Hale: Activist ideas are almost never novel to internal company employees
Rob Hale · Mason Morfit and Rob Hale – Quiet Activism at ValueAct (EP.462) · Sep 29, 2025 · at 1:03:45
Rob Hale, co-CEO of ValueAct Capital, describes how activist value creation relies on empowering internal ideas rather than external genius.
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“Usually when we're investing in a company, there are a lot of people inside the company who see the exact same opportunity that we see. It's almost never the case that we have some idea that nobody in the company has ever thought of.”
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“If you're a steel company or an airliner and you're in some commodity industry and you misallocate capital for 10 years, you go bankrupt. Someone takes you over. If you're Microsoft, if you're Adobe, if you have a very strong franchise and you don't necessaril…”
Hale: Rebuilding cost structures from zero base beats relying on 10-Ks
“That analysis of let's just ignore what you see in the 10 K. Let's just build up zero base. What does this business cost structure look like? That is by far, I think the most important exercise that we do early in our due diligence process.”
Hale: Japan ranks second globally for high-margin billion-dollar public companies
“The number one market Is the U S with about a thousand companies with over a billion market cap and above 40% gross margins. The number two market is Japan with 250. After that, you get to numbers around 50 to a hundred in countries in Europe.”
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“One thing that we've learned to focus on is when you hear yes, you always have to ask yes when, because yes can mean yes, but in 10 years after I've retired, and you want to make sure that that's not the source of the misunderstanding.”