind of bet on something that hasn't happened before. You know, just to riff off what you said, it's funny you said before happening again. Obviously, we are in June, 2006. And I don't think this is the dot-com bubble, though there are some, especially on more

the quantum computing pie in the sky things, maybe some of the much lower space quality things. Like, I don't think this is the dot-com bubble, but there are elements of like dot-com bubble. And I remember, you know, from all my career you would hear, we'll never see something as crazy at the dot-com bubble again. And then you get the SPAC bubble and the the meme squeezes of 2021, which probably weren't as crazy at the dot-com bubble. And then you get this and you're like, man, you know, everything that happens before happens again. So I know that's not quite what you're go for. Just no, I'm not, I'm just, I viewed as I'm not smart enough to bet on things that

haven't happened before. So I like to use history as a guide. It's just kind of my philosophy. On analyst coverage, interesting mention to that because you front ran one of my questions on you gov. They've got pretty good analyst coverage. I mean, just to spoil the plot, this is a 500 million EV company, if that. And this is a company covered by multiple large banks. I think UBS covers them, JP Morgan covers them. I tend not to do lots of sell side. But, you know, when I'm looking at it, I'm like, oh, this 500 million market cap company has more like big bank coverage than a lot of the two billion market cap companies I look at over in the U.S. Not U.S. go specifically, but how much do you think about when you're looking at the UK? You know,

how much are you thinking about analyst coverage and, you know, if it's someone other than you love, oh, this is one coverage. As soon as two more banks pick up, that could be the thing. Or, you know, I mentioned jokingly, UK is an emerging market. One thing that emerging markets have that I have seen in the UK, when an analyst changes their recommendation, like that can be a big catalyst for the stock. You'll see a lot of stocks up 15% on analyst change. So how do you kind of think about the interplay of, again, pure value investing 10 years ago, I would have said, oh, nobody cares. But especially in a market that's maybe a little more inefficient, thinking about those things can help you with timing. So how do you think about that? Yeah. So I think about it a few ways.

One, the important point to mention that I don't think people think about enough, specifically in names that are down a lot and where they're relatively low volume and less liquid stocks is you have used to be, let's call it a one billion pound business. It's now, you know, on a market cap basis, it's like close to $250, $300 million, right? If the banks are making money via trading, right? They're not really making money via research anymore. When it was a $1 billion, one billion pound business

and you had a lot of interest in it, banks were making money trading the stock. What I've seen a number of times, and another business not to go off on a tangent is GreenCore, which is a sandwich maker in the UK. And this was kind of my playbook. My last podcast was Alex Roper, as we mentioned, Nomad. And GreenCore, it's funny, you mentioned them,

is a loose peer that I had in like my database of, hey, their margins, EBITR margin is like 10%. Can I trust Nomads at 15% when it is brand diversity? But I literally had their PDF up 10 minutes before. Yeah, it's a brilliant business. And it went through hopefully what I hope, you know, what will happen to you of over time. But what you realize is that when it goes to a 200 million market cap, the analyst coverage stays in theory, but no one is interested in it because they can't, it becomes too illiquid for people.

The bank itself is not making enough trading it because even if they're trading the same volume, it's 80% of, right? It's 20% of what they were making before on a dollar or a pound basis. And so on the analyst coverage, I find it to just be basically tracking the share price, right? And so they wait till ultimate certainty on the business. So you have ultimate visibility, likely when I'm selling. And then they upgrade it. What I will say, and I find helpful, is the UK is a bit strange, where you have a corporate broking relationship.

So there will be a nomad, a nominated advisor in the UK, which you're required to have. So a lot of times you see UK stocks where they may only be covered by three analysts, and all three will be the UK brokers. right? And usually those brokers have buy ratings because they're doing business with the company. So I'd say it's probably more inefficient on the short side and is on the long side. I'd say on the long side what I use them for. And I think sell side analysts have a real role to play is both industry knowledge. So a lot of the UK analysts have been covering the same industry for a very, very long period of time. I get up to speed quickly because I have a concentrated portfolio

and I spend a lot of time, but I'm an industry generalist for the most part. And so having a lot of industry knowledge is wonderful. They have access to management teams. I use what I'd say, the difference where I do is I spend a lot of time with the corporate brokers, and this kind of gets to what we talk about with shareholder stewardship, as I call it, a nice way for activism light. And, you know, those guys are a conduit into the management teams and boards and kind of helping them think about market communication or capital allocation.

So I would say it's just different than the U.S. I think that you use them for different reasons, but I never use them for share recommendations. Last question. You mentioned kind of talking to the brokers to get one thing that I've certainly torn my hair out. I know you have as well. We've mentioned a few times capital allocation. I think there have been UK firms. And maybe I'm just like looking at more and a couple have popped up.

So it started, but I think there has been a little bit of a shift more towards these firms looking to do share buybacks. I wouldn't say we've gone the full, you know, Japan, where Japan was lean. I think they've actually backed off a little bit, but where Japan was leaning on companies, you cannot trade below book value. You have to return capital. I don't think we've had that yet, but I would not be surprised. I think we're starting to see some reception there. And I do think the UK is looking around saying, hey, if Andrew Johnner out here saying the only way for UK stocks to work or for private equity,

come put them out their misery, and that's like the only buyer, as you listen to Nevada short covers, I think they're going to have to come to gross with that because they don't want no public list of companies. Have you started seeing, feeling UK, whether it's companies, regulators, whatever, just a little bit more receptive to the, hey, maybe we do need to buy stuff back, maybe everything trading with net leverage under one is inefficient. Have you, have you started to felt that? I have, but I'm biasing the witness. Yeah, I know, 100%. I mean, when I first, started investing in the UK and Europe, not a single business I owned was doing a share buyback. Now, look, I spend a lot of time.

