French Hidden Champions : lessons and thoughts after one year of going paid

Upwards and onwards!

It has been already one year that I have launched the paid substack! 

Here are the lessons I learned:

• Resilience is key.

• I need to write more.

• After the initial analysis, following the company gets easy and after a couple of calls, quarters, shareholder meetings, you get to know the company fairly well and you know the key drivers

• You get to know your clients really well and exchanges are mutually enriching

• Being an activist takes time. One can’t go activist on each file but when you go into activist mode it is all in. It helps that it represents a big weight in a portfolio.

• Only by buying some shares of the company can you force yourself to do the work. Whatever the amount at play you are incentivized to dig deep.

• Defense first (solid balance sheet, good management, good capital allocation skills, respect of minority shareholders) then offense.

• Investing is a passion so reading a lot is not the issue. The issue is more about focusing on one company at a time. Once I have decided to do a write up on a company I stop looking at new companies.

• It helps that you like the business of a company. Some business are just too complex to me or simply do not appeal to me

• Don’t compare yourself to somebody else. Write at your rhythm and have your own style.

• Be blunt

• Don’t take it personnaly if a client unsubscribes. It is part of life. The only question is am I improving as a business analyst and as an investor. Most importantly am I sleeping well and do I feel confident that I have the right portfolio of companies. 

• Seizing of an investment is not easy but when you know a company inside out and that the downside is protected and that all the right moves are being done by management well a big weight sounds appropriate for me.

• I don’t like to have companies which weight less than 2%. If I can’t push the seizing of a holding to 2% then I lack conviction.

• Monthly subscription offering doesn’t work for me. It brings in too many administrative hassle.

• I like to print my annual reports and other documents. I like to take notes directly on the annual reports.

• I need to write more posts for the free subscribers but it isn’t easy as I owe it to my paid clients to give them my priority. I have to think on what I can write about (French market specificities, accounting tricks, weird things going on in a company enabling people to avoid the really bad companies (of course I won’t say the name of the company as I don’t want any backlash but I am sure that you will found out about which company I was speaking about, writing about some insider moves in some companies where I am not a shareholder (in any case I always disclose if I am a shareholder and remember I never short a company).

• The biggest expense for my company (in France) is the accountant and the bank fees. It is fun to be able to control your costs to the maximum. It is what I can control!

Moving forward I will be doing the following things for the paid substack:

• Only annual subscription

• Not changing my pricing.

• 90% of my posts will be on French companies but sometimes an international name can come up as they are some very interesting companies out there.

• More written Q&A sessions with my clients. Writing forces me to write down and argument more thoroughly my thoughts

• We never know where my substack will lead me too! Life is full of surprises!

Don’t hesitate to spread the word!

Cheers!

Jeremy