Durability: moats, LP trust, and competitive encroachment

I have a special request this week: share this episode with every curious person in your life. 

The conversation, with a 26-year old investor named Ali Hamed, serves as an example of what’s possible when you think creatively. 

Ali views the world with a fresh set of eyes, and has already become an expert at identifying new investment opportunities where others have not. As the second prodigy 26 year old in as many weeks on the podcast, these young guns are making me feel like an ancient 32 year old. 

We talk a lot about “alpha” in our world, earning returns better than the market. But the key word in that last sentence isn’t alpha, it’s earning. Hopefully you, like me, will use this conversation as a reminder of what it takes to earn differentiated returns. It’s not just the hard work, but also the mindset. We explore many examples of how to create new investment opportunities, from rolling up Instagram accounts, to financing perishable fruit like watermelons, to heavy machinery software. 

Please enjoy this special conversation with Ali Hamed. Follow him and his partners. And then go figure out how to earn success yourself in whatever it is you do by helping other people solve problems with empathy. 

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.

Follow Patrick on Twitter at @patrick_oshag

Books Referenced

The Big Short: Inside the Doomsday Machine

Links Referenced

Sheel Tyle Podcast

Seed Investing is a B2C Business, While Growth Stage investing is a B2B Business

Ira Judelson podcast

Free Content and Digital Media Are Increasing Socio-Economic Disparity 

Show Notes

2:24 - (First Question) Ali’s investment philosophy 

3:33 – History of Coventure and its unique structure 

6:30 – The story of how Coventure was seeded 

12:29 – What makes cost of capital such an interesting topic for Ali 

14:13 – Exploring fee structures and the expectations for return in the current environment 

17:02 – The current state of the VC world 

21:42 – Ali’s investment process on the VC side 

25:32 – What other requirements are there for Ali to make a VC investment 

28:00 – Understanding the difference between judgement and empathy in founders

            28:20 – The Big Short: Inside the Doomsday Machine

29:47 – Dealing with LP’s

            32:47 – Sheel Tyle Podcast

33:39 – At one point did Ali feel the most personally at risk in his career

37:55 – Why did they get involved in cryptocurrency 

43:30 – What excites Ali most about crypto

46:09 – Lending as an alternative way to invest in businesses

48:09 – An overview of their lending business

50:21 – How does deal flow and sourcing work in these arrangements

52:54 – How much encroachment will Ali face from competitors

54:28 – Exploring the idea of valuing and buying digital accounts

59:36 – How Ali thinks about marketing for his own firm and the ones he invests in

1:00:06 – Seed Investing is a B2C Business, While Growth Stage investing is a B2B Business

1:03:59 – Longer term aspirations for Ali and industries that he would avoid

            1:04:25 – Ira Judelson podcast

1:08:05 – Ali’s view on the potential negative impact of free content

            1:08:19 - Free Content and Digital Media Are Increasing Socio-Economic Disparity

1:12:48 – Kindest thing anyone has done for Ali

Learn More

For more episodes go to InvestorFieldGuide.com/podcast. 

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag