Thank You

I’m shutting down Implied Expectations and issuing pro-rata refunds to all paid subscribers. I started this subscription site in 2017 on a different platform, launched it in parallel on impliedexpectations.com in 2020, and again launched it in parallel on Substack in 2022.

I started IE to generate another revenue stream while my primary business was small. Now that my business is larger and this revenue stream is no longer a necessity, I’m reallocating time spent on writing for IE back to research.

In some ways, IE has been a labor of love because I love the research process. In other ways, I’m relieved to be off the hamster wheel and the obligation of writing something important when there isn’t always something important to write.

I’m grateful that a fair number of you found some value in my work. I hope it acted as a starting point for your own research and led you to one or more fruitful investments.

I will boil down my scars and the lessons learned from a couple decades-plus of investing into one takeaway:

This business and the media that surrounds it is constantly encouraging extremely short-term thinking. It is pervasive. But the real treasure can be found by using a long-term lens to evaluate high-quality business models, investing when the expectations implied by the stock price are far too pessimistic relative to even your most conservative plausible scenario, and then holding the shares through the inevitable ebbs and flows of the business and the stock while continuously re-underwriting the investment in light of its price.

The three prerequisites to this process are 1) understanding the business well enough to model its future in a range of plausible outcomes, 2) being able to value those cash flow streams, and 3) having enough experience, independence, and confidence in your judgement that you are able to a) stay the course when seemingly the whole world is shouting at you that you’re wrong but also b) the mental flexibility to change your mind if the critical facts change. That is a herculean task. No one always get it right. But it is possible to significantly improve as an investor with enough time, effort, and focus.

Thinking long-term should in no way relieve you of the need to continuously reassess a business’s progress. However, the best companies in which to invest have sufficiently durable competitive advantages and growth opportunities that changing your mind and selling them early should be the rare surprise.

Again, thank you.

Respectfully,

IE