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Oddbjørn Dybvad (REQ Capital) - Acquisition-driven Compounders
Far From The Finishing Post
English - September 11, 2023 15:00 - 40 minutes - 28.1 MBInvesting Business troy asset management investing compounding wealth creation absolute returns money management asset management fund management learning finance Homepage Download Apple Podcasts Google Podcasts Overcast Castro Pocket Casts RSS feed
In this episode we speak to Oddbjørn Dybvad, co-founder of REQ Capital, an Oslo-based investment firm. Oddbjørn manages REQ’s Global Compounders and Nordic Compounders funds, which focus on acquisition-driven businesses. We discuss the entrepreneurial energy within these companies, why they are able to reinvest capital at attractive rates for a long period of time and how their diversified and decentralised nature makes them both resilient and adaptable.
Show notes:
[01:22] Oddbjørn discusses his career
[02:26] The risk and return characteristics of acquisition-driven compounders
[04:25] The influence of geography
[07:01] Defining the different types of serial acquirer
[09:12] Focusing on small/mid-caps with a long runway for redeploying capital
[10:41] The diversification benefits of acquisition-driven companies
[12:11] A preference for insider ownership, decentralisation and acquisitions funded by cash
[13:29] Communicating with investors in a different way
[14:53] Key person risk and the sustainability of culture
[16:28] Change at Diploma
[18:07] Harnessing entrepreneurial energy through decentralisation
[20:43] Decentralisation and adaptability
[21:59] Motivating behaviour through simple incentivisation structures
[24:52] Focusing on track record and management
[25:56] Constellation Software and the decentralisation of capital allocation
[28:07] The valuation differential between public and private markets
[30:51] The attractions of selling to acquisition-driven compounders
[33:06] Looking for the dual engine of organic and inorganic growth
[35:04] The underlying characteristics of REQ Global Compounders
[37:13] Becoming more conscious about evaluating risk and management
[39:07] Finding people who are process-oriented and have a long-term mind-set
[39:55] Learn from your mistakes