The Long View Pat Dorsey: Economic Moats and More
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Mar 31, 2026 Pat Dorsey, founder of Dorsey Asset Management and former Morningstar equity research director, built the firm’s economic moat framework. He breaks down moat types like brands, network effects, and pricing discipline. He discusses common mistakes in identifying moats, evaluating management and founders, when to avoid “too hard” areas like frontier AI, and using premortems to spot risks.
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Network Effects Aren't Automatically Durable
- Network effects can be overstated; type of network and value delivered per user determine durability.
- Pat highlights PayPal's obfuscated transactions metric masked declining branded-button utility despite large user counts.
Prioritize Humble Managers Who Listen
- Look for humility and willingness to listen when evaluating management quality.
- Ask whether leaders credit their teams, admit mistakes, and respond thoughtfully to critical questions in interviews and conferences.
Use Public Talks To Judge Management Candor
- Use public interviews and conference transcripts to assess management candidness and culture.
- Pat recommends YouTube interviews and sell-side conference talks to see how management frames successes and answers tough questions.
