Friday Wrap-Up: Lessons from a Former Boss and the Decline of Shareholder Rights

Marthe Skaar (0:00)

Hi, everyone, and welcome back to our Friday wrap up. I'm still Marthe Skaar.

Nicolai Tangen (0:04)

I'm Nicolai Tangen.

Marthe Skaar (0:06)

And today, we're going to talk about a very special episode. We're also going to talk about shareholder rights. And we're going to talk about gratitude.

This week's episode is trending.

Nicolai Tangen (0:29)

It's doing very strongly. What we do find is that some of these investment episodes are very strong. I'm not sure that there are so many great investment episodes out there. And then this person in particular, John Armitage, is extremely well known in the investment world, but not so famous outside the investment world. But it's really, really worth looking at. So please tune in to the whole episode as well.

Marthe Skaar (0:53)

And he's very special to you, of course, because he's your former boss.

Nicolai Tangen (0:57)

He is one of the most important people in my life. I would say next to my wife.

He was my boss for five years. But before then even, he was important because when I was on the sales side, I worked as an analyst. He was my largest client. And so I traveled a lot with him across Scandinavia. I sat in on company meetings. So he was totally formative for me as an investor and me as an analyst, and really taught me how to look at companies and how to analyze companies.

Marthe Skaar (1:26)

Yeah, so give us a bit more details on that. What did he teach you?

Nicolai Tangen (1:31)

Well, first of all, he is very thorough. He is very good at asking questions. He is very curious. And I thought he was particularly good at looking at why companies are successful, going through the profit and loss account in great detail. Where is the growth coming from? How resilient is it? What are the drivers? And so he distilled the drivers of companies' profit and loss into its various components. And then he was very focused on what we call operation leverage. And that means how much of the incremental sales does a company actually capture in profits? And so that was kind of one of his key, key things to look at. And very, very important. Very few people know how to analyze it. Very few people understand just how important it is.

So that was important. And then, of course, portfolio management, how you put together a portfolio of companies which all have different drivers, right? So that if something happens in the world, your whole portfolio doesn't go down in flames. And so he's been super important. Now, that was important as a trainer. But then as a person, when I set up AKO, I couldn't have done it without him because you need a reference. You need somebody who is really voicing for you, who is telling everybody else that I think this is going to be a success. You should back this guy with money.

Without him and his colleague, he was called Bill Bollinger, there would have been no AKO Capital, there would have been no me, there would have been for sure, I would not have had this job.

Marthe Skaar (3:02)

Why was he willing to do that for you?

Nicolai Tangen (3:04)

Because he's just a great guy. I mean, he's just like a total triple A guy. There are very few people like him, very few people with that honor code. I think you find them in England more than other places, but he for sure is one of a kind.

Marthe Skaar (3:15)

Nicolai believed in you.

Nicolai Tangen (3:16)

Well, that's at least what he said.

Marthe Skaar (3:18)

He also reflects on that. He looks for management that admits their mistake. How do you spot that in a meeting?

Nicolai Tangen (3:26)

I think you do really look for that kind of humbleness, because if you don't spot mistakes, if you don't look for mistakes, you are never going to improve. It's very, very important. When I interview graduates and other people, it's one of my most important questions. What part of yourself are you trying to improve? If people are not trying to improve anything, they are just no good.

What are you trying to improve?

Marthe Skaar (3:48)

Well, I'm constantly trying to improve, both as a manager and a human being, I think.

Nicolai Tangen (3:53)

That's good.

Marthe Skaar (3:54)

And then talking about that, because he also says that he wakes up every morning, and then he wonders, will I ever be successful again?

Nicolai Tangen (4:03)

Yeah. He has a huge self-doubt. Now, I think you can be good without doubting, you know, the fundamental basis of your life and your profession, you know. So, I have to say, I don't wake up every morning and think I'm a total disaster, and that I'm wondering whether I'm going to fail. I do think that hopefully things will be okay. No, he has got a huge self-doubt.