字幕表 動画を再生する 英語字幕をプリント MALE SPEAKER: So welcome, everyone. My name is [INAUDIBLE], and I'm very pleased to welcome you for another special talk in our Value Investing series. We have a very special speaker with us today. But before I get into his introduction, I want to talk briefly about this term "moat," which you are going to be hearing a lot about in today's talk. Well, according to Wikipedia, a moat is a deep, broad, ditch, either dry or filled with water, that surrounds a castle, other building, or town, historically to provide it with a preliminary line of defense. However, thanks to Mr. Buffett and a legion of value investors, this word "moat" has become an excellent metaphor to identify companies with durable competitive advantage. Very few people, though, have managed to develop and synthesize a framework that systematically helps to identify moats from an investor's perspective. Pat Dorsey, our author for today, has done a great service to students and individual investors trying to do exactly that. In his bestselling book, "The Little Book That Builds Wealth," he has shared actionable insights to identify modes in the business world. His book is also a great introduction for anyone interested in learning more about value investing. We are very, very pleased to have Pat here with us. So without further ado, ladies and gentlemen, please join me in welcoming Pat Dorsey. [APPLAUSE] PAT DORSEY: Thanks for the kind intro. I'm glad we have the technology, at least working mostly, here in one of the world's most successful technology companies. [LAUGHTER] You would have thought I was presenting in Redmond, Washington. No, I'm joking. Sorry, sorry, it was just right down the middle. It was too easy. It was too easy. You give me a fat pitch, I'm going to hit it-- or invest in it, I suppose. So we've done the intros. I'm Pat. I used to run Morningstar's Equity Research Group, currently have my own investment firm called Dorsey Asset Management, which is a global firm, a global mandate. We can invest anywhere in the world, any market cap. We're very concentrated. And our goal really is to find 10 to 15 of the world's most competitively advantaged businesses that can compound at high rates overtime, invest in them, and then leave them alone to make lots of money over time. That's our job, and that's what we're actively engaged in doing right now. And the framework we use is in large part based on the work I did at Morningstar and the concept of economic moats and reinvesting capital at high rates of return. And that's what I want to talk about today. So the basic foundation of thinking about economic moats and competitive advantage is that-- shocker-- capitalism works, and that capital seeks the highest returns possible. If a company is making a lot of money, others will seek to compete with it. That intuitively make sense. If I wrote each of you a $50 million VC check and said, go start a business, you would probably try to do something profitable. If you are smart, you probably would not start airlines. [LAUGHTER] I hope. I hope. High profits attract competition, I mean, as surely as night follows day. So intuitively this makes sense. Empirically it makes sense as well. If you go back over time and look at, say, take T1, companies in the highest decile of returns on capital. Then roll the clock forward 10, 15 years and look at that cohort of companies. Most will have lower levels of profitability. Most will have lower returns on capital as their returns on capital have drifted down to some mean as competition has come in. Of course there is a minority of businesses where that's not the case. So most businesses you see high returns on capital decrease over time as competition comes in. However, there is a very small minority of businesses that enjoy many years of high returns on capital. They essentially beat the odds. They defy economic gravity. And the question simply becomes, how? And in my view, it's because they've created structural advantages, economic moats, a way of insulating themselves, buffering themselves against the competition, that enables them to maintain supernormal returns on capital longer than academic theory and the averages would suggest. Because absent a moat, competition destroys excess returns-- period, end, full stop. Any highly profitable business that is easy to compete with, you will see that come down over time-- very common in the fashion industry, very common, say, in if you guys remember back in NVIDIA, and what was the other big graphics company, chip company? [INAUDIBLE]? They would swap market shares like every six months. One had the best chip. Oh, now I've got the best chip. Do-do-do-do. And there's no moat there. The moat was just, what do I got that's great today? And then you had a lot of smart engineers at the other place trying to make the next best thing. So the basics of moats is that there are structural and sustainable qualities that are inherent to the business. A moat is part and parcel of the business that you're looking at. It's not a hot product. We all probably remember