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Moritz Drews's avatar

Hi Martin, thanks for your positive feedback!

Regarding quality companies: Great question!

Quality means to me, a company checks most boxes when it comes down to:

- Fundamentals (metrics like growth, profitability, customers etc. moving in the right direction)

- Leadership (Visionary founder-CEO, strong C-Level execs in his back)

- Great culture (employees approve CEO and love working there)

- Moat (to maintain a competitive advantage)

- Business is in an industry with tailwinds and a large runway

etc.

Visa or Apple are high quality businesses as well: Great leadership, moat, profitable, large amount of cash, people like working there. They are just not growing fast enough for my taste, as I am investing in high growth. It is almost impossible for them to grow as fast as Snowflake due to their size. This doesn't mean, they are of lower quality.

Long story short: I don't believe quality is subjective, since the qualitative attributes are mostly the same.

To me (high) growth, coupled with the other qualitative attributes, is the ultimate definition of quality. Because growth (as long as it's not at all costs) isn't just revenue going up. It tells you, the demand is there. Customers are running at them like crazy. Because the company is obviously doing something right. And these are the high quality companies I want to invest in.

I hope his answers your question!

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IamM's avatar

Hi Moritz,

Thank you for your clear answer! Wish you great success in the years ahead!

Just saw that LisaOnCloud9 is also writing for 'Happy investing'. Great contributor, indeed.

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