Archive for the 'Companies' Category

Join Eric Schleien in this Q&A format as he answers questions on short positions, investment strategies, destroying your own conclusions on business and investments, and so much more. When asked about the mistakes he's made with investments and what can be learned from them, Eric expounds on what he thinks is a rear-view mirror thinking and on how he managed to lose more money to areas of omission than commission. 

Summary

While it's common for others to work on becoming large firms, Eric's unique gameplay is to stay boutique and manageable. For Eric, it's not necessarily rejecting growth. Instead, it's more about being able to hold control and balance on different elements. When you're running multiple large funds, it will reach a point where you start losing the competitive advantage by becoming too large, he explains.

In this episode, the group also brings up the relevance of Environmental and Social Trends in determining the long-term value of companies. Quoting from Brookfield Asset Management CEO Bruce Flatt, "It's not a good business to not be a good steward of the environment.", for Eric, if a business is taking steps to have an adaptable and inclusive culture – value is quickly elevated. Even though it's not the end-all-be-all, for Eric, when a business does good in proving its CSR, it helps contribute to building a competitive advantage and value in the long run.

Show Notes

  • [01:20] Podcasting is going to be bigger than radio; On Liberated Syndication/Libsyn (LSYN).
  • [06:26] How do you size your investments and know what to trim?
  • [10:38] The art form to portfolio management.
  • [14:00] On the threat inflation poses.
  • [19:50] The advantages of being a boutique firm.
  • [21:53] On not taking short positions.
  • [26:26] Has the pandemic changed investment strategies?
  • [28:22] Rear-view mirror thinking.
  • [34:05] How do you factor in ESTs on a business's long-term value?
  • [36:39] There's only so much you can control when you run large funds.
  • [42:06] When an investor insists on dividends…

Resources

Principles of Power - The Art & Wisdom of Badassery Book by Eric Schleien

About Eric Schleien

Over the past decade, Eric has trained thousands of individuals, including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

Help Out The Podcast

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

CONTACT ERIC SCHLEIEN

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: intelligentInvesting@gmail.com

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Join Eric Schleien with today's interview guest, Julian Lin, as they discuss the different names in the country's cannabis industry and the stocks he entered and exited in light of the pandemic. For some of these companies, leaving the pandemic with so much debt and having to spend so much for redevelopment isn't going to be an excellent spot to have.

Summary

In this episode, Julian also talks about the presence of Canadian cannabis brands in American markets. Despite them being 'okay,' because they're the only names people can invest in when in America, the evaluations of these brands coming from across the border remain to sore insanely. Nonetheless, cannabis brands have challenges unique to them in general.

Julian acknowledges that when you look at these companies, they scream expensive. In reality, if cannabis is decriminalized and is not to pay a particular type of tax in the future anymore, their shares will trade at multiple folds in earnings. For Julian, the macro picture for cannabis is all promising in the next 2-4 years.

 

About Julian Lin

Julian Lin runs Best Of Breed, a research service uncovering high conviction ideas in the winners of tomorrow. He is ranked in the top 1% of all bloggers on Tipranks.

Show Notes

  • [01:04] "A terrible time to own those stocks."
  • [02:52] How did Simon Property Group enter the pandemic?
  • [04:14] It's a problem with the cost of capital.
  • [07:27] The cannabis industry in the Biden administration.
  • [09:07] Cannabis in Canada.
  • [11:30] The business models of different cannabis brands.
  • [13:03] What cannabis companies are not allowed to do.
  • [15:54] GTI is a multi-state presence.
  • [17:11] The future for Cannabis.
  • [17:48] The primary catalyst for American cannabis stocks.

 

About Eric Schleien

Over the past decade, Eric has trained thousands of individuals, including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

 

Help Out The Podcast

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

CONTACT ERIC SCHLEIEN

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: intelligentInvesting@gmail.com

 

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Join Eric Schleien with his guest Andrew Sather as they talk about Warren Buffett's Cash Cows, Hedging the US Dollar, Residential Real Estate, Griffon, and Electronic Arts.

In this episode, Andrew also sheds light on stock buybacks and turning over rocks in order to unearth value even from beat-up ventures and potential investments. He emphasizes the strategy of having enough key players in a business or investment that's enough to stabilize everything.

Stay tuned to this discussion and find out what else Andrew has to say about the current financial industry.

 

About Andrew Sather

Andrew is a self-taught investor since 2012. He specializes in identifying value traps and avoiding stock market bankruptcies.

"I didn't see a resource to walk beginners through investing, step by step. So I went out and made it.", Andrew said.

