Brad Gerstner and Rich Barton – Thriving in Changing Markets

**Patrick O'Shaughnessy** (0:00)
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Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, methods, stories, and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfieldguide.com.

**SPEAKER_2** (1:39)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (2:03)
My guests today are Rich Barton and Brad Gerstner. Brad is the founder of Altimeter Capital and is one of my favorite active investors. Brad and Altimeter are one of the largest investors in Snowflake in its earlier days and continue to invest in iconic modern businesses with an extreme focus. Rich has one of the most impressive resumes in the business world. He founded Expedia, Glassdoor and Zillow. He's a longtime Netflix board member since before they went public. He's a venture partner at Benchmark Capital and he gives back through the Barton Family Foundation. Our conversation covers Rich's power to the people strategy, Brad and Rich's perspective on taking companies public through SPACs versus IPOs and their perspectives on how to build a great company. This one is so fun, we even discuss how to come up with company names, talk about the importance of The Wizard of Oz and explore the importance of big hairy audacious goals.
I really enjoyed this conversation with two of the smartest people I know and I hope you will too.
So Brad and Rich, we're going to cover a lot of different ground, but we have to begin with how you two know each other. Who wants to begin with the story of how you guys met?

**Rich Barton** (3:06)
I'll bet it's like Roshamon, I bet it's two different versions. Hey Patrick, this voice is Rich.
Maybe Brad, you go first.

**Brad Gerstner** (3:14)
Rich and I met in 1999
I was helping David Fialco and Joel Cutler do their first pre-general catalyst deal in Boston. It was an online travel deal. I was at business school and Rich had started Expedia and we ended up building a platform that was a little bit of Shopify meets online travel. We were building booking engines for cruises and vacation packages, which really hadn't been done yet. So we ran part of Expedia's business on an outsourced basis for them and Expedia was taking off. In pretty short order, Rich decided that this was going to be important to his business and so decided that perhaps they ought to buy this company and make it part of Expedia, which launches down an 18-month odyssey where Barry Diller led by his head of M&A, Dharakasar Shahi, would end up buying both businesses.

**Patrick O'Shaughnessy** (4:08)
What's your version, Rich?

**Rich Barton** (4:10)
That's kind of it. It was pretty dramatic though, Patrick, because while that deal for Expedia to buy NLG, while that was happening, that negotiation and deal was happening, two really wild things happened. One was Barry Diller bidding to buy Expedia, so Expedia in an M&A process for Diller to purchase Expedia, which was then a public company, and take it private. Then the second thing that happened during this negotiation was 9-11.