Episode 32: Dissecting Network Effects & Local Economies w/ Keith Smith, Bonhoeffer Capital

Macro-ops

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Keith Smith is the portfolio manager of Bonhoeffer Capital. Bonhoeffer is a global-oriented fund focused on finding compound mispricings across the capital structure. The fund looks for misunderstood businesses and poke around unconventional fishing holes on their quest for alpha generation.

Keith joins the show to discuss his investment process, local scale economies and finding hidden opportunities across the globe.

If you want to learn more about Keith, follow him on Twitter @Bonhoeffer_KDS. You can also check out his website here.

Here’s the show outline:

  • [1:33] Intro and Background on Keith
  • [6:05] Viewing Your Job as An Asset w/ Recurring Revenue
  • [13:03] What Keith’s Investments Looked Like in 1990s
  • [34:05] Why Keith Invests Across The Globe
  • [46:19] Investing in South Africa
  • [49:50] Compound Mispricings
  • [59:34] Investing in Businesses w/ Local Economies of Scale
  • [66:32] The Power of Wegman’s
  • [67:03] Bringing Local Economies To The Internet Economy
  • [76:13] Win-Win Investment Opportunities
  • [88:37] How Keith Finds Incentive Structures
  • [95:34] Fallibility & Changing Investment Models
  • [102:32] Closing Questions

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