 

Show Notes

  • [03:31] Warren Buffett's Cash Cows
  • [04:55] Companies need to do it smartly with Buybacks.
  • [06:45] The parallels of EA Games and DairyQueen.
  • [09:10] What makes EA Games a Cash Cow?
  • [12:10] On turning over rocks; books by Peter Lynch.
  • [13:13] An observation I disagree with…
  • [14:34] What needs to be understood in flipping rocks in beat-up industries.
  • [18:23] Having a hedge for the US dollar.
  • [19:00] What I found out about the Top Companies in the S&P 500?
  • [19:58] Companies whose revenue did well even if the US dollar didn't.
  • [26:35] The likes of Paypal; the likes of Mastercard.

 

Resources

 

 

About Eric Schleien

Over the past decade, Eric has trained thousands of individuals, including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

 

Help Out The Podcast

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

CONTACT ERIC SCHLEIEN

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: IntelligentInvesting@gmail.com

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Join Eric Schleien with today's interview guest, Trey Henninger, as they talk about Entercom, Northfield Precision, and the new SEC rule that impacts dark companies and small businesses. By taking a close look at the outcomes and probabilities close to ETC and the merger made with CBS Radio, he explains what Entercom holds for the next 12-18 months and tells us the technicalities on why he thinks owning shares from the company can still end up positively.

Summary

In this episode, Trey will also be getting into all the old news, the expected, and the good with Northfield Precision Instrument Corp. Listen as he discusses the company's performance during the pandemic, their ROI report, and how NFPC will seemingly be affected by the new SEC rule that targets dark companies. For Trey, once the new regulation comes into effect in the following months or years, going expert or grey may become an option to be considered for Northfield.

Going in further on the upcoming SEC rule, tune in as Trey explains what the regulation aims to do, what it requires from business entities, how it can backfire, and what it means to trade without a quoted price –a scenario that may just mean good deals for experts. For him, there are always as many opportunities in matters like these as there are risks in every leverage.

 

About Trey Henninger:

Trey Henninger runs the blog and podcast DIY Investing. Trey is a private value investor focused on microcap and dark stocks in the United States. His focus is on high-quality companies with predictable, durable earnings where management has skin-in-the-game.

Trey runs a concentrated portfolio of 5 stocks with a 20% weighting each. By focusing on small companies, Trey hopes to find overlooked compounders at value prices. His favorite opportunities have a market cap below $50 million.

 

Outline of the episode:

  • [00:42] Entercom Communications – America's #2 Radio Broadcasting Company.
  • [02:18] ETC as a radio company and as a growing digital audio presence.
  • [02:49] The crashing merger of ETC and CBS Radio.
  • [03:46] Binary outcomes and the probabilities for the company now.
  • [06:55] What the debt market is telling about it.
  • [08:03] Covid as an excuse...; The company's ownership.
  • [09:49] A business with no assets, basically.
  • [13:09] Bad as expected – Northfield Precision
  • [15:54] What SEC Rule is, not retail investor-friendly.
  • [16:40] How the new regulation can backfire – a theory!
  • [18:25] What it means to not get quoted a price…
  • [19:45] Anytime you have leverage, there's risk and also lots of opportunities.

 

Resources:

CBS Radio and Entercom merger

Follow and subscribe to the new, The Eric Schleien Podcast:

 

About Eric Schleien:

Over the past decade, Eric has trained thousands of individuals, including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

 

Help Out The Podcast:

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

 

CONTACT ERIC SCHLEIEN:

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: intelligentInvesting@gmail.com

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Join Eric Schleien with his guest Peter McCormack as they talk about podcasting, the unique characteristics of Bitcoin, and what the future holds for it. Because of the oppositions and baseless accusations against it, for Peter, Bitcoin should've already failed. Today, it is still operating and growing even higher.

 

In this episode, Peter gets into discussing decentralization, Bitcoin mining, his piece of advice to anyone looking into investing in Bitcoin, and so much more. To interested investors, Peter believes there should be a profound investment strategy before throwing money onto Bitcoins. He believes cryptocurrency can be a very punishing investment if done wrong.

 

Stay tuned to this casual exchange and find out more of what Peter has to say about Bitcoins and investments.

 

About Peter McCormack:

 

Peter McCormack is a full-time journalist/podcaster covering topics such as Freedom, Human Rights, Censorship, and Bitcoin. He is the host of the What Bitcoin Did Podcast.

