About Us
Welcome to Founders Research & Investment
Our mission is to research and invest in outstanding founder-led companies with the objective to help generate outstanding shareholder returns
Invest with founders
Founders start with a clean slate. They invest their own savings, they build teams, create differentiated products and services, and then convince customers to back them. Founders take ownership. Those who succeed have well proven their business acumen.
Successful founder-led businesses regularly possess durable competitive advantages. Their organizations are lean, their products and services innovative, frequently answering an unmet market need. But most importantly, they possess strategic clarity combined with a culture of flexibility and adaptation. Their long-term perspective sets them apart from many public company management teams, while their substantial stakes create alignment with outside shareholders. This can be a potent combination, resulting in long-term winning results for shareholders.
Successful founders are often unique personalities, driven to create businesses that outlive them. But a market opportunity is not exhausted simply because the founder eventually passes on the baton. A superior company is likely to maintain its excellence well beyond a single generation of management. This is why we also look for companies having been bestowed with a founder’s culture and alignment of interests, where its potential remains in the far future. We refer to this internally as founder-aligned businesses.
Founders take ownership. Those who succeed have well proven their business acumen.
Invest in great companies
Great companies deliver great value to their customers while generating great value for their shareholders.
We dedicate our analytical skills to identifying businesses that will stand the test of time, run by outstanding people. We focus on world-beating public companies, possessing lasting competitive advantages, with the conviction that over time, these companies will only grow stronger and deliver outstanding shareholder returns.
We look to identify those few exceptional companies whose businesses are highly differentiated from competitors’. These companies often deliver great value to their customers while generating great value for their shareholders too. They often exhibit characteristics reminiscent of quality companies, such as superior organic growth, high margins, revenue and earnings stability across the cycle, as well as high returns on invested capital. Typically, they also hold moderate amounts of net debt and keep their balance sheets efficient with net working capital and intangibles under control.
Management quality is the essential ingredient for long-term success in business, we believe. It encompasses everything from culture to capital allocation. Successful management teams demonstrably possess these qualities necessary to win in business, and many of the best businesses in history have been founder led. Good examples being Apple, Amazon, Samsung, LVMH and many more. As such, focusing on exceptional companies and founder-led businesses is naturally synergistic.
Nevertheless, a select few companies have also been extraordinarily successful well beyond the era of their founding shareholders, led by management teams which was been able to maintain their companies’ excellence over long periods of time. We like to think of such management teams as founder-aligned and will not hesitate to make room for them in our investment universe.
Invest in undervalued franchises
Valuation is an important factor for a successful investment, but one with many approaches and one subject to many opinions. We do not believe we can establish a meaningful valuation for a business with an uncertain future, low returns on capital employed or a weak business model. In that sense, our dedication to researching exceptional companies fits seamlessly with our goal of assessing intrinsic value, looking at least 5 years into the future.
Neither do we believe that short-term earnings or cash flows are necessarily a good basis for valuing a company. We prefer to look to a longer time horizon encompassing meaningful business opportunities, while taking competitive advantages and execution risks into account.
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Our valuation methodology is focused on long-term organic revenue growth and earnings potential, combined with earnings visibility, profitability & cash flow generation, capital repatriation and balance sheet strength.
We focus on long-term organic EPS growth, combined with visibility, balance sheet strength and capital repatriation