The Exchanges

Q How do you think about the use case for shorting now?

A I still think it's as compelling as ever. Maybe I'm a dinosaur in that regard, but what is the value of shorting? Well, first, it absolutely makes you a better investor. It forces you to be open-minded, forces you to be skeptical, not cynical. There's an important difference. It forces you to really question market narratives. So I just think it requires more objective process discipline and If we weren't shorting, I think we would be more prone to succumbing to not challenging key assumptions the way that we should. I think that is very valuable. Certainly within a portfolio like ours, I think in our first conversation at Columbia, I wished for a world that looked more like David Swenson's original formulation of long short, where he was putting a four to five percent short rebate into his target returns. Well, guess what? At least for right now, we're getting a four to five percent short rebate. So if we can then create alpha on top of that, that's quite powerful. And then of course, the ability to just help protect capital and fund our long book, particularly our concentrated long book in our model is very critical. And to be more explicit about that, we have our highest hit rates and our highest slugging ratios in our ideas that have been seven percent or more of capital at risk. And I have a cohort of roughly 38 of those ideas inception to date. Our ability to put those in…

AI assessment note: “I still think it's as compelling as ever. Maybe I'm a dinosaur in that regard”

Q What's the aspect of it that's so hard?

A It's better to fail conventionally than to win unconventionally. If I have a high active share portfolio, by definition, there are going to be periods when I underperform, maybe even quite severely. But the opportunity that comes with that is the opportunity to really outperform. But both I as a manager or an allocator may prefer to fail conventionally rather than to take the risk that leads to the excess return. It's that simple. And markets reinforce this. Thinking back to the film, the point that Pacino's making in his speech is, Hey, you have two young men on the stage. One is trying to do the high integrity thing, and the other is not. And you're going to reward the one who is not doing it at the expense of the one who is. And that's really what the market mechanism does. It tends to reward the expedient solution at the expense of those willing to take the path that will ultimately lead to alpha, but albeit one that might be much more challenging.

AI assessment note: “It's better to fail conventionally than to win unconventionally.”

Q How different is the screening and availability of those types of ideas today? Compared to five years ago or 10 years ago.

A I actually don't think it's that different because we run a concentrated portfolio where we're deploying maybe 20 long securities, and ideally the top 10 will be 65 to 80% of the risk. We have sort of the opposite challenge, which is we're trying to find one to three ideas that we can be very levered to, and then maybe another five to eight that can be quite impactful. So we're going to miss things all the time or not even be aware of them. But I don't think the underlying base rate of opportunities is that different in terms of their availability. Now, what can be more transient is our ability to underwrite them. So for instance, in 2022, when there was just a tremendous amount of uncertainty about the business cycle, about all these different macro things that were happening, the interest rate cycle, it was definitely harder for us to forecast fundamentals of businesses in general But the actual availability of ideas, I don't think it has been that cyclical, if you will.

AI assessment note: “I actually don't think it's that different because we run a concentrated portfolio”

Q How have you managed your short book? It just seems like with all of the volatility, it's gotten harder and harder on individual stock shorts to be able to generate alpha, let alone make money.

A In the 22 or three years that I've been shorting stocks, every day that goes by is the hardest day that it's been the short. You are well aware of all the practical challenges of managing risk, of frictional costs, of things like that. And then I think what has also changed the last few years is, again, going back to something I mentioned a few minutes ago, obviously the rise of the platform model, given how much it's grown, and then it's levered on top of that. Has created a lot of incremental demand for single name short capacity as have the style baskets. The combination of that plus the rise of the retail meme trader have presented new challenges. Practically what that's meant is we remain as dedicated to single name short selling as ever, but we've had to diversify the portfolio. There was a time when I probably would have preferred to short with more concentration. Bigger positions really extract a lot of alpha through slugging, but the volatility, the short-term reaction function when you get something wrong on the short side can be so much more severe now, and then the rise of the retail meme type risk is not something that you can easily mitigate even through sizing. So for us, what that has principally meant is we've grown our team. We've created more research bandwidth, That in turn has allowed us to create more inventory of actionable, single name, short ideas. And …

AI assessment note: “what that has principally meant is we've grown our team... diversify the book more”

Q What are some of the characteristics of those inefficiencies that you found repeat over time?