 

The What Bitcoin Did Podcast, is a twice-weekly Bitcoin podcast where host Peter McCormack interviews experts in the world of Bitcoin development, privacy, investment, and adoption. Launched in November of 2017, the podcast has grown to nearly 200 episodes with a guest list that is a testament to the diversity of knowledge and opinions that represent the broader Bitcoin community.

 

Individual podcast episodes have focused on engaging and accessible conversations with some of the industry's most influential minds. Established veterans such as Adam Back, Charlie Shrem, and Andreas M. Antonopoulos have shared the WBD mic along with rising stars. No areas of discussion are off-limits, and differences of opinion are encouraged. Past topics have ranged from Cannabis to Censorship, Libertarianism to the Lightning Network, and Sex Workers to Segwit2x.

 

You can find Peter McCormack on:

 

Outline of the episode:

 

  • [01:59] Stumbling upon Podcasts in a vegan retreat in Italy…
  • [03:29] Podcasters – just get out and do it!
  • [04:50] Are cryptocurrencies worth investing in?
  • [06:20] What is decentralization?
  • [08:04] The resistance of Bitcoin.
  • [11:24] On Bitcoin's stability.
  • [13:40] What does Blockchain do?
  • [17:15] Bitcoin Mining.
  • [20:00] A bit of advice to anyone wanting to invest their money in Bitcoins.
  • [21:51] Is Satoshi Nakamoto fame-driven, rich, alive?
  • [24:39] What could break Bitcoin?
  • [27:53] Privacy in Bitcoin.
  • [30:30] The first thing to do when getting into Bitcoins.

 

Resources:

How to Start a Podcast in 2020 Pat Flynn

 

Understanding DigiCash

 

How to Download Kraken Pro: Advanced Bitcoin & Crypto Trading on PC:

 

Kraken's Official Mobile Apps

 

About Eric Schleien: 

 

Over the past decade, Eric has trained thousands of individuals, including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

 

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

 

Eric currently resides in Philadelphia, PA.

 

Help Out The Podcast:

 

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

 

You can subscribe to the podcast on the following platforms:

 

 

 

CONTACT ERIC SCHLEIEN:

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: IntelligentInvesting@gmail.com

 

 

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Join Eric Schleien with his guest Norma Belenky, the Head of Events of Podbean, as they talk about the evolution of media, Podbean’s exciting podcast features, and most especially the upcoming Finance Podcast Week.

 

In this episode, Norma shares her story on getting into podcasting and the facet that sets apart a podcast. She also gives us a brief of the stimulating discussions, guests, and perks we can expect from Podbean’s event that every entrepreneur, investor, and alike will gain from.

 

Stay tuned to their talk to catch a glimpse of Finance Podcast Week’s exciting lineup for everyone.

 

About Podbean: 

Podbean is a podcast publishing and monetization service, providing free and premium hosting packages for individuals and businesses. Podbean offers a user-friendly interface that integrates publishing, management, syndication, and analysis tools into an easy-to-use podcasting package.

 

Facebook:       https://www.facebook.com/NormaJeanBali/

Instagram:       https://www.instagram.com/normajeanlovesdoodles/

 

Outline of the episode:

 

  • [01:12] What is Podbean, and what does it bring?
  • [02:32] The upcoming Finance Podcast Week: Guests, Topics, and Program.
  • [05:26] Elements of media changed by today’s podcasts.
  • [08:54] The freedom in Podcasts.
  • [09:41] Live features on Podbean’s Finance Podcast Week and what to expect.
  • [13:08] The technology, integrations, platforms, and accessibility of today.
  • [15:39] Ask the hosts, join in the conversation – Podbean Finance Week.
  • [18:23] Live podcasts + Pre-released episodes of participating podcasters.
  • [19:23] The dates to save…
  • [22:03] On getting into podcasts and becoming a part of Podbean.
  • [25:20] The community, collaborativeness, and openness that is in podcasting.
  • [26:37] What needs to be a part of podcasting?
  • [27:32] In the age of information overload, to stand out, you need to have…

 

Resources:

 

About Eric Schleien:

 

Over the past decade, Eric has trained thousands of individuals, including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

 

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

 

Help Out The Podcast

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

 

CONTACT ERIC SCHLEIEN

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: IntelligentInvesting@gmail.com

 

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Join Eric Schleien with his guests, Chelsea Dietsch and Tara Songster of Alluring Oddities, as they share stories about their income-generating passion for thrift shopping and what it took to make this side-project grow and continue growing.

More than just a business, Chelsea and Tara treat their passion as a venture wherein they can cultivate experiences for their friends, loved ones, and Buffalo's whole community. Community over competition is a general outlook that they endorse.

