Ram Parameswaran - Internet Scale Businesses

**Patrick O'Shaughnessy** (0:00)
This episode of Invest Like the Best is sponsored by Canalyst. Canalyst is the leading destination for public company data and analysis. I'd heard of Canalyst over the past few years and became more interested after meeting the founder and CEO last year to pick his brain about SaaS businesses. Founded by a former buy-side analyst who encountered friction in sourcing, building and updating models, Canalyst is now used by over 300 institutions, including the largest money managers in North America and by a number of guests on the show. With detailed company-specific models on virtually every investable public equity, Canalyst clients are able to react more quickly. If you've been scrambling to keep up with the deluge of IPOs these days, Canalyst has models on DoorDash, Palantir, Airbnb, and everything in between. Their pre-IPO models are built as soon as the S1 hits and include all segments, KPIs, and non-GAAP figures. If you're a professional equity investor and haven't talked to Canalyst recently, you should give them a shout. Learn more and try Canalyst for yourself at canalist.com forward slash Patrick, that's canalyst.com/patrick.
Stay tuned at the end of the episode where I talk to Canalyst's customer Fenimore Asset Management about how Canalyst helps their firm better find and manage their investments.
Hey everyone, Patrick here to highlight a very unique sponsor. This week's episode is brought to you by the MIT Investment Management Company, also known as Mitimco, the endowment office of MIT. New and small investment funds listen up. Mitimco is looking to find investors starting funds today. Mitimco is partnership driven, long-term focused, and has an extensive history of backing investors early in their careers. These partners are key to delivering the outstanding investment returns required to support MIT's pursuit of world-class education, cutting edge research, and groundbreaking innovation. Mitimco is focused on finding and partnering with the best investors across the globe, no matter the market environment. No firm is too small, too young, or too non-institutional.
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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** (2:39)
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 Oshanose Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (3:05)
My guest today is Ram Parameswaran, founder of Octahedron Capital. Ram started Octahedron this year after more than five years as a partner at Altimeter Capital where he led investments in Square, Bytedance, Pinduoduo and Udaan. In our conversation, we cover the potential for internet scale businesses, explore the common characteristics of these businesses, and then go through a rapid fire round of the most important qualities for eight different business models.
This conversation was a blast of energy and could have gone on for two more hours. I hope to have Ram on again and can't imagine what his conversations are like at the dinner table with his wife and former podcast guest, Anu Hariharan. Please enjoy this awesome conversation with Ram Parameswaran.
So Ram, I think we have to set the stage here with the broadest description of the opportunity that you see in front of us as you can. I'll call this the commercial internet. Maybe you could just describe what that phrase means to you, why you think it represents the size of the opportunity that it does.

**Ram Parameswaran** (4:02)
Thank you for having me on the podcast. So when I think about the internet, I think about what is the sum totality of human knowledge, human creativity, and human capability. It's very difficult to put a number on it, but here are a few attempts at doing it. If you think about the global GDP of 85 trillion plus, I just think there's just so much opportunity still left for the internet penetrating that entire global GDP. So the internet's what, 30 years old? Now it's a utility for all of us, and it took us years to get here.
But after 30 years in 2020, I think we're at the beginning of that escrow. And it's happened now because of a few things that have happened over the last 20 or 30 years. Number one, we have ubiquitous high-speed connectivity on mobile devices and future mobile devices. Now that's been a process that we're kind of as a part of it for years. And now it's real. If we cannot stream a high 4K video on your mobile phone, you're going to be really annoyed right now. But this wasn't the case even 15 years ago. Number one. Number two is you've now got cloud infrastructure and tools that drive cloud infrastructure that allow every single piece of global GDP to become a part of the mobile Internet. That's the second piece. And now with COVID, which is this unfortunate situation we live in right now, COVID basically allowed people and talent to be globally discoverable and globally utilized.