A For us, our taxonomy, if you will, really breaks sources of inefficiency into three principal buckets. What we call structural sources of inefficiency, behavioral, and then informational. And within each of those buckets, there's probably seven to 10 different fact patterns that we might consider. So for instance, structural sources of inefficiency are going to be quite tangible. Chances are you'll read about them in a research report or hear about them on a conference call or even See them in the newspaper. They're going to be things like corporate actions, spins, divestitures, restructuring, M&A, changes in management, judicial or regulatory decisions, but what they all have in common is that up till a certain point in time, the market was using a fact pattern to discount those securities, and now something has happened, and it's rendered that fact pattern obsolete or inoperable. Maybe it's permanent, maybe it's temporary, But perhaps there's an entry there to create a new fact pattern through the research process. Informational sources of inefficiency will be essentially asymmetric, either availability or understanding of information. So think cross cap structure, credit versus equity, or it could be cross border. How do actors in one market view something versus actor in another market? It can overlap with maybe regulatory Considerations as well. But it's going to be some s…

AI assessment note: “our taxonomy, if you will, really breaks sources of inefficiency into three principal buckets”

Q What have been some of the biggest challenges along the way?

A Gosh, where to begin? Building a team and a culture through a pandemic, not easy. There was a period of time where we weren't in the same room together or the same office, and you're trying to forge your identity, and I give tremendous credit to the professionalism of the team. I think it would have been easy for a lot of newer firms to splinter, and instead we came together and built our identity and our culture and That certainly was a challenge early on. I think continuing to build those partner relationships and giving transparency into our process through the ups and downs, because it hasn't been all up and to the right. We went through a period of underperformance in mid-twenty-two where we had a drawdown, and just managing through that, that's for sure been the most challenging aspect. The drawdown itself wasn't out of line with what you would consider maybe for a strategy like ours, but it still wasn't fun. Like many things in life, you think you have a plan, and then it gets tested, and it's not what you think it is. And we had built our risk posture in the spring of 22 for probably four to five percent inflation, but not 10. To my point about concentration earlier, that was the one time when it worked against us. And so empirically, we had to navigate through that period and reset the portfolio and manage risk. And I think one of the things that came out of that in a …

AI assessment note: “We went through a period of underperformance in mid-twenty-two where we had a drawdown”

Q Yeah, great. What reading do you almost never miss?

A So reading is just truly one of my passions. I'm one of these people that at any given point in time is reading five or six different books. You know, there's something on my nightstand, something in my office at home, on my Kindle for when I'm commuting, that kind of thing. When I think about our business, really the one thing that I try not to miss is Mike Semblist at J.P. Morgan's private bank. They put out a piece when they feel like it, so it's not on a regular interval called Eye on the Market, and I just think he and his team do a really great job in Five or six pages of distilling key issues and making it very accessible. I actually really try to make time in my reading for fiction, because I find that it relaxes me and it accesses a different part of my brain, and so a lot of my creativity and insights come from when I'm reading fiction. And then I also just love to read, kind of going back to some of the comments earlier about Coach K or David McCullough, anytime you can find someone who's willing to talk about their craft, I love it, and so right now, for instance, I'm reading, um, Stephen King has a book that he wrote called On Writing a number of years ago, where he really talks through his development of a writer, and then how he applies his craft, and it's just fascinating.

AI assessment note: “really the one thing that I try not to miss is Mike Semblist”

Q And along the way, did you have important mentors, and what did they teach you?

A I've had so many mentors, and in fact, I can't even overstate the importance of having great mentors. Seeking them out. You have to seek out mentors. At some point as you go through your career, you'll actually outgrow some of your mentors, and that's okay, but you have to find new ones. And so when I think about some of the people that I've been exposed to, whether it was my early job at Merrill, someone, one of my senior bankers, Greg Margulies, Greg taught me the credit skill set, and he really made me think at a young age as opposed to just process. And I saw him take very principled stands on things like extending credit when there were a lot of external pressures. Obviously, I mentioned someone like Jim or David Bonderman. You know, we'd spend months in the trenches on a buyout trying to figure out what mattered, and then you'd put that work in front of them, and they'd go through all that work and figure out in about an hour what it took you six months to figure out, and that was the experience. I mentioned Frank and Keon at Hawkshaw. A real process orientation, depth of research, and so on, and so one of my former partners at Blue Mountain is Jess Staley, who's now the CEO of Barclays, and just a fantastic person, just the highest integrity, and so surrounding yourself with very high integrity people who can push you, teach you, is essential.

AI assessment note: “Greg Margulies, Greg taught me the credit skill set, and he really made me think”

Q What have you found the different decision points of when to dive in to decide whether you're going to spend your time analyzing something when you have such a broad canvas to look?

A Another key learning that I've experienced in my career is that when you think about the analyst job from identifying to breaking down a business to ultimately monetizing it, most spend far too much time analyzing and trying to monetize at the expense of really identifying effective setups. Ultimately, what we have found is that getting the setup right is really where you get the most leverage to a positive outcome. So once we find something that we think is inefficient, we have a battery of questions that we ask. What's the nature of the inefficiency? How tangible is it? What will it take the market to potentially realize it and remove that inefficiency? We're very focused on the credit mindset, which is to say, what is my downside risk? Return of capital before return on capital. We are really screening the idea upfront for suitability to our process, for potential asymmetry of return, For low risk of capital loss, and then asking ourselves, hey, if we spend a lot of time on this, what's the likelihood that we can actually differentiate ourselves through our research, and then put it in a portfolio and make money from it?

AI assessment note: “we have a battery of questions that we ask. What's the nature of the inefficiency?”

Q You mentioned at the onset that just the fundamentals aren't driving securities the way they used to. How do you think about how to monetize the fundamental work that you've done?

A When we think about monetization, there's the old saying that there's a big difference between finding a security that's mispriced and actually making money from it. And this is an area where I think we and just about everyone have really had to evolve your process over the last several years because markets have become increasingly efficient in many ways at defining expectations and calling quarters. A lot of that has to do with the rise of the platform model where these are very smart people with a lot of resources. So for us, what that's meant is First and foremost, placing an even higher emphasis on the concept of inefficiency, and in particular, doing it in places where we think we have less competition and where it's harder for the market mechanism to be as efficient around what those expectations are. So typically what that means is situations where there aren't expectations to begin with that are well-defined, where we're not playing head-to-head Against the platform or other participants, but it also has meant being able to tolerate more volatility, candidly, and knowing that our fundamental underwriting, our ability to define distributions of outcomes, good and bad, more accurately, and then sizing to those outcomes in an effective manner has become really important. Ultimately, in our process, concentration is our lifeblood. We have our highest hit rates and our high…

AI assessment note: “First and foremost, placing an even higher emphasis on the concept of inefficiency”

Q So those relationships often take time to build. When you're starting, you actually need capital to manage to be around for when those relationships may turn your way. How did that play out in the early years?

A Blackstone anchored our partnership from day one and they've been fantastic partners. And I think that played a critical role in allowing us to put that stake in the ground and say, this is who we're going to be from day one and not succumbing to what I think a lot of managers are forced to adapt or modify their strategy to do things they don't want to do early in their life in order to raise capital. We didn't have to do any of that because we had a very strong anchor And then we were fortunate to be able to partner with some other very thoughtful, stable sources of capital who will partner early in the lifespan of a manager and who are able to allow us to do what we do. And then there's serendipity involved. There's a lot of luck that's involved, but you have to perform. And so we were fortunate enough not just to be able to perform, but to perform in a laboratory that was pretty rich for how we want to invest. The onset of the pandemic And its immediate aftermath while challenging to navigate. And I think that gave us a lot of proof of concept to folks who we were building relationships with to then allow us to continue to scale in the ensuing years.

AI assessment note: “Blackstone anchored our partnership from day one and they've been fantastic partners.”

Q So if you look out six years from now, and we sit down to do this again, what are you hoping Parsifal will become?

A We've always wanted to be in the IRR club, so my hope will have been that we've distinguished ourselves through very strong performance that's diversifying for our partners and has helped them reach and achieve their end objectives. Along the way, I hope that we've continued to build out and promote from within a very talented team and a team and culture that is self-perpetuating. In many respects, the Achilles heel of organizations like ours is the key man risks that Sips with someone like myself. I've always been very open about that, both internally and externally, that for Parsifal to thrive and succeed means that I have to make myself redundant over time. I need to attract the best talent possible, groom that talent, put those individuals in positions of more success and responsibility over time, ensure that our process is not between the ears of just one or two people every day, but is really a self A perpetuating process of how we execute. So I think if in five or six years we've been able to continue to perform in the way that we expect of ourselves to meet our partner's objectives, and I've been able to make myself much more redundant, I think we'll all be in a happy place as a result.