Learn more from their experiences as you tune in further to what Chelsea and Tara have to share.

 

About Alluring Oddities:

Alluring Oddities is a curated and cultivated gallery of mostly 60s or 70s offbeat thrifted treasures in Buffalo, NY. The brand is owned by Chelsea Dietsch and Tara Songster.

 

Outline of the episode:

  • [07:45] The fascination towards everything timeless in condition.
  • [09:53] Make money out of it, not: get rid of it.
  • [11:03] More than just a business, it's a lifestyle.
  • [13:22] Alluring Oddities: a thrift store's gross margin.
  • [14:37] Set your brand different from others.
  • [15:30] The resurgence in Buffalo's market.
  • [17:03] Why interact with your audience? Why research? Why benchmark?
  • [19:44] Connecting to peoples' stories through their belongings.
  • [25:43] On price tagging.
  • [26:34] "Community over competition."
  • [29:22] What your venture will mostly need from you.
  • [30:06] Putting everyone's strengths at work.

 

Resources:

 

Bounty Hunter TK4 Tracker IV Metal Detector

Value Investing 2nd Edition

Principles Of Power

 

Thrift at or Donate to Goodwill

 

Thrift at or Donate to Salvation Army

 

 

About Eric Schleien

Over the past decade, Eric has trained thousands of individuals including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

Help Out The Podcast

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

 

CONTACT ERIC SCHLEIEN

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: IntelligentInvesting@gmail.com

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Join Eric Schleien & Rafael Resendes discuss how to value and measure the intrinsic value of Tesla (TSLA) and GameStop (GME).
 
Rafael Resendes is the portfolio manager & co-founder of Applied Finance Capital Management.
 
To watch this on YouTube (which for this one, I would recommend) - you can click, here.
 

Resources

  • For listeners interested in some of the research presented on the show today, you can sign up for the monthly newsletter, The Valuation Edge.
  • For listeners interested in actually modeling companies they can join the waiting list for the Intrinsic Value Tool.
  • Value Investing 2nd Edition, on Amazon.

  • Eric Schleien's Book: Principles Of Power: The Art & Wisdom of Badassery, on Amazon

 

About Eric Schleien

Over the past decade, Eric has trained thousands of individuals including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

 

Help Out The Podcast

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

 

CONTACT ERIC SCHLEIEN

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: IntelligentInvesting@gmail.com

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Summary

In this episode of the Intelligent Investing Podcast, I sit down with the Founder & CEO of Shift (SFT) which went public recently via a SPAC.

 

Show Notes

1:29: Background On George Arison
3:50: Getting into the automotive space
4:39: The Auto Financing Market
10:16: Starting Shift
13:49: Company Growth
15:16: Disruption in Cars
16:20: The Traditional Dealer
16:26: Carvana vs Shift
18:49: Older cars are a huge part of the used car market
19:10: "How do you look at internal rate of returns?"
19:26: "it's a kind of a land grab situation"
20:31: "what the business looks like at scale"
27:02: "select dealers that we want to work with that have really high-quality inventory, high-quality service."
27:15: "a win for the dealership."
30:21: "how do you fund the growth right now?"
31:44: SPAC investing
33:16: "SPAC investors might actually get really burned if they're just buying a bunch of things that seem very sexy."
33:51: "There's been many, many, like over a hundred SPACs. I don't know how they're going to find deals."
34:53: "what investors should be looking for when they look at SPACs"

 

About Eric Schleien

Over the past decade, Eric has trained thousands of individuals including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

Help Out The Podcast

If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

You can subscribe to the podcast on the following platforms:

 

CONTACT ERIC SCHLEIEN

Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

Email: IntelligentInvesting@gmail.com

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Had the pleasure of bringing back on Don Chambers who is currently involved in an activist campaign against SVVC. To see the first episode where he discusses his ongoing battle with SVVC, you can click here.
 
You watch this as a video on YouTube, click here.
 

Show Links

 
 

Don's Proposal

 

PROPOSAL THREE
(Non-Binding Stockholder Proposal)
THAT THE BOARD SEEK AND PURSUE ANY AND ALL MEASURES TO ENHANCE SHAREHOLDER VALUE

 

A stockholder, Donald Chambers, submitted the following proposal for inclusion in the Company’s proxy materials. If the stockholder, or a representative of the stockholder who is qualified under state law, is present and properly submits the proposal for a vote, then the proposal will be voted on at the Annual Meeting. The Board of Directors unanimously recommends that you vote AGAINST the proposal. The proposal and the stockholder’s supporting statement, exactly as received from the stockholder, are set forth below and are followed by the Board’s explanation of its reasons for opposing the proposal. As an advisory vote, if approved, the stockholder’s proposal would be a non-binding recommendation to the Board of Directors. The Company will provide Mr. Chambers’s address and number of shares held promptly upon oral or written request.

