André Perold – Investing Through Exponential Change

André Perold (0:00)

You're seeing companies with extraordinary earnings growth, high valuations.

We're seeing venture investments in the many billions, 20 billion value, 5 billion before. How do you decide those? How do you think about investing in a world where the underlying fundamentals are changing very quickly, but the price is very high? If the price was low, would you believe it was changing? Because the price is high, it's consistent with things going really well. When the price is high, you always recoil.

Part of you needs to say something like AI is going to work. 10 years from now, we'll be in a world we won't recognize. May not be the case, that's possible. Maybe only half of that's possible, it's still profound. Maybe only a quarter is possible, it's still profound. If I think that's true, it means that I need to think long-term and be comfortable owning things at high prices, knowing that in any normal investment environment, you'd never own them because this is different. Those are the most dangerous words in investing is saying this time is different, but this time is different.

Ted Seides (1:20)

I'm Ted Seides and this is Capital Allocators.

My guest on today's show is André Perold, the co-founder and Chief Investment Officer of HighVista Strategies, an alternative asset manager overseeing $14 billion that searches for alpha opportunities in structurally inefficient markets. André has twice been a past guest on the show, starting way back with episode number two. And both conversations are replayed on the feed. This time around, we start with André's assessment of the most exciting and unusual investment environment he's experienced, alongside his thoughts on how to build capabilities and construct portfolios to navigate exponential change. We then turn to the beautifully inefficient markets where HighVista has built core capabilities across biotech, lower middle market buyouts, early stage venture, and specialty private credit.

SPEAKER_3 (2:18)

Before we get to the interview, we spend a lot of time on this podcast asking other people questions. This time, we're turning the tables on you.

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Ted Seides (2:38)

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Please enjoy my conversation with André Perold.

André, great to see you.

André Perold (5:43)

Great to be here, Ted.

Ted Seides (5:44)

Been a little while since you were on the show. I'd love you to catch me up with how you're thinking about the investment landscape.