Dan Sundheim, founder of D1 Capital Partners, discusses his recruitment strategy and talent development philosophy with Daniel Gross and John Collison.
Assertion Not checkable as stated
Sundheim: Chinese tech firms avoided beating earnings to dodge scrutiny
“For a while we were seeing Chinese internet companies, like, they didn't want to beat earnings. Because if you beat earnings, your stock goes up too much. You know, you might be flagging that, like, you're over-earning”
Opinion
Sundheim: Nvidia is not expensive and public AI stocks aren't in a bubble
“I would tell you, like, NVIDIA is, we can have a debate about what the earnings are going to be in a few years but it's not expensive.
Like, NVIDIA trades at twenty-something times multiple.
that's, you know, I think within reason, and I don't think there's…”
Insight
Sundheim: The biggest investing mistakes come from selling great compounders too early
“The biggest mistakes are selling the Costco's too early, because you know, the IRR is totally dependent upon what you assume the exit multiple is, like, and that is difficult to be precise about, you know, what the right exit multiple is for a business.”
Insight
Sundheim: Private market illiquidity is a huge benefit for holding great companies
“That's the nice thing about the private markets is that Once you invest, you can't sell, and usually for the best companies, that's a huge benefit ultimately.”
Assertion Not checkable as stated
Sundheim: Hiring lateral portfolio managers from other funds almost never succeeds
“If I hire somebody laterally, who's a portfolio manager in another fund, that's rarely been successful, almost, almost never.”
Insight
Sundheim: Managing risk after a position moves destroys capital
“Risk management cannot happen after the fact. Like, anything you do after the fact is not risk management. It's actually just destroying capital. Risk management has to happen before the fact. Meaning, like, you size these positions so that, like, When it goes…”