75% of my day is focused on getting companies to do share buybacks and think about capital allocation. I'd say basically 80% of the portfolio, my portfolio today is doing a share buyback. And so it is definitely changed. It's definitely changed from the corporate broking perspective, particularly because they're incentivized to do it because they make money. doing it. So they're the ones who are assigned to do the buyback on behalf of the

company. So it's another way for a bank to make money in kind of a difficult market. So that's one. I'd say the biggest thing is educating management teams and brokers as to why it makes sense to do it. Literally like the academic theory behind and the math behind a buyback, it takes a long time, but you kind of see the light bulb go off and it makes a ton of sense. So from an academic perspective, 100%, the one thing that I would say is, and I'm being a little cute here and thinking about stocks versus businesses, is beyond the math

of it making sense when it trades up in tract evaluation is the biggest, there has always been, and probably in the U.S., an idea that doing buybacks from a liquid stock make it more illiquid, so it just creates a further overhang. I actually think it's the exact opposite. So you may know this, but in the UK, you can only buy back, I believe it's 25% a maximum of your daily volume per day. Yeah, the rules. Yeah. I think the U.S. actually has that rule too, but you can't. So what happens is if you have a relatively liquid stock and let's say it's a 300 million pound market cap and you go to do a 20 million pound buyback, I mean, it could take months, if not a year to do that. And as I mentioned before, there are no natural buyers of stock in the UK. So what it does,

just again to be queued from a stock perspective is it adds a natural buyer of your stock in the market every single day, which really helps. Again, beyond the math of it just being attractive, that has been a harder thing for brokers to understand because a lot of these brokers have been doing it for a long time. But I think the buyback thing, I'd say, is one of the most encouraging things in the market. The leverage has not changed whatsoever. And I think where I'd say people probably get frustrated with me, I mean, even frankly, in You gov when I speak to people who don't focus on the UK in particular, but move to the UK and want to do it.

And an activist thing is I've kind of come to grips with the idea that the market doesn't like leverage. Frankly, if that's the worst thing in the world, that's kind of okay. Yeah. If they'll put on one-time levered versus two or three, you know, again, it kind of limits the downside risk a bit to the equity. And so I'm kind of okay. That has not changed. On the, on the, I kind of agree with the leverage.

It's just maybe it's because I'm getting more impatient in my old age. You know, it is the really quick. We go from zero-x leverage to two-x leverage in this business that probably could support three-x leverage. Like, you can return a lot of capital quick. On the liquidity font, it's funny, our mutual friend, And we were out to lunch the other day and we were talking about this. And we've had the same pushback from companies, right? Oh, or stock see liquid.

We couldn't. It's like, okay, I do understand if you're trying to buy back 100 million of stock and your stock trades, you know, 100,000 a day, it's going to take a long time. But still, on the margins, helps. But all these companies say, oh, or it's a liquid. And if we buy it back, we'll get more liquid. I would like a company to show me the proof point of that. Because, A, if people know you're going to be in the market for 25% of the volume every

day, I think a lot more of the trading firms will just have algos that are spinning up. I think liquidity. And B, if you're, it's not like you have to buy, right? But if you're going to be in there and buy 25% of the volume every day and it's going to create this liquidity problem, your stock's going to go up, right? So you're going to get your stock up. And then when it goes to a point where the valuation doesn't make sense, you can always stop.

But like all of it, it just feels like a false dichotomy to me where these companies just once on zero. And I would love someone to show me the proof point of, oh, we've bought till our stock's Scott and Soie Liquid that we've got some weird rump. And I also like to say, hey, if you do that, the stock's probably screaming higher because you're buying cheap. So I don't see the problem here. Yeah, I mean, look, I know plenty of illiquid stocks that are expensive and plenty of liquid stocks that are cheap. So I don't think the argument holds at all. I think, you know, the other thing that I would mention that's really changed. And just because I have a little history of it,

you know, back in the day, Neil Woodford and Mark Barnett were like the kings of the UK market. they were dividend income investors. The easiest thing a UK business had to do to get a natural flow of capital was to start a dividend. So that is why all of these UK businesses have dividends. There's a dividend culture.

And, you know, look, Neil and Mark are not in the market anymore. And dividend income investors have massively dwindled as part of the register. And so it's just been a real education. But again, like I have, you know, we can talk about you. of the things that may be the most happy and was a direct result of, gosh, hundreds of emails and calls of the manager team and board of you gov is that I was able to get them.

They were paying a 10 million pound dividend. And, you know, when you're a billion pound company, that's nothing. When you're 200 million, that's something. And so, and you're trading at 15% for cash yield. So we've now gotten them to agree to do a. turn that into a buyback at a minimum. And so one of the things, one of the things that I'd say that I've worked on is to your point about turning off the buyback is this idea of like a very flexible capital allocation plan.

So it's not that one commits to doing a dividend or commits to doing a buyback at all times. It's having the flexibility to say our stock is cheap. Let's buy back stock or eventually turn it into a dividend. And so having that flexibility. that will be a longer evolution, but we're getting them to do buyback. And that's a great transition. Let's talk, UGov. I think people will probably, hey, that was really fun. But we've talked for almost 30 minutes on UK government.

