Simoleon Sense Interviews Greenbackd
Miguel Barbosa of Simoleon Sense has posted an interview with Greenbackd, one of our favorite blogs for value-oriented investors. Excerpt:
Q: How did your (academic) background prepare you to invest in activist and liquidation oriented investments?
A: I’m an ex lawyer, so I read filings like a lawyer, which means I’m always trying to find the seemingly innocuous note that reverses the headline position. I also think of the company as a creature separate from its business. Buffett-style investors desire a “wonderful business at a fair price.” To me, that’s only half the story. A company with a broken business model or no business model can be a great investment, for example, if an activist can get on the board or persuade management to take the cash burning business to the woodshed and salvage some of the value on the balance sheet. SOAP and AVGN are good examples of this phenomenon. They were both examples of what I call “activism by defenestration”: management were the ones who threw the business out of a window, but at the pointy end of an activist campaign.