Operators, not spreadsheets

Before I allocated capital I ran a business. I know what a model leaves out, because I spent years living in the gap between the model and the morning.

A spreadsheet tells you a factory runs at 82% utilisation. It does not tell you that the line manager who keeps it there is sixty-three and has trained nobody to replace him. A model shows a customer at 19% of revenue. It does not show that the whole relationship sits on one engineer's mobile number.

What I'm actually checking

So we visit. We walk the floor and talk to the people who never make it into the investor deck. Then we ask the dull questions. Where does this break? Who would notice if you put prices up 5%? What would it cost a competitor, in years rather than money, to take your biggest account?

The numbers matter enormously. We are not romantics about gut feel. But the numbers come out of an operating reality, and you can only read that reality by standing in it. A business does not have a smell on a screen.

The views above are the firm's own and are provided for information only. They are not investment advice, nor an offer or solicitation to invest. Capital at risk; the value of investments can go down as well as up, and past performance is not a guide to future results.