And I think multiple times you mentioned UGov so people can probably see, he's seeing here how excited you are about you gov. Let's turn to that. And I'll just start with the question I like to start every podcast. What is UGov and why are they so interesting? And before you get there, I have to note, their CEO's name is Stephen Shakespeare. and that is just quite the name. It's even better when you pronounce it that way.

Quite the name. But what is Ugov with their CEO, Stefan Shakespeare, and why are they so interesting? Yeah. So just interrupt me. I love this business. Go, go, go. So I'll go on a bit of a tangent.

But basically, in terms of talking about the business, so I would say Ugov probably screens at first as kind of a market research firm at first glance. In reality, it's a proprietary data business. So everything they do and sell, products and services, they're all derived from their proprietary data base proprietary data set of attitudinal data. So this is from 30 million people across 60 plus countries over the past 20 years. Your next question is kind of what does that actually mean? Very good. Businesses basically use

you gov to track things like awareness, perception, where people are in their purchase funnel for various brands and products. And so just to give you a little more, like layman's examples. So this can be things like businesses tracking their own brands. So BYD, which I'm sure you're familiar with, they're a recent customer, they're trying to expand into Europe. They are using UGov to better understand their customer awareness, perception in Europe. Things like Marks and Spencer, which is a big UK retailer, they use UGov rather than kind of having their own in-house data collection. Or the best example I think, and it's just because I spoke to one of them as a customers, a book publisher who has a new book. They're trying to figure out

what the right demographic or best demographic for that book is, and to take that demographic to be able to market it at the right retailer, right? And so you can kind of use all of the UGov services there. It can also be advertising agencies, marketing firms, so they're helping their own clients, and they're really interestingly, it can even be people like us, so investment firms. So, you know, great examples when the tariffs came out in April 25. You've actually had a hedge fund client come to them to track consumer sentiment to tariffs and pricing sensitivity in all geographies. So that's kind of like a very broad way about what it is, what it's used for.

In terms of how it's used, it can be consumed in a few different ways. So these are largely syndicated tracking products. So you go on, you see a syndicated thing where they have Marks and Spencer, they may have your suppliers, they may have your peers, and you can check how you do. And this is basically refreshed daily. You can have custom tracking or surveys. So if you want a very specific audience that is started to do, or you want to do it just for a specific brand or product.

And also increasingly, they also have a self-service platform, which is enabled by AI as well. The business is recurring a real. repeat for about, they don't really report it. It's about 60% of revenue, 70% of operating profit. Those are the rough estimate. So again, it's much more of a repeat recurring revenue than your kind of like big project, large consulting or market research firm. You know, the way I think about the world is I think about, you know, I divide value investors into different camps. So this is a massive generalization. So don't, no one get angry. But, you know, you have value. investors who focus on situations, so turnarounds, regulatory events, that kind of thing.

And then you have value investors who focus on business quality, long-term compounders. I've done both, and I very aptly combine the two to do what I call business plus situation framework, not that creative. And so when I think about you have, I want to own a high-quality business, that's growing, large addressable market, high barriers to entry and barriers to being good. with a line management teams, but I also want to understand why the opportunity exists today,

why I'm competitively advantage to own it. So when I think about UGov, in terms of business quality, I think about it starting from kind of barriers to entry, right? And so UGov, as I mentioned, has one of the few truly proprietary, high-quality, trusted data sets of attitudinal data. So Kantar and Nielsen are other large-scale players

that have something similar. the important differences are the same, they don't have the same magnitude of longitudinal data, which is a fancy way of saying they don't have all the historical data that UGov does, UGov has been doing this for 20 years, they don't have the same magnitude of it. So UGov is by far the longest standing data set, and there's real value in that, right, because you're looking for changes versus history. And their data, importantly, isn't as frequent. So Kantar and Nielsen might be weekly, monthly, quarterly.

UGov's panel and data is refreshed daily. So the best example I think when I think about UGov to understand the value proposition is, do you remember when Dieselgate happened to Volkswagen? Of course. So VW reached out that day to UGov. Why UGov? So UGov has been tracking consumer perception and awareness about Volkswagen, even without Volkswagen being a customer, right, or a client for 20 years.

So Volkswagen, Volkswagen calls them, and they want Ugo's panel to basically track in real time what's happening since the scandals to their brand perception and the things they're doing are working or not working. You know, another solution would have basically taken months to set up and you're flying blind kind of like in the heat of the scandal. And so that's really where you go of this like wildly valuable and helpful. You mentioned being Ted Lassau. I tried to be like a golden retriever and be.

just ask eager questions on this podcast. So I'm going to ask a question one. You say, you go gets the panel, right? And I understand the panel as humans, but what is this panel of people who in real time are responding to Volkswagen's brand? Because,

you know, I've seen the thing that pops my head that during the presidential debate, where they have everyone with like a dial. And if somebody says something good, they shift it so they can tell you how, you know, during the presidential trade for two hours. But Volkswagen,

like, yes, Volkswagen dieselgate. If I'm a casual news consumer, I'm sure I see it. I'm like, oh, they cheat on their diesel emissions. That's terrible. But in real time, like, how are they even tracking that across the panel? Yeah. So what's interesting about UGov is they have uniquely high brand awareness, particularly in the UK.

You may have even heard of UGov. So UGov is like the number one or two cited research source in the world, right? I mentioned elections. Economists, you, like if you're, once a week, there's a new, poll and a lot of it is the Ipsos, what, blah, blah, blah, blah. One of them is the Economist UGov poll, if I'm remembering correctly. Like, that's one of the big polls that comes out. So, yes.

And particularly I'd say in the U.K., UGov is known as a brand. So, like, you and I could go to the UGov website today and we could say, like, you know, what is, where does GreenCore's brand, you know, rank in terms of competitiveness. So it's interesting because that's in a sector where it's not typically known for that. Like you and I know Kantar and Nielsen, like your average person on the street. street wouldn't, whereas you go to the, on the street in the UK, like everyone will know you gov. Why does that matter? That matters for two reasons. So you mentioned how did they get these people? So first, you have a loyal fan base of people who love doing this. They like being part

of the Yugo brand, part of the kind of the UGov fan base, loyal base. They get a gift card. Now, why does it matter that you have high brand awareness? Two reasons, as I mentioned. So first, strengthens the quality of the data set. So to your point, who are the people doing this? Well, one of the reasons why the data set is so valuable is just the way we're looking at a business. You want apples to apples or like-for-like comparisons. So it becomes incredibly valuable if you have high retention, lower churn of your panelists. And so U-Gub has by far the highest retention of panelists, people logging on every day. They're getting prompts. They love doing this, right? They love being part of this.

And secondly, it reduces cost because you have greater incentive. Again, people like being part of the brand. They think about it as like a second job, a side hustle. They like being, you know, I've, by the way, seeing LinkedIn profiles, which mentioned they're like a youth of panelists. How much do they pay the panelists? I don't know off the top of my head. It's not as high as others.

They're usually in things like gift cards. And they're like every 10 responses you get a gift card. something like that. So panel costs are reasonably high, but the real cost of the panel is maintaining it technologically rather than panel costs of acquiring people. And again, that's because, you know, if you've been doing this for 20 years and you're doing it for a long period of time, you have this embedded group of people who just enjoy doing this. I mean, we're getting a little off tangent, but just to, because it's probably hard to contextualize being me or you who would probably never do this as a panelist, or at least I wouldn't.

So when we would talk about AI, UGov is very good at showing when things change. So for example, VW comes out, they have the scandal. You will clearly see a drop off in perception, right? And if you didn't know the scandal was happening, you would go back to VW and you'd say, hey, like just showing you why this is happening, you know, showing you that this is happening. VW would then have to say, well, why is this happening, right? We have to figure this out. There would be two ways to do it.

VW could do it themselves. Or you could hire YouGov to do a customs survey and basically you'd hire a bunch of people. You'd have to go out and take a bunch of time and it'd be expensive to answer the why question. Why it's interesting and relative to why people do this is UGov recently launched something called brand index voices. So they now, at the end of every panel, they have an AI bot that pops up and says, I see you change your answer on this. Why? And the panelists will talk to the bot. It's about a quarter of panelists today that are kind of engaging with that. What's interesting about it to get back to the original point is that there will be people and panelists who stay on with the bot for an

hour and talk about things that are totally unrelated to the question they're asking because they like having someone to talk to. And it's amazing for YouGub because they just continually to collect data and increasing amounts of data on this person. So they showed it at a demo at a recent of yesterday where they talked about like, what kind of music do you like? What kind of movies do you like? They get more and more demographic data. So I think it's hard to appreciate why someone would do this, but there is a loyal group of people. All the calls you do with competitors and customers talk about the quality of data, again, in particular, the high retention and the lower cost, which really creates a very, very high quality data set. Let me use that to, I think you've, the

most frequent question I ask is, what is the company, and then what is the market missing? I think you started to hit that. But let's talk about, I think, the elephant in the room, you know, the stock. two years ago, two and a half years ago, it's trading in a thousand. I think they have a bad earnings report. But over the past year, it's been, let's just round up and say it's been cut in half. And I think a big reason. More than 80% just to be. That's if you go back two years because I think last year was either one, whatever, it's down a lot.

I think a big reason for the drawdown in the past year has been AI fears. And the company will come and tell you, you know, I was reading their Q1 earnings report or H1, It's, God, I hate the UK H-1s and everything. But I'm reading their H-1 earnings report. And the first slide they have is, if I'm quote, AI is creating a powerful structural advantage for UCOF, right? And this is really interesting to me because we just, you let off when we were talking buybacks. The company is canceling their dividends of buyback shares, right? So that's a sign.

The company is saying AI is creating a powerful advantage for UGov. And we've started to talk about with that. We can talk about that more, right? But the market is saying AI is a disruptor. These guys are part of the SaaSpocalypse. They are down 50% of the past year. So we can talk about why you and the company believe the market's wrong. But why is the market scared of AI for this company?

Yeah, sure. So we can also at some point go back and talk about some of the idiosyncratic things that caused the drop kind of before. There's some idiosyncratic stuff. Hit them, hit them. Yeah, yeah. But let's do AI first because it's, as you put out, it's the elephant in the room. So I think, let me talk about this two ways. So I think let me share first how it relates to you gov specifically and then I'll kind

riff on how I think about this in the broader context. So with regards to you gov specifically, I think the market's knee-jerk reaction, as you appropriately pointed out, is they do surveys or something like surveys, so they must be an AI loser. What's interesting to me is that this is not a business like Qualtricks, right? So Qualtrics, as far as I understand, it's, you know, online forum, distributing surveys, used to be done by hand. In UGov's case, one literally can't get the data from a UGov survey without access to the proprietary data set, right, and to the proprietary panel of 30 million people, 20 plus years. And so if anything, AI, applying AI technology to Ugo's proprietary data set only further enhances the value of it doesn't detract from it.

