USC Student Investment Fund: Annual Performance

This past week we held the USC Student Investment Fund (SIF) annual meeting.  The annual meeting is an event that draws approximately 60 SIF alumni, during which each of the five student-run mutual funds presents its annual performance to the crowd.  Based on last year’s interrogation of the students by the audience, which featured some tough questions about Netflix (among others), my classmates and I (pictured left) were a bit nervous leading up to the event.  However, we did a great job – we effectively presented our performance, investment rationale and fiduciary duty.

Over the last twelve months I, along with my classmates Kai Wang and Abhinav Anand, managed the California Small Cap Fund (CSF), an approximately $1mm mutual fund which invests primarily in California-based small cap companies.  Kai, Abhinav and I put a lot of work into managing the fund and the SIF coursework; however, it was work that paid off.  We learned (more…)

Remembering to Keep it All in Balance

As school comes to a close and I head off to do ibanking at Credit Suisse, keeping it all in balance seems to be a closing theme.  During my TEC (The Executive Committee) meeting last week, I discussed this issue at length with my mentor, Pete.  He reminded me that it’s great to be successful in business, however, it’s even better to be successful in business and life.  Pete then told me the stories, lives, and careers of people he knows.  Some sounded great, success in business, family and friends.  Others sounded downright miserable, complete with family members suing each other. (more…)

Succinct and Timeless Business Advice

A few weeks ago I got some timeless advice from a guest speaker in my TOC program, an on-campus forum for MBA students to interact with classmates and seasoned executives to better manage one’s business and career.  The guest speaker, who requested no attribution for this post, gave me and my classmates the below advice.  This is one of the best, succinct, lists of management principles I have come across, so I thought it would be nice to share it here for a broader audience.  The italics are my own notes.

Lessons Learned Along the Way

The three critical elements of a company are: Market, Management and Money.  You need all three for a good business.  Never forget, growing companies need money.  Growth is affected by external financing needs, margin, ROE, etc.

The Market

  • Know now your company’s value proposition (i.e. why customers should do business with you). (more…)

A Note on Competition: Avoid the Obvious

“The more challenging and potentially lucrative the waters you fish in, the more likely they are to have attracted skilled fisherman.  Unless your skills render you fully competitive, you’re most likely to be prey than victor.” – Howard Marks

Which is better: Seizing the ripe opportunity in front of you, or hunting down a mediocre one on the fringe? I would argue the latter, which I want to demonstrate with something that has been a big part of my life – surfing. Yes, surfing. I realize this is a stretch for non-surfers, but with this story I think you will see the parallels to opportunities in your life, whether they are business or personal ones. (more…)

Interesting Start-ups: Pinterest, Ness, Everlane, Shaker

A v2.0 of Ma.gnolia and Del.icio.us, Pinterest is an interesting start-up.  And judging from the number of “new follower” e-mails I get daily, it’s interesting to a lot of my friends, too.  But I’m not totally sold on this one.  Do we need another source for content curation in addition to Twitter, Facebook, RSS, LinkedIn, and traditional media websites?  For the sake of the company’s impressive list of investors, I hope I’m wrong, but nevertheless it will be interesting to see the evolution of this site along with the cadre of recently launched competitors: Canv.as, Snip.it, Svpply.com, Nuji.com and Pearltrees.com.  UI and speed to scale are going to be the keys to success in this space – and in this regard Pinterest seems to be doing a great job. (more…)

Quote: Warren Buffett on Ignoring Stock Market Chatter

“We don’t buy and sell stocks based upon what other people think the stock market is going to do, (I never have an opinion) but rather upon what we think the company is going to do.  The course of the stock market will determine to a great degree, when we will be right, but the accuracy of our analysis of the company will largely determine whether we will be right. Who would think of buying or selling a private business because of someone’s guess on the stock market?”  -Warren Buffett

My dad recently sent me this quote.  I like it because it helps keep short-term commentary from affecting long-term analysis and opinion, the true focus of investing (in my opinion).  Through the SIF, I have had the chance to hear similar thoughts on investing from people such as Dave Iben at Tradewinds; he doesn’t want to hear anything unless it will be meaningful in five years.  It’s nice to hear that others try to ignore CNBC and the like, too.

Entrepreneurship: Picking A Co-Founder

I’m sitting in my entrepreneurship class, Cases in New Ventures, taught by Professor Steven Mednick.  The first half of each class is a series of student presentations, which are little boring to be honest, but the second half of class is great.  During the second-half of each class, an entrepreneur speaks to us about their entrepreneurial journey.  Last week we heard from an entrepreneur that had a $160mm deal fall apart during the 2008 financial crisis.  This week, we heard from an entrepreneur whose partner cratered a $100mm deal.  My big takeaway this week was one key item: Pick your co-founder carefully.  Below is the advice that the entrepreneur gave us. (more…)

Update: Stock Pitch Template for the MBA Crowd

Last year while applying to USC’s Student Investment Fund, I put my stock pitch on my site to be used as a template by others.  Admittedly, that model was a bit of a hackjob given my time constraint.  But thankfully it was good enough to help me get into the Student Investment Fund (I now co-manage the California Small Cap Fund).

I recently created an updated stock pitch template for my SIF classmates at the request of Professor Ku based on my valuation background.  Here is the new Excel valuation template.  This model is much simpler, and it does a better job with sensitivity analyses.  If you are going to use this model for a pitch, I would recommend creating a revenue build sheet to build up to forecasted sales.  This will show your interviewer that you know the business’s revenue model. (more…)