AI assessment note: “my hope will have been that we've distinguished ourselves through very strong performance”

Q When you last came on the show, you were three months pre-launch, and now you're still here six years later. So why don't you give me just the highest level where you are today?

A I went back and looked at it. I think when we did the live talk at Columbia, it was the day after Valentine's Day, 2019. So it's almost exactly six years to the day since we did that. I don't think any of us could have imagined what would transpire in the world during that time. But I'm happy to report that the things that we talked about at that time in terms of the vision and what we were hoping to do with launching Parsifal have played out really beyond our expectations, all the goals that we would have had for ourself. For the most part, we've met or exceeded, and as we sit today, we have a fantastic team that has executed really well, and we've built a firm that manages about a billion and a half dollars of capital. It's been a really interesting, if not challenging, and trying time to be in the public markets, but we've relished the opportunity, and it's been a really fun ride.

AI assessment note: “we've built a firm that manages about a billion and a half dollars of capital.”

Q And how do you balance those two? So something isn't going well, what do you do with that position?

A First, you lean on the value of the process. So the value of our process in documenting every step of it, what we thought we were signing up to, what we thought we were underwriting, the key assumptions, that now gives you a reference point to go back and say, hey, is what we thought would happen playing out, or is something different playing out? If what we thought was playing out is playing out, and we're still not getting rewarded in the way we thought, then we need to ask, well, does the market actually care about something else or not? Separately, if what we thought should be playing out is not playing out, then we need to go back and actually reexamine the root cause. But time and time again, I've seen in my career, when you think that you're right and the market is wrong, the market is almost always right in the end, and you need to go back and fundamentally revisit Your entire thesis and the premise for what you were doing and not ignore that signal.

AI assessment note: “you need to go back and fundamentally revisit Your entire thesis”

Q So I'd love to start parsing through what strategy have you settled in on for how you're managing the capital?

A We know that based on very significant bodies of research that has been replicated over and over again, that there is a combination of strategies or factors, if you will, that do drive replicable, scalable alpha. And basically strategies that do three things over time really outperform. And those three things are invest with high active share. So you don't, by definition, look like an index. Second, concentrate in your best ideas in recognition of the fact that actually markets are reasonably efficient most of the time, more so than most people like me want to admit day in and day out, and therefore when you find something that you can have a superior understanding of, you take risk to it. The third is being able to invest with appropriate duration and volatility tolerance that is consistent with your strategy, and the reason that the excess returns Exist in that model is because it's very hard to create those three factors. It's basically business model alpha. As a manager, I can control my active share and my concentration, but if I can't find partners who are willing to align themselves with it through the cycle, good and bad, and stick with it, it's very hard to do. In competitive capital markets, the most sophisticated and thoughtful allocators have a lot of competition for their capital. It's hard to find those partners and build those relationships, and it's particularly…

AI assessment note: “invest with high active share... concentrate in your best ideas... appropriate duration”

Q What you have in your portfolio is equities long and short, credit, some event-driven situations. I'd love to go through each and talk about some of the challenges that the markets have brought up. We can start with equity longs. Have you navigated this strength of the MAG-SEVEN?

A It's been tricky. We ply our trade in small to mid cap parts of the market. We are global, and we are looking for more complex situations, and the unusual nature of the current business cycle has been reasonably hostile, actually, to all of those. It's the job of any manager to adapt to that, but the kinds of things that we like to do have been more out of favor And what we've seen is that the rise and dominance of mag seven has led to a real bifurcation of markets and opportunity sets. The rise of mag seven is really distorted bottoms up investment outcomes and decision making. It's distorted. I think allocator and behaviors for us, what that's meant is just staying true to our strategy, knowing that we can identify opportunities and With conviction and not succumbing to being forced into the mag seven trade. What's so insidious, I think about what is potentially going on and having lived through this in the late nineties with.com is the concentration of that kind of performance. And so few securities, it really will ignite fear of missing out or fear of lagging. And eventually it will cause people to make bad decisions. The most important thing has been staying true to our process because we know it works really well over time. Taking the opportunities as they're given to us, identifying opportunities that we think will thrive in that environment. And in general, we've adapte…

AI assessment note: “for us, what that's meant is just staying true to our strategy”

Q Why do you think that percentage of the hit rate of the slugging percentage has been that high?