So I gave you the example of brand index voices, right? So that's an amazing, I think that's a game changer, right? That now allows you have to answer the why question. So it creates a new service for them. They can do tens of thousands of these every single day, and they can do it at minimal to no cost. This is something that would take weeks or months and be super expensive for the clients. That's one example. Another example. Can I pause you on that one? Yeah, please. So they've got the 20 years of data, and that's something you and I cannot go recreate, right? That's in the past. And unless we can discover, you know, time travel a la Harry Potter and turn the back client. In which case, we'd probably do other stuff than do this panel, right?

We'd probably go by a video call. So we can't do that. But in the, so there is a little bit of moat there. But in the present, you know, you're basically saying, hey, they've got the 30 million people and they can do these brands or hers. I guess my question is, why couldn't you and I aren't going to do this, right? But why couldn't a lot of people spend this off? I will mention, I was talking to a friend, had him over, and he works at a consulting firm.

And it was like, oh, we just did this big project. We're recreated an AI. customer audience for a company, right? We took a bunch of, and the company could ask the customer, this like AI audience things. And I knew we were doing this podcast. So I was thinking, oh, that's not quite you gov, but that's getting pretty close to you gov. So why isn't this, I hear you on AI could improve this, but why doesn't this also create

a lot of competitors that can say, hey, we can go create a lot of people for them? Yeah. So you actually just jump to the point I was to talk about anyway. Okay, great, great. This is good. So I think the market knee-jerk reaction is relatively on sophisticated, as we talked about, as it just being a survey and you have the data. I think the more sophisticated take, which, of course, you have because you're very sophisticated,

is around using synthetic data. So this is effectively using AI bots instead of humans to generate human-like responses as data points, right? And so there's a number of ways to think about it. So first, it'd say not to be too academic about it, there are a number of studies, which have been recently done, which basically show synthetic data to be highly problematic. So there was a UK organization, I think it's called Strategic 7, Stratt 7. They basically did an entire study, which found the data lacked logical consistency. And the more interesting thing is that there's a great New York Times article, which you may have

seen. I think it was called like the death of polling or something. And where they talk about a Cornell study, which showed that synthetic data results were basically wholly unreliable because they were full of extreme bias. The article mentioned a company, I forget the name of it, they ran a simulation with their AI synthetic data of the 2024 presidential election to see what it would come out as. And they basically inaccurately reported that Kamala Harris would narrowly win. So the New York Times, the bottom of the article just calls all of these kind of pure. fiction. So the other thing I'd mention is when you think about what UGov does, right, so we talk about UGov trying to find and measure change, like abnormalities in the trends, that's what you're using it for, right? Using so again, like using one of the examples before,

like Dieselgate VW, they wanted to see how their brand perception deviated from trend in the past, like once the scandal broke. By definition, synthetic panel data is simply extrapolating from past data, right? It's not a human changing, so you'll never really be able to use it for what UGov is providing. I think the last, perhaps most important differentiation is that there's a difference between synthetic panels and synthetic data. Okay, so UGov actually can and has started to use synthetic data based on real human panelists and responses. So if you want something done at greater scale or more importantly, greater speed and potentially at lower cost, U-Gov can effectively extrapolate or interpret from their kind of real human panel,

a synthetic data set. Now, the difference is that this can be audited, and it can actually be verified by putting the question to the human panel if the data needs to be verified, right? So if a customer comes back and says, look, this answer seems weird, right? You can go back and say, well, let's just ask a couple panelists to verify if this is really how they would answer based on their demographics and this. And so what's interesting for UGov is that is, you have tends to be the higher end of the market, right?

So these are guys who will pay 50, 100K for a service like you gov. This is actually a product which I think expands UGov's use case where it can be used for lower-end people, lower-end businesses, because it can be done more quickly, greater speed and at lower cost. The other point I'd mention, and it's a little, Tangential is that part of what happened during COVID and why they saw a little bit of increased competition is that when you had a really, so you had increased demand in 21 and 22 for these types of services, you've benefited from that. But you also had a really low, low cost of capital

environment, right? And so you had businesses like GWI in the UK, morning consult. There's a Swedish business called Sintz, which is a fun stock chart to look up, and another one called Dynata. And so what all of these businesses try to do is in different versions, take small proprietary datasets, combine them into one data set, and call them one large proprietary data set, right? So take, sorry, take a bunch of small third-party data sets, combine them and claim it's one large proprietary data set. And basically what happened is they all raise capital at unicorn-like valuations. And so they all had no abandon for price, and they went really aggressive after revenue growth.

Basically, all of those businesses are struggling now. So since, which is an amazing one, that's down nine, it's Swedish IPO, down 95% since the IPO. They basically found they had to report fraud within the dataset. So they didn't have people kind of accurately responding. They couldn't verify panelists. Morning Consult has done a number of layoffs, GWI. you can look at the UK company house accounts, that revenue growth is slowed. They're now in a debt position.

And Donata has kind of filed for bankruptcy. So what I would say is if anything has happened over the past few years, it's actually been that data quality. And when you speak to people in the industry and you speak to customers and clients, data quality accuracy is by far the most important thing. And there's just fewer and fewer people that can do. that, right? Because you need to have all the systems in place and all the quality behind it. It's one thing I have thought about with, it's one thing I have thought about in the AI world.

