Deep Value in Europe, Shareholder Activism, Stag Hunts, and Value Traps with Iggy on Investing
Summary
Investment Strategy: Iggy, known as Iggy on Investing, employs a disciplined deep value strategy inspired by Buffett and Graham, focusing on small, illiquid companies trading at substantial discounts to book value, particularly in overlooked European markets.
Market Insights: The podcast discusses the inefficiencies in European markets, where Iggy finds opportunities in companies with strong ROIC and catalysts, emphasizing the importance of staying within one's circle of competence and scrutinizing corporate governance.
Shareholder Activism: Iggy shares his experience with shareholder activism in a "stag hunt" scenario, highlighting the challenges and strategies involved in coordinating minority shareholders to block unfavorable corporate actions.
Company Analysis: The discussion includes specific examples of companies like Anexo PLC and Card Factory, illustrating the complexities and potential of deep value investing in European stocks.
Community Building: Iggy is actively building an investor community in Europe, hosting events like the Benelux investor meetup to foster networking and idea exchange among value investors.
Key Takeaways: The podcast emphasizes the importance of thorough research, patience, and the willingness to learn from experiences in the pursuit of successful deep value investing.
Transcript
This podcast is forformational purposes only and is not an offer or solicitation of an offer to buy or sell securities. SNN network, SNN Inc. and the Plano Microcap podcast and the representatives are not licensed brokers, broker dealers, market makers, investment bankers, investment adviserss, analysts, or underwriters. We do not recommend any companies discussed. We may buy and sell securities in any company mentioned and make profit in the event those securities rise in value. We recommend you consult with a professional investment advisor, broker, or legal counsel before purchasing or selling any securities referenced in this podcast. Welcome to the Planet Micro Cap podcast. I'm your host, Robert Craft. Thank you all so much for the continued support and for tuning in. If you like what you hear on Planet Microap podcast, please take a moment to rate us five stars on Spotify or Apple Podcast. It really helps more folks discover the show and join the Micro Cap investing community. Registration is now open for the Planet Micro Cap Showcase Toronto in partnership with Micro Cap Club happening October 21 through 23, 2