A It goes back to really what we discussed earlier, which is we have a very specific rubric that we're looking to populate. So inefficiency that we can exploit, Very asymmetric, low risk of permanent capital loss, high degree of research ability that we can build conviction, and then specific catalysts. And when that fact pattern comes together, our underlying portfolio construction algorithm says, be big in this now. So it's really just about being patient and waiting effectively for a fat pitch that we can elucidate very clearly, check all the boxes, Maybe another way of saying it, it's usually not the case that something comes into the book in like that smaller part of the sizing and then scales up over time. It happens. It's usually where we come across a fact pattern that is so compelling that we want to be big from the get-go.

AI assessment note: “being patient and waiting effectively for a fat pitch that we can elucidate very clearly”

Q When you're trying to canvas the investment landscape globally across the capital structure, and you need to build a team that probably doesn't have your level of experience in doing that, how do you think about acquiring the right talent?

A I think talent acquisition management is the cornerstone of investment management because ours is a human capital business. Your assets ride the elevator every day, so to speak, and so getting it right is essential. And the hardest part is not finding smart people. Everyone in this room is smart. Lots of smart people are walking up and down the street. The hardest part is finding kind of the people have the intangibles in their head, and, and so what do we worry about, or what are we trying to find? Well, we're trying to find people who have a certain work ethic, and so, you know, when I was at Duke, I was fortunate enough to be able to have a small group lunch with Coach K. He did this a couple times a year. It was almost like a lottery system, a couple students. You'd go to Cameron, have lunch with him, and he would talk about his philosophy, and one of the things he said really resonated with me. He said, when we go out to meet kids, when we go out to recruit them, we're looking for kids who are their own harshest self-critics. We want kids who are simply more demanding of themselves than we, as coaches, the university, their parents, can be. And that always resonated with me. I, I think I have some attributes to that, and so in working with people and building my own teams, I've always looked for people, first and foremost, who simply demand more of themselves than I or any…

AI assessment note: “I've always looked for people, first and foremost, who simply demand more of themselves”

Q As you distill everything you've learned from your career, and now you're on your own, and you can set the table as you want, what beliefs do you have about investing that drive the investment philosophy of Parsifal?

A Yeah. You know, we're all kind of the sum product of our experiences, and at this point in my career, one of my most deeply held convictions, and really the cornerstone, one of the couple cornerstones for what we're doing at Parsifal is this. I think the institutionalization of alternatives, it's been great for alternatives, like, let's make no mistake about it, it's been good for me and for many of the people in this room. I don't think it's been good at all for returns. And the reason is, as we've institutionalized, we've put managers in narrower and narrower boxes in terms of what we'll allow them to do, and we've given them very strong financial incentives. And when you put someone in a box and pay them a lot to do something, they're going to do it, and they're going to make bad decisions along the way. So if you think about certain strategies, and I don't want to pick on any one strategy, but there are just certain strategies out there That they're good one or two out of 10 years. And the rest of the time, they're not to be trifled with. But when you say to someone, hey, you're a dedicated manager in that strategy, they somehow find something to do all the time everywhere in the world. And so one of my deeply held convictions, and when I look at the managers who I identify the most with over my career, they all make money in very different ways, but what they all have in c…

AI assessment note: “really the cornerstone, one of the couple cornerstones for what we're doing at Parsifal”

Q How much of that comes from nature versus nurture?

A I think one of my biggest weaknesses and biggest strengths that's just two sides of the same coin is I'm a very patient person. I don't know why that is. It's definitely nature. Maybe it's a little bit of nurture. I guess, you know, maybe it's being a Z in an alphabetical world. I went to a grade school that was modeled off the British form system, and they literally did everything alphabetically there. So for the vast majority of everything that happened during my formative years, I was last. Except for when it really mattered, like a book report or something, then they'd start at the back of the alphabet, invariably, and I'd get cheated on the other end. And so, for better or for worse, I've always been willing to play the long game in life, in different situations, thinking about my career, and what that helped orient me with early on is that investing is really an apprenticeship business. There's just no doubt about that in my mind. Of course, there are outliers where we can observe people at a very young age succeeding in our business, But for the most part, I think this is a business where you just have to be around for a while. You have to see different situations, see different markets, break some eggs, make mistakes. And so I've always tried to just keep that long view in mind. And you know, when I think about some of the more formative experiences, let me share a coup…

AI assessment note: “It's definitely nature. Maybe it's a little bit of nurture.”