 

STOCKHOLDER PROPOSAL

 

RESOLVED: That the shareholders of SVVC assembled at the 2020 annual meeting in person and by proxy, hereby request that the Board of Directors of SVVC seek and pursue any and all measures to enhance shareholder value including: (1) orderly termination of the fund, (2) orderly liquidation of SVVC assets with distribution of available cash to shareholders, (3) tender offers for SVVC shares using available cash from any and all investment exits, (4) merger of the fund into an entity offering shareholder exits near NAV (net asset value), or (5) other measures likely to allow shareholders to exit SVVC near its NAV.

 

REPRINTED SUPPORTING STATEMENT FROM STOCKHOLDER

 

I urge shareholders to vote “Yes” to this proposal for the following reasons (based on information, belief and personal computations):

The performance of SVVC’s stock has been catastrophic relative to relevant benchmarks. The total annualized compounded market returns of SVVC and three relevant benchmarks over the life of SVVC are:

 

Ticker

Description

Annual Return
4/28/2001
-10/24/2019

VT1

Total stock market ETF

9.5%

VB

Small stocks ETF

8.0%

SPBDCUP

S&P BDC Index

6.3%

SVVC

 

-8.9%

 

Basing SVVC’s return on its recent NAV generates a positive return (4.8%). But that highlights the crux of the problem: SVVC’s NAV overstates its value under current management because it does not fully account for prospective fees and expenses. SVVC’s market price does reflect the massive fees and indicates a loss of -8.8% per year. SVVC’s 2% annual management fee (on gross assets) is roughly a 7% annual fee based on the market value of the equity. SVVC’s most recent statement reports $908,003 as the quarterly management fee (which is over 50 cents per share annualized). There are additional expenses and a 20% incentive fee on realized net profits. Accordingly, the discount of SVVC’s market price to its NAV has been very large - recently well over 50%.

 

The annual rate of compensation to each of the four independent directors of SVVC is $50,000 per year yet, reportedly, only one director held SVVC stock and that director held only 700 shares (see SVVC Proxy Statement 5/30/19).

Assuming that SVVC’s valuations of its private investments are reasonable, the Directors should be able to locate private equity investors enabling SVVC to be liquidated at a value near to its NAV.

 

Disclosure:

Mr. Chambers is a part-time employee (CIO-Model Portfolios) of Biltmore Capital Advisors (BCA) which manages approximately 292,254 shares of SVVC on behalf of its clients. Mr. Chambers has recused himself from all decisions at BCA regarding SVVC transactions or voting while this proposal is under consideration. SVVC is a restricted security for BCA employees so Mr. Chambers is restricted from transacting in SVVC while this proposal is under consideration. 

 

About Don Chambers

Donald R Chambers currently runs the website, SaveFirstHandTechnology. He is also a recently-retired (June 2017) professor of finance with 36 years of teaching experience. Dr. Chambers has written several books regarding investments and personal finance that are distinguished by their clear writing and ability to make difficult concepts accessible to his audience. He is the lead author of the 600+ page Modern Corporate Finance: Theory and Practice which is in its eighth edition (forthcoming with FlatWorld), the 1,000-page Alternative Investments which is in its third edition with Wiley, and several other books on finance. Dr. Chambers has published over 50 scholarly articles.

Dr. Chambers has had numerous appearances in media including national television, national public radio, regional television, and regional radio. Dr. Chambers co-starred in a nationally-televised cable television series regarding finance in 1988 (45 Fortune) and frequently serves as a public speaker.

In more recent years, he has written numerous blogs and spoken frequently regarding investments in his role as Chief Investment Officer of Biltmore Capital Advisors.

 

About Eric Schleien

Over the past decade, Eric has trained thousands of individuals including board members of public companies as well as several Fortune 500 CEOs. Eric specializes in organizational culture and has become a leading authority on organizational culture in the investment industry.

Eric has been investing for 15 years and has been using breakthrough coaching methodologies for over a decade. Eric had the insight to combine proven coaching methodologies with shareholder activism techniques to create an entirely new model for shareholder activism that was more reliable and created greater sustainable results in a rapid period of time. On average, Tribal Leadership produces a 3-5x increase in profits of culturally troubled companies within an average of 24 months or less.

Eric currently resides in Philadelphia, PA.

 

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