The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 15 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Dorsey: Dorsey Passed on CoStar Due to CEO Stock Sales and Misalignment
“The CEO in that case was successful, but for a founder, he largely had sold stock along the way, so he didn't retain a large ownership stake in the company. If all that spend and competing with Zillow didn't work out, shareholders were probably going to suffer…”
Dorsey: Allocators Face Harder Underwriting Than Public Equity Investors
“You can never be too transparent. That's the biggest lesson. I've met investors who won't write about positions. You have to pry information out of them about the companies that they own. Clients don't like that. Somebody investing with you as a manager, they …”
Dorsey: Dorsey Shifted Investment Criteria From 70% Moat to 70% Management
“When Dorsey Asset launched in 2014, I was probably 60, 70 moat and 30 management. So you want to weight things, and I'm probably the reverse today. That's largely because I've seen just how poorly people can behave and how much damage they can do to even a gre…”
Dorsey: High-Return Internal Reinvestment Beats Returning Capital by Lowering Allocation Risks
“If I've got a choice between company A, that is constantly giving me back the money, and then I need to go reinvest it in a super competitive public equity market, or company B, which can plow it back into a 20% return capital internal project, the math is obv…”
Dorsey: Endowments Back Early Managers Because Smaller Fund Sizes Generate Better Returns
“The endowment and foundation community as one that not only doesn't fear concentration, but also is generally more willing to take a bet on people early in their careers because they realize often when you're smaller, that's when the best returns show up.”
Dorsey: Concentrated Investors Cannot Compromise on Business Durability or Management Quality
“The biggest one is you can never set the bar too high in terms of the quality of the business or the quality of the management team. Most of our errors have come from compromising on one of those two, that either we thought this was an A business and it turned…”
Dorsey: Most Fund Stock Sales Stem From Investment Errors, Not Profit-Taking
“Most of our sales have come because we got it wrong. The thesis was wrong. Management did something we didn't expect, or we thought they were better capital allocators than they turned out to be. The bulk of our sales have been driven by errors that we needed …”
Dorsey: Luxury Brand Moats Endure Because Social Signaling Requires Broad Consensus
“If you think about a luxury brand, that's more consensual. I'm not wearing a Rolex because it tells time better. It's because I want people to know I have money. I'm signaling something, but that signal value is only useful if everybody else agrees that a Role…”
Dorsey: Dorsey Asset Management Caps Individual Position Sizes at 15%
“Our max size is 15. There's no magic to that number. That means that maxed out, we'd be about eight stocks. We've historically owned between 10 and 15. Fifteen's a hard number, one in, one out.”
Dorsey: Executives Speaking as if They Own the Company Signals Severe Misalignment
“If managers talk about the company as if it's them, as if they own the company, instead of owning a half a percent of it via options, which is usually the case, that's usually a bad sign, because that means they're more aligned with themselves than with extern…”
Dorsey: Portfolio Managers Must Have Personal Comfort With Every Holding
“Sometimes it's the personal comfort level, because at the end of the day, when the numbers are flashing red and the news is bad, I've got to make a decision. That's my job. If I don't have a good feeling about the business, if there's something nagging at me a…”
Dorsey: B2B Moats Are Easier to Validate via Customer Interviews Than Consumer Brands
“B to B businesses, you can talk to a dozen customers, and if you get a similar story about the value of the product or service, you can be confident that you're going down the right track. Consumers, you would need to do larger surveys, larger sample sets, and…”
Dorsey: Dorsey Asset Management Uses Valuation Multiples Backed by DCFs
“Today, we
Tend to use multiples as our primary touchstone and do a three-stage DCF as a backup to see where there are differences.”
Dorsey: ASML Is Dorsey Asset Management's Largest Portfolio Position
“Our largest position right now is ASML, a monopoly in a key part of the semiconductor value chain.”
Dorsey: Offline Q&A on Investment Memos Makes Live Research Meetings More Robust
“We tend to do a lot of offline Q&A on memos because I find that it makes the meeting more robust and more discursive and more of a back and forth because you're not asking, oh, I didn't see what segment margins are for that thing. What was that write off in 20…”