And you mentioned synthetic data. There was actually an article, I think in the FT recently that was talking about, hey, KPMG released this deck on using AI. And there were all these AI hallucinations. And a funny article, but the one thing that jumped out to me is there's a line like two-thirds-through that says, hey, people like KPMG, known brands in a world where there's a lot of AI slop coming out, the known brands actually kind of cut through because people say, oh, KPMG put this out. I can trust them. You know, I'm sure it's sports. ESPN put it out.

I feel pretty good that it's something verified versus if it's on, you know, NBA Centell, I think it's a lot of people with jokes. There is something to, hey, you gov put this data set out. Now, I don't know. There is the question of does the brand matter for what, getting put out or something, but there is something, too. You go put this data set out. I trust them versus Andrew John spun up a chat GPT and they put the data set out.

Our data might be right, but people don't trust it. I have been wondering if that brand is something that, and I think this might be what they're saying in the AI world. It's easier for them to do it. They can sell bolts on services. But I am wondering if that brand just like, hey, we can trust this you gov data versus Jop form or wherever we're getting else. It's something I've been wondering.

So again, like I think the brand. matters not just from the consumer perception, right? But also, as I mentioned, it sounds soft and kind of like a throwaway term. But you've literally, despite most people on this podcast, probably never hearing of it and knowing it's publicly traded, it is literally the number one or two consistently for 20 years, most cited research source in the world. And even someone like Nate Silver put it as its top five most accurate polling. So one thing that's interesting is everyone knows Yuga for polling. They basically make no money on that. The idea there is to create a brand of accuracy, right? They're by far one of the most accurate pollsters around

politics and different things like that. That is to create a brand that is trusted and verified and everything like that. And so, you know, what I've seen when you speak to clients and, again, you can see it in the market is that the value of a proprietary data set, which can be audited, verified, and is proprietary to you has just gone up increasingly. And I think, again, I, you know, I enjoy being a contrarian. I think that is only even more valuable in the world of AI. The last thing, so a few other things. One thing specific to UGov, I think, is a great irony that I like mentioning is,

so not to go off on a tangent about expert networks, but we can eventually later on. But I've started to use LinkedIn a lot more for primary research. I'm constantly doing searches about once a week for every company I own. It's amazing. People overshare like crazy. You can learn so much about who they're hiring, firing if they're going on sales trips because they beat their budget,

different sorts of things. And it's free and I'm biased. And one of the interesting things is that over the past few months, you've got share price goes down basically anytime Anthropic launches something, right? And a few months ago or a month that you would go, I noticed that someone from Anthropic called out UGov saying thank you to them for helping them with their Super Bowl campaign. And more recently, Anthropic launched something called a public record series, which is basically

surveying Americans about how they feel about AI. And again, they use UGov. So it's pretty entertaining to think about the fact that, like, the largest, one of the largest AI companies of the world is reliant on UGov for a lot of these things. To do it a little bit more broadly, and you can tell me if this goes on a bit of of a tangent, but I think to your point about the market environment today, one thing that I think is unique to my experience is I was out of fun called Coltrane. We were largely net short during the 2020, 2021 kind of 2022 bubble, whatever you want to call it, spec, meme stock,

all this stuff. And that was an incredible experience to have for someone who didn't live directly through the tech bubble. And I think is relevant to a lot of stuff today. And I think the few lessons I learned and I've been thinking about a lot are experts are cyclical, right? So whether it's COVID tariffs or AI, everyone on social media has a strong, quite often hyper-polic view. There's very little context, right? Are they qualified? They might be. Are they qualified to have a view? Maybe they're not. What are their incentives and biases? And what I will notice is, and I will guess what will happen here, is they typically kind of exit stage left, right? As quickly as they appeared once this happens. And I think my, as a result of that, and I

I think it's directly relevant to what we're talking about with AI today is that my experience is that the market is a particularly poor predictor of medium to long-term winners and losers during periods of change. So again, not to go off on a tangent, but all you have to do is look at. So I was short, Peloton, and Hellafresh, right? So these were touted structural winners during COVID, which I was short. I was long on Green Corp, and I was long a business called Marston's. Green Corr makes sandwiches, relies on people going places. Marston's is a punt. I rely some people going to pubs and socializing. These were structural losers to the market, and I was long these, right?

And all you have to do is pull up the charts of those businesses from April 2020 to today, and you can look at the fact that Peloton and Ella Fresh are down 80%. And, you know, if you look as of January of this year, Marston's a green car, we're up 75 to 100%. Right. And so I think what's interesting during this period is that there's a lot of like, you know, correlation of one moves. A.I. Loser winners, you know, during COVID, we had pandemic losers, pandemic winners,

in these different baskets. And I just think it takes time for the market to flush out what are real winners and losers. Can I push back slightly on that? So I don't disagree. And, you know, obviously, I don't even know if Pelton's the best scam because there are some much concerns. But let me just push back into the slip. I mean, AI is evolving so fast. And one of the things I've worried about is getting Chad. And check for those you don't know is like Google was, Google for college textbooks, basically. Right? And I went and looked, and the day chat, she beat, you came out.

The stock was down, I don't know, 30%. And I wouldn't look at their history. It's really interesting history to look at. Management comes on as soon as it comes out, and they say AI is going to be great for us, right? We're going to be able to catalog this books better, give better answers, and the stock goes down more. And they buy back shares, insiders buy. And I mean, the stock, this was a compounder, right?

