MONETIZE QUALITY IP

“The point being, if I have to choose between upgrading TransDigm and maybe Copart to full 5% positions or selling them and taking Amazon from 5% to, let's say, a 9% position, I would actually go for the latter.”

“The Switch 2 launched in June last year and it sold 3.5 million units in the first four days online. So that's the fastest launch of any Nintendo console in its history. And by the end of December 2025, it had sold far more than 17 million units in just 7 months.”

“And so, the problems compounded through 2025 for them when the company first got on our radar. And you've seen revenue growth decelerate from 25% in Q1 to down to 14% by Q4 of 25. And then, with the most recent earnings just a few weeks ago, they actually did beat Wall Street estimates, but their guidance for Q1 2026 implied growth of only 10% year over year.”

“And then one of the craziest changes when looking at Reddit has just been the inflection and the margins of the business of net income margins in 2024 were negative 37%. And by 2025, a year later, they were 24% in the positive direction. So in Q4, we actually saw margins hit 34%.”

“That means you're buying those assets at a 60% discount to what they're actually worth on paper in the public markets. So if you just look at the Ferrari stake alone, which is about two-fifths of Exor's total net assets, it's worth almost the entire market cap of Exor because of that 60% discount.”

“So, managing calendars and bookings across multiple platforms ends up being more hassle than it's worth. So, they just pick Airbnb and stay there, and it also helps that Airbnb has this really smooth user-friendly interface. And that stickiness means a guest searching for a specific type of property in a specific location genuinely cannot always find it elsewhere.”

“Because once you own the rights to a song, you essentially own a perpetual royalty stream with almost zero marginal cost of production. So you don't need to manufacture anything. You don't need to run servers. You don't need to reprint the music every single time that somebody plays it. And that's why their free cash flow conversion is so astronomically high.”

“But in mid-2025, the FHFA, the regulator that oversees Fannie Mae and Freddie Mac, officially approved Vantage Score 4 as an alternative scoring model for those government-backed loans. And Vantage Score is owned jointly by the three major credit bureaus for context. So the very institutions that used to distribute FICO scores now have a competing product that they would love to push themselves.”