Q It seems a bit different than many to have spanned credit, private equity LBOs. You come here, you then go public equity on the short side, long short. Was that planned from the beginning?

A No, not necessarily. It wasn't planned. I love learning new things, so for me, kind of the juice in what I do more than anything is learning. Investing really is learning for me. I think if you were to talk to people I've worked with or people who've worked for me over the years and say, hey, what's Dave's style like? What is he like as an investor? I think what you'd hear universally is he asks lots of questions. My style is to ask lots of questions, to really drill down. Questions beget questions. That's how I learn, process information, At the end of the day, I think it's a pretty effective way to distill the essence of what we do and don't know, and so I love that process. I love doing research. One look at me, I'm not going to fool anyone in this audience. I'm not exactly an endurance athlete. I have yet to experience the so-called runner's high in my life. I've experienced a lot of other things running, but this euphoric high is not one of them, but I get a huge amount of, like, pleasure, satisfaction from doing research, from sitting, thinking, And so, that's how I've modeled my career, is to put myself in a position to do that. In college, I actually did two majors. I did econ. The precision of that, the social sciences, the real world applicability appeals to one side of my brain. But I also majored in something sort of more esoteric, which is called medieval and renai…

AI assessment note: “No, not necessarily. It wasn't planned. I love learning new things”

Q When you take that combination of that concentrated approach with an opportunistic flavor, and you mentioned that the opportunities are transient, how do you go about identifying the opportunities that you want to pursue in this concentrated way?

A We break our process day to day down into three functional areas. One of which you just named, identifying. We have to be able to replicably and reliably identify opportunity. We then have to be able to analyze them, and then in turn, monetize them. And those are three very different skill sets and processes. But the lifeblood of what we do is a maniacal focus on the concept of inefficiency. Whereas I think most managers probably define their search strategy along either Some sort of valuation access. So I'm a value manager, I'm a growth manager, I'm a quality manager, or some sort of qualitative aspect. I want to invest in great management teams or great capital allocators or compounders or something else. We care a lot about all those characteristics and many others, but that's not where we think about identifying new ideas. If our task is to generate alpha on some sort of replicable basis, then it seems pretty obvious to me that we have to first start by Focusing in on places where there's a higher probability that a pool of alpha exists. So as a team, we spend our days asking ourselves, why do securities tend to get mispriced by the capital markets? Do these sources of mispricings recur? Can we identify them on an ex ante basis? Can we exploit them through our process? And when I reflect on my career to date, Ted, I think this has been one of the most impactful Realizations…

AI assessment note: “the lifeblood of what we do is a maniacal focus on the concept of inefficiency”

Q You mentioned the word outgrowing mentors in there. How do you know when you've outgrown a mentor, and what do you do about it?

A If you have good mentors, they'll tell you when you've outgrown them. They'll acknowledge, Dave, you know, I've taught you what I can teach you, now go forth. Or you'll come to them and seek their wisdom, and they'll say, I, I can't help you on this one, but I know someone who can. And so, I think it comes from a strength and security in that relationship. And in some respects, really good mentor-mentee relationships are bilateral, and so there's a long list of people who have influenced me, and I really should have pointed out my parents above all, actually. At some point in most of these relationships, sometimes they come back on each other, and you end up helping and mentoring them as well.

AI assessment note: “If you have good mentors, they'll tell you when you've outgrown them.”

Q What are the types of things that have those characteristics?

A For us, it's the inefficiency, so maybe I can give you an example that will crystallize this. When you transition from analyst to portfolio manager, it's a big and often difficult transition, but one of the most important things that you learn is, as an analyst, your job is to know everything there is about an idea, and when your idea is not playing out the way you want, the temptation is to say, I'm right, and the market is wrong. What you learn as a portfolio manager is actually, no, the market is usually right, And that you've got a problem, and you need to go back and test. So that's usually the concept I'm trying to bring out.

AI assessment note: “so maybe I can give you an example that will crystallize this”