Most Read Interviews in 2021

These are the Top 10 most read In Practise interviews over the last 12 months:

1. Naked Wines: Business Model Economics

2. The Danaher Business System Mindset

3. Evolution Gaming & Unregulated Asian Gaming Markets

4. Topicus, PharmaPartners, & VMS Value-Based Pricing

5. Amazon European Logistics Buildout

6. Uber Eats, SkipTheDishes & Food Delivery Business Models

7. Burford Capital: Pioneering Litigation Finance

8. Carvana, KAR Auction, & The Used Car Ecosystem

9. Universal Music, Spotify, & The Music Industry

10. Costco Buying Strategies & Supplier Relationships

The fact the Danaher interview ranked so high was quite surprising to us because it was one we were fairly hesitant to conduct. Danaher is a well-known ‘serial acquirer’ with decades of outperformance. It is difficult to add incremental insight to serial acquirers like Danaher relative to other businesses because the intrinsic value stems from a culture of consistent, accretive M&A rather than the performance of any one operating company or end market at a given point in time.

Also, the executive we interviewed was also a mid-level Supply Chain and Logistics Director at Leica Biosystems, a Danaher operating company. We chose this executive because he was well versed in the Danaher Business System, the operational mindset that has largely driven the success of Danaher. The popularity of the interview is a reminder that going beyond the pool of former C-Suite executives of a business can be fruitful. In fact, with the right topic and the right executive, conversations with the second or even third level of management can often uncover more differentiated insight than a conversation with a much more polished C-suite executive.

The feedback from the Danaher interview also highlights a home truth: in the long run, company culture is what really matters. And a company's culture is very hard to understand and price.

A lot of our work at In Practise focuses on understanding how humans behave within a given system. How a company behaves is ultimately the company's culture. We believe understanding the set of values that drives management’s behavior is crucial to building investment conviction.

For example, not only does Constellation Software rarely see significant drawdowns because the FCF is durable, but the distribution of management's future behaviour is relatively narrow. Investors sleep well knowing it’s unlikely Leonard will do something crazy; CSU will just continue acquiring more, maybe larger VMS businesses year after year. Understanding management behaviour is especially important for serial acquirers where capital allocation is paramount. Leonard’s communication and prior performance is best-in-class in this case.

In the Danaher interview we set out to understand what really defines the way the company behaves by focusing entirely on the Danaher Business System. This is the first in many interviews we have planned to understand how businesses like Danaher or Halma can acquire and integrate companies in a platform-type strategy rather than a more decentralised model like CSU.

Although most serial acquirers have rerated in recent years, we believe it’s easy to underestimate the durability of companies that can consistently grow double-digits with ~50% of the growth from steady, value-accretive M&A. We feel like there is value to add by conducting primary research covering serial acquirers specifically focusing on the values that drive capital allocation and the potential limitations to scale M&A beyond 5-10 acquisitions per year that most acquirers achieve. M&A scalability and management's ability to add new platforms is one of the most important questions for acquirers like Halma, especially when paying today's full multiple.

Watch out for more coverage of serial acquirers next year and please reach out if you have any specific companies you’d like to see us cover.

In Practise: 2021 Review and 2022 Strategy

During 2021, our audience grew over 100% per year and we’ve built a foundation of experienced Premium partners with whom we will be working more closely with to produce high-quality primary research. We’ve also recruited a small team to help us build In Practise into a platform where the best investors come to learn about quality companies.

Our mission is to seek the truth of how the best businesses globally operate.

We care about conducting high quality primary research and work with experienced investors to understand how quality companies work. Content published at today consists mainly of executive interviews, but will grow to include formats like investor dialogues and other ways to learn.

Our 2022 strategy is built on three pillars:

1. High Quality In Practise-Hosted Content (interviews and analysis produced by In Practise)

2. High Quality Investor-Led Interviews (executive interviews hosted by In Practise Premium Partners)

3. Experimenting with new features

In-Practise Hosted Content

We operate in a very competitive industry with companies like our former employer Third Bridge, Tegus, and Mosaic Stream all producing content at scale.

At In Practise, we're most interested in distilling the signal from noise. We are focused on producing differentiated content that helps you truly understand quality companies rather than competing on the basis of scale in our library. We aim to help you build conviction and save you time all at a reasonable cost.

In 2022, we plan to produce more and better executive interviews and more regular Investor Dialogues. We will also spend more time writing digestible analysis each week to draw attention to the most valuable insights uncovered through our work.

Investor-Led Content

In 2022, we will be rolling out more value-added services for our Premium Subscribers including primary research workshops and interview review sessions.

By working with experienced investors operating according to the highest standards in primary research, the entire In Practise subscriber base benefits.

Because of the higher touch model, we will be further limiting access to the Premium subscription.

New Features

In H1, we will be experimenting with new ways for investors to connect, discuss, and learn about companies. If there are any features you would like to see on In Practise then please do reach out.

Thank You

As we close our first full calendar year, we thank you all for the support. We are deeply grateful for the chance to build a business doing the work we love each day. Just like many of our subscribers, we are investors ourselves and are committed to building a learning community to study the best companies in the world. We are here to play this game for a lifetime and are on a mission to understand great companies and allocate capital to the best management teams for the long run.

We hope you enjoy the holidays and look forward to the next phase of In Practise in 2022 and beyond.