Four Pillars, One Framework with Sean Westropp, Founder and Portfolio Manager at Deep Sail Capital

Robert Kraft (0:00)

Welcome to the Planet MicroCap Podcast, the number one destination for everything MicroCap Investing. I'm your host, Robert Kraft, and each week I sit down with elite investors, CEOs and market experts to uncover actionable insights and real world lessons you can apply immediately. Are you a new or experienced MicroCap Investor? Do you want to meet MicroCap Management teams as well as other MicroCap Investors from around the world? Planet MicroCap hosts the highest quality in-person MicroCap events in North America. The mission is to bring the best MicroCap Investors, companies and allocators together to gather, connect and grow. Visit planetmicrocap.com to learn more about our Las Vegas and Toronto events. Now, a quick disclaimer. This presentation is for informational purposes only and should not be construed as a recommendation to purchase or sell any security referenced herein. Planet MicroCap Holdings LLC and MicroCap Club LLC are not licensed brokers nor registered investment advisors. We, our partners, contractors, members, subscribers, guests or affiliates, may or may not hold positions in one or more of the securities mentioned in this presentation and may trade in such securities at any time. We may have received cash compensation from one or more participants for presenting at past, present or future events. We recommend you consult a licensed investment advisor, broker or legal counsel before purchasing or selling any securities referenced in this presentation.

In this episode of the Planet MicroCap Podcast, I spoke with Sean Westropp, founder and portfolio manager at Deep Sail Capital, to dig into his four pillars framework for finding exceptional growth companies and why running both sides of the book makes him a sharper, long investor.

We break down how we balance his quality, management, growth prospects and valuation across a portfolio split between emerging and established growth names, why outstanding management is the one pillar he refuses to compromise on and what the 2022 drawdown permanently changed about how he manages a portfolio.

We also get into his criteria for shorting in MicroCap, why defense has been his best performing sector and the hard lessons on headline risk. We mentioned a number of names during our conversation here today. By names, I mean companies, and I am not a shareholder in any of them. With that, please enjoy my conversation with Sean Westropp. Sean, thank you for joining me today. How are you doing, Doug?

Sean Westropp (2:08)

Yeah. Thanks, Robert. Thanks for body. Thanks for having me on. This is great.

I'm an avid listener. I do want to say the Vegas conference, Planet MicroCap was some of the, I mean, it was the best conference I'd ever been in MicroCap. So you get to do an excellent job. And I know you were running around like crazy, man, just trying to get people to connect with people and get everything worked out. So great work there. I look forward to Toronto.

Robert Kraft (2:38)

Heck yeah, dude. No, thank you, man. That's super kind of you. And I didn't even have to pay to say that, dude. That's-

Sean Westropp (2:43)

Yeah, no, it was really good. Don't worry. I've been talking you up to folks in the industry.

Robert Kraft (2:48)

Gotta get to that Toronto. Thanks, man. Yeah, no, we're excited about Toronto too, man. It's going to be, we like to think of it as a kind of our metropolitan event. Vegas is our destination wedding, and then Toronto is like, it's our city event. And so we're excited to highlight everything going on up there.

We love our friends in Canada. We love to highlight Canada. We have a few US names coming up too, but we're stoked to showcase all the hidden gems.

Sean Westropp (3:20)

Yeah, I own a few Canadian companies myself. So I saw they'll be there. So I'm excited to see them as well.

Robert Kraft (3:28)

Very cool. Well, listen, this has been a long time coming. I said, there's a few interviews I've said that recently. And with you, this is most definitely, I mean, I've been following Deep Sail for years now. I mean, I knew you when you were anonymous. We were joking about that just off line a second ago. Now you're everywhere.

And so, I appreciate you taking the time to come on here and talk a little further about Deep Sail, all that good stuff. So, I mean, let's kick it off with your background. I mean, tell us a little bit about how you got your start, what attracted you, MicroCaps launching Deep Sail, deciding not to be anonymous anymore. You know, love to hear about that.

Sean Westropp (4:06)

Yeah, so for a lot of years, I was LS value on Twitter, anonymous. That was before I even, I think, started a, and I had a predecessor fund to Deep Sail Capital that I ran from about 2013-14 up until I launched Deep Sail Capital on 2022 So, but background on me, and then I'll get into Deep Sail a little bit more. So, I've always been really, really into stock and investing public markets. I opened my, I was lucky enough to have a father that was, that helped me along and he helped me open a brokerage account when I was about 15 This was in the 90s. So, it was kind of like new, newer to everyone, but it was also new to me, but it was great. I kind of wish I held some of those stocks I bought way back then, but as one does, you trade in and out of things over the years.