Brad Gerstner – Public and Private Investing

**Patrick O'Shaughnessy** (0:00)
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**Patrick O'Shaughnessy** (1:08)
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_3** (1:28)
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** (1:53)
My guest today is Brad Gerstner, the founder and CIO of Altimeter Capital, a multi-billion dollar technology-focused investment firm. Brad and his team are known for a deep expertise in internet-enabled businesses, including Expedia, Facebook, Uber and many more. We discussed the evolution of opportunity in this style of investing, including the important shift to private investing, where so much of the value creation now happens.
I won't soon forget our discussion of consumer intent on the internet and how it shifted, the role that essentialism plays in Brad's business and life and the rise of the Chinese internet giants like Bytedance. Please enjoy this great conversation with Brad Gerstner.
So Brad, this has got to have been one of the most interesting investing periods of your career. I'd love to begin by giving the audience some perspective on your overall investment philosophy. We're gonna talk about lots of private and public investing, some of the businesses you founded, life in general, but I'd love to begin with just an overarching investment philosophy that you hold out for Altimeter.

**Brad Gerstner** (2:54)
First, thanks for having me, Patrick. It's great to be here. I love listening and it's fun to finally get a chance to do it together. I really founded Altimeter in 2008 with a view to invest in the world's best technology companies, both public and private. At the time, I think it was a fairly differentiated view that most LPs were looking for firms to either be venture capital firms or to be hedge funds. They didn't particularly coming out of the depths of 2008, didn't love the idea of a fund that did both. But from my perspective, we always viewed this as more of a throwback fund. It was a way to compound my own capital, do it in partnership with great long-term investors who viewed the future of technology the way we did. Our objective is to find terrific companies that can be multi-year compounders in secular growth areas that are denning the universe in one way or another. We thought then and we believe even stronger now that a lot of that value creation would occur in the private markets.
So when I started in the venture business back in 99, 2000, a big exit was a couple hundred million dollars or a billion dollar exit. A billion dollar exit to a single venture firm, put them in the hall of fame. But if you look at it today, we have internet companies that are gonna go public after having created $200 billion of equity value in the case of Bytedance or software companies that go public after generating tens of billions of dollars in enterprise value. And so a lot of that value capture has moved to the private markets.
From our perspective, we wanna participate in that value capture in these long-term compounders over the life cycle of the business. And oftentimes companies we invested in in early venture, mid venture rounds, the series B, a series C, we're the largest buyer in the IPO.