the Krispy Kreme debacle. They taste good, but sugar is not a moat. Heelys-- anybody remember Heelys or have a kid? Remember those little shoes with the wheel in the heel? That was an $800 million company at one point. I mean, yes, as Dave Barry would say, I am not making this up. People were valuing Heelys as if it had a moat. Aside from the massive product liability issues, once basically schools started banning them, that's a problem if your target audience of 12-year-olds can't buy your product anymore. And so that business went to hell pretty fast. It's not just a cool piece of technology. We talked about in video and the graphics companies a moment ago. Remember Iomega? Remember that was going to be the thing? It's just a cool piece of technology. And frankly, any cool piece of technology can be replicated by other smart engineers, unless there's some switch in cost, some lock-in effect that occurs or an industry standard is created. But anything that one smart bunch of guys can develop, there's probably another smart bunch of guys somewhere else trying to make it even better. And of course, it's not the biggest market share. You'll often hear companies talk about, oh, we're the biggest. We're going for market share. Let's think about GM. Let's think about Compaq. It didn't work out so well. Big is not a moat. In fact, small is often a better moat than big. Moats generally manifest themselves in pricing power. A company that can't raise prices is unlikely to have a strong moat. And in fact, if you invest, this is a test often that businesses are losing competitive advantage. If you have a company who typically raises prices 2%, 3%, 4% every year. They're able to kind of keep pricing power moving up. And then one year, suddenly they don't. They say, well, the economy's tough or we want to take it easy on the customers this year. That's a load of crap. It means that something has changed in that industry. There's a competitor out there. There is some event going on that you may not be aware of that's causing them to lose that pricing power. Because if you can take price, you will take prices as a business. And so companies that lose that pricing power, that's usually the first sign that their moat is eroding. So what I want to do next is talk about the four kinds of moats that I identified when we were at Morningstar and that I still think make sense today. The way we identified these was by going back, this would have been about 50 years of Compustat data, and it was pretty simple, just looking at businesses that had maintained returns on capital above cost of capital for 15 years plus. It's not a huge data set. And then you basically say, well, what are the common characteristics of these businesses? What are the similarities of these businesses? And that's where we kind of teased out these four categories. And they've proven to work out pretty well. We introduced the moat ratings at Morningstar in about '01. And so now we've had about 12, 13 years, and the business we initially identified as being wide-moat businesses that fell into these buckets have maintained higher returns on capital than their peers. So the empirical results seem to bear out the theory. The first kind of intangible asset is a brand. And a brand is valuable if it either increases your willingness to pay or lowers your search costs. And this is really important. It's not just that it's well known. Because you think about, say, Sony. We've all heard of Sony, right? Sony is often ranked as one of the 20 most valuable brands on the planet by the Business Week brand week thingy that happens every year. But let me just do a quick survey in this room. How many of you would pay 20% more for a Sony DVD player? One hand? Any hands? AUDIENCE: Maybe 15 years ago. PAT DORSEY: Maybe 15 years ago. That's exactly it. And right now you do see like the Sony Bravia TVs getting a little bit of a price premium over others. Because it's newer. DVDs were newer. But consumer electronics is fast-cycle stuff, right? What's new today is old next week. And so the fact that Sony is well known and we've heard a lot about it does not contribute one bit to its competitive advantage. In fact, I would argue Sony could probably save a heck of a lot of money by not advertising or advertising very little. On Michigan Ave in Chicago where I work, they have this super expensive flagship store with all kinds of cool stuff you can play with. And I'm sure they're paying God knows what in rent-- useless. Because that brand doesn't change your behavior. By contrast, let's look at Tiffany. Tiffany will charge you 20% more for the exact same diamond that you can buy from Blue Nile or Zales or Helzberg or wherever you want. 20% is the value of that pale blue box. I can guarantee you the cardboard ain't that expensive. [LAUGHTER] OK? But you know as the giver of a diamond, that you'll probably get a bigger smile off the recipient if it's in a Tiffany box than if it's not in a Tiffany box. So they can charge it. And so that brand has value, right? That brand increases your willingness to pay.