And the stock has gone from 150, 100. I can't remember. As you and I were talking, it's $1.12. And there were no physical assets here, and AI replicated it and destroyed it. And I worry about a lot of these SaaS companies. And I have come around to it. I can build a tool that's fine for me. It's got rough edges. It doesn't scale. If you vibe code your organization CRM or mission critical stuff, you're going to die. But you know, Wix.com. I wish I had the balls to short it when I was writing this. But Wix. Wix.com, it was really obvious to me. A lot of websites are going to get made with Chats GPT, not Wix, right?

And the whole thing was easy to build. And chatGP. AI comes out. They say, we're going to be a winner. We bought Base 44. We're going to be a winner there. They do a huge tender, lever up buy shares down, down, down, down. They're cutting guidance, everything.

A lot of these SaaS companies are we about. So I guess what I'm saying here is I definitely hear you on the market over-emphasizes. But when I look at a lot of the companies today, I mean, it seems like maybe, maybe, Maybe it's too much. There are companies, you know, I kind of agree with this. An Oracle or Salesforce, they're getting shot. Microsoft, these are mission critical stuff. It's going to be hard.

But at the same time, when I see a Wix or some of these lower-quality SaaS names are like, yeah, it's pretty scary there. Like, there's a lot of terminal value question. So that's not specific to you go, but I just ask. No, no. So I think a lot about this. I mean, one, before I get into a broader riff on this, what I would say is one thing I've been careful about with a number of these businesses that I own is I don't know check at all. So I may be totally incorrect. But if some element of their market is the academic market

or education, you know, one thing about owning B2B businesses, which importantly are not in academics, is that ultimately with academics, your end consumer is a student, right? And so there's inevitably going, even if there's not pricing pressure from the university, there's inevitably always going to be pricing pressure because the consumer is always a student and there's always a bunch of open source alternatives. So, you know, for me, when I think about you gov or a number of other businesses that I own that are on the similar theme, it's always been to your point about Salesforce or Oracle. It's always been B2B focus, mission critical, right? You gov only sells to businesses. You know, if anything, the idea is you gov hasn't pushed price as much as they

should and there's probably more value that could be extracted. out of clients for UGov. So I'm very focused on that. One thing that you, so the other thing I'd mention is, and the nice and the bad thing, I guess, about the UK is you never have to worry about ShareBasedcom. So the multiples are the multiples in UGov. And so at least you know that to worry about that.

And it's definitely not expensive, which is also some issue with some of those SaaS businesses. ShareBest, it's funny to say that because, again, I've written a ton of, before you get these people, they were like, hey, the company's trading 10 times for cash. I'm like, yeah, but the stock, you know, adjusted EBITDA is 200 and stock comp is 300. So they're actually, you take the stock comp, it's negative. And you're saying, oh, it doesn't matter to the stock comp, but it was issued higher.

I know one company, I wouldn't look. They just filed their 10Q. And they had 40 million shares outstanding before the quarter. You know, the stock comp, the stock's down 90%. They issued four million shares intra quarter in RSUs, right? So you're saying, oh, the stock comp doesn't matter. well, you know it's 10% less of the company than you did 90 days ago. And that company's going to start to matter real fast if something doesn't change there.

You mentioned, just go go. Sorry, not to interrupt, but I want to, you mentioned something really important that I wanted to get to. And it's a broader framework I've been thinking before AI, but I think somewhat luckily, it actually applies to AI as well. So, I mean, you and I've kind of talked about this before, but increasingly I think about the world as, again, I'm a very simple man and not that smart, but I think about the world between content businesses and distribution businesses.

And so when I think about content, I mean, literal content. So something like a you go of, right? You own literal content as data. Think about brands, IP. I even think, honestly, you know, brick and more experiential real estate, something like a pub, that's an experience, that's kind of content, you're going for that.

And a distribution business is something where you're the middleman, right? So you're like a department store, you're one of the payment processors, your third-party marketplace. And one of the things that I've come to realize over time is that I just have a greater appreciation for investing in content businesses because I think it makes long-term compounding easier. So I'll kind of explain why.

So I think the barriers to entry in a distribution business, for the most part, are scale, right? That's generally how they, you know, it could be network effects a bit, could be complexity, but it's generally scale, right? For content businesses, the modes are, the barriers to entry are more sustainable, right? So, you know, scale is infinitely, you know, somewhat easier. The modes are deeper, right? These businesses are less susceptible to disruption because inevitably you can move the content

to a different form of distribution. You have more optionality, right? Like, no one thought Disney would be a theme park business, but it's a theme park business and it's a, you know, there's a lot of things to do when you own content. there's pricing power, and there's simply greater runway for growth. And that's the way I think about the businesses today. So a lot of the businesses you're mentioning, I don't know them. So I'm not, I don't want to speak kind of out of turn.

But the way I think about the world today is I don't want to own a business which may not be disrupted by AI or might be minimally disrupted by AI because I feel like you'll be fighting the terminal multiple or terminal multiple for a long time. It could be cheap. There could be periods where it works out. but you kind of just be fighting on his hamster wheel. I want to own businesses where the market thinks they're disrupted by AI. And I think they're literally going to be worth more because of AI.

And, you know, we can debate some of this, but, you know, one great example is music, right? So, you know, when we were teenagers, we were buying CDs, we were buying them from, like, Sam Goody in the UK, buying them from Virgin Records. And the top music labels were Warner Music, Sony and UMG, right? You know, Warner Music, I think it IPOed at like $2 billion in 2005. It got taken out for $3 billion in 2011. You know, it's worth $15 billion today, right? Even with some of the pullback.

