Dialogue. Denied Allegations, Adobe Update, & Multiples in Growth Investing

Alex (0:06)

Welcome to The Synopsis, a business and investing podcast. Your host, Alex, is back, and we are talking with none other than Drew. This is the only person I talk to. Drew sometimes talks to other people. I don't talk to anyone else other than Drew.

I'm a committed guy, that's all I'm gonna say.

Drew Cohen (0:24)

And you're someone who apparently, I think, has been seeding some synonymous comments in the Spotify to get your position as host solidified.

Alex (0:33)

Oh, really? So when people throw a little compliment my way, it's got to be a burner account? Is that what you're insinuating from some nice comments I've been getting? Is that the direction you want to take?

Drew Cohen (0:43)

Well, first of all, it's not plural, it's singular.

And here's the comment though, it was pretty extreme, I'm not gonna lie. Thanks for the podcast, Drew. Help me get to sleep last night, lol.

Bring back Alex, give the people what they want. Alex is entertaining and has ASMR voice. Alex is the heart and soul of the podcast, and you know it. You're gonna tell me you didn't write that?

Alex (1:05)

First of all, I want to say that guy, smartest guy I've ever heard, well-written, articulate, I bet he's doing really well in life, whoever that is. That's all I'm gonna say about there. I think it's very successful. Drew can put people to sleep without my vibrant hosting, so you're welcome. Just a great point all around, and I think we should leave it there. I think he's a smart guy.

And I deny the allegations. I deny the allegations.

Drew Cohen (1:30)

Okay. All right. Well, if you're gonna deny him, then I guess there's no way we could possibly trace who's Spotify 8708 user is.

Alex (1:38)

I'm gonna deny it vehemently, and that's all I'm gonna say. I'm gonna leave it there. And smart guy, I hope he does well in life. Now, let's get into what we're actually talking about here, which is not my remarkable hosting that is loved by all. We're talking today about a couple of videos you put out regarding multiples, a fun topic. They get pretty mathy, so I'm not gonna spend too much time on them. I think you illustrate them well, and I do think the video is important.

But quickly on that, you did post a new location in a video. You were one, had an Excel screen pulled up, and you were a little boxing, so that was a new format. And secondly, you were in a whole new background, which I think people are finding quite exciting. So, what do you have to say about this new background, Drew? Is this going to be a regular new background for you, or are we going to go back to the bookshelf?

Drew Cohen (2:25)

Not putting people to sleep anymore, am I?

Alex (2:28)

Yeah, I mean, you know, normally you want 300 to 400 books behind you, so people know that you've at least owned them, but I didn't see any books behind you in this one. So, I don't know if people can infer that you've read anything in your life without the books behind you.

Drew Cohen (2:42)

That's a fair point. I have a very small book stack in the corner. That's just Speedwell Research books.

Alex (2:47)

So, I don't know, Drew, I don't know if you want to keep that, but I kid. All right, let's get serious here. We've been joking around too much. So, talking multiples. Oh, those were jokes?

Yeah, thank you. All right. You know, that's a final joke of the podcast right there. We're done here. So, let's get into our multiple discussion. Again, I think compelling. I want to talk about the one where you talked about kind of the growth multiples, right? So, we talk about companies, I don't know, Snowflake, Palantir, anything trading at, we'll call it a revenue multiple on the public markets. And we spoke about this previously, which is I don't like people putting categories, growth, quality, et cetera. But people paying, we'll say, revenue multiples, normally would not be in the Buffett-Monger camp, right? Because normally that would be considered ludicrous, overly expensive. How can you extrapolate so much growth out into the future? It's irresponsible. And you push back on that and saying, look, a very reasonable person or subset of people, I mean, obviously, there's a highly intelligent people investing in all these companies. And you come at it from the perspective of, OK, if I'm a highly intelligent person, I'm investing in a 40 revenue multiple company.

What am I thinking? And how can I not just, you know, discredit that company as uninvestable based on the valuation? And I think you did a great job of taking us through that.