And all the three labels are all the same. Yeah, there's been some consolidation. But we're now consuming that music through Spotify, right? We're not doing it through the record stores. Those have all gone by the wayside. So that's kind of your distribution versus content. Kind of same with movies. The pushback would be Netflix.

What's interesting is that Netflix only became as valuable as it did when it started investing in its own content anyway? No, look, as you were saying that, I was thinking, like, as soon as you said, because I've written this before, in media, in the past 10 years, if you bought anything in media, you're dead. You're out of business, and I know this because I had a big media and cable exposure. It's a big drag on performance. Same with the UK, by the way, don't worry. The only thing that has worked in media is Spotify and Netflix. Those are the only things. And so you wonder, look, did they get lucky?

Yes, probably. Moats, all this sort of stuff. But, you know, Netflix, I did have a little bit of a revelation where I've always been with you, like the content, because who would have thought that you could with, you know, as AI comes along, all of a sudden everybody's making Star Wars, Jess. Well, Disney's going to get paid on that in some way, shape, or form. Who would have thought that Star Wars would get turned into a theme part? all this sort of stuff.

Like, it just keeps flowing. I think sports teams are great. Every year, the Knicks have a new sponsor on their patch for, you know, who would have thought four years ago? The official prediction market of the New York Knicks, the official crypto of the, like, all this sort of stuff. So it just keeps expanding. But the past 10 years, every media stock has been slaughtered except for Netflix and

Spotify. So you do wonder, as the world fractures and as distribution gets easier, but there are things that, like, it is interesting to think about that. I don't have any answers. I think the music businesses have done very well up until like the last, the last year or so. I think what I think about is like I think the better example is like Walmart versus retailers versus brands.

So yeah, like if you and I had just simply owned Walmart, we would have been fine, right? Or Target would have been fine over very long periods of time. But there were a lot more retailers than there were brands. And there are, there's only one Walmart today after the internet. And there's only one target today. But there are a lot of brands. There are a lot of very, very long-standing brands.

And so, yeah, maybe it would have been better to simply buy Spotify rather than Warner Music or Sony or UMG. But you had more options than Spotify. And there were a bunch of different distribution things. Napster. You know, there were a ton of, I used to download off like LimeWire. There were a bunch of different options where you could have gone wrong. Pandora didn't work.

Yeah. And the other thing with UMG, that's interesting. And this actually might bring it back a little bit to, you go like, what's the most valuable business of UMG? One of the reasons I think UMG has done so well over the past 10 to 15 years, this is my supposition. I can't claim I'm a huge expert, but the bat catalog has gotten increasingly valuable, right? Because the new music is so difficult. But the back catalog with Spotify and all these things has just absolutely exploded.

And I think part of that is the distribution has gotten easier. They owned it. And people are listening to it a lot more. But I think also part of that is because the world has gotten so fractured, like new media, new TV shows aren't hitting as hard, like friends, the office, these things have much longer lives than they ever would have. So I think that Bat catalog, and for the UKGov, you know, maybe there are brands out there that want to, that 20-year data actually comes really, becomes really valuable. I don't know, though, because the other piece is, hey, SpaceX is now the fifth most valuable

company of the world. Maybe the third most valuable company, as you're speaking, like, SpaceX doesn't have a 20-year history, so maybe, like, I don't know. Yeah. Yeah. Look, and by the way, to be clear, like, you know, UV is. working with B-YD. They have no data with them, right? B-YD is moving into Europe. They want to better understand their perception. That is something where they want to track it and build up

data over time. The point is you don't need the 20 years of data. It's just the more time you have it, the more valuable it is. And the one thing that we kind of didn't talk about was if a customer were to turn it off, you have owns the data. So the data is only as valuable as you've been tracking it. The longer you have it, the better. And so, you know, this is a long winded way of saying, you know, the way I think about AI is specifically to, to, to, to, to, you gov, it's more broadly and, and, and, and, and, and, I think, and I think you gov will ultimately be more valuable. You know, when we think about just what we were talking about in terms of music, I think about music. I think I must spend more on music today, and Warner Music or

or GM must make more on me per music than they did selling CDs, right? And, and, you know, and, in 2000, so I worked in IR as an intern at Warner Music because I'm a big fan of a music fan in 2005, 2006. And I can tell you that definitely wasn't the consensus view, right? And so the fact that we are here now, look, the biggest pushback would be that those businesses went through very difficult periods of time before they figured it out, right? As we talked about Warner Music, IPOed it to $2, $2 billion. They were taken out in 2011 for $3 billion. You know, it took a for them to get there. What I'd say is interesting and different about today is, to the point you made earlier, AI is moving really fast. Like, you know, we didn't have streaming in, that was

really popular, like, one minute after it came out, right? It took a while for it to come out. It took a while for Apple Music sort of come out, figure all this out. Like, you have already has commercialized AI products that they're working on, right? And so these things are just moving faster. And so, yeah, there's been a hiccup. And I appreciate it to super anti-consentencent. of you. But, but I think, yeah, I stick by that. All right. Well, we, I actually had a lot to follow up on, but we're running long and I'm going to have top in a bill. So let's wrap it up there. We'll have to have you back on because there's, I think there's seven UK stocks is your portfolio. We've only talked about one. We've got six more to go. So John Cohen from Zippoorline,

this has been awesome. And we will grab a sweet green soon. Sounds great. Thanks so much, Andrew. A quick disclaimer. Nothing on this podcast should be considered an investment advice. Guests or the host may have positions in any of the stocks mentioned during this podcast. Please do your own work and consult a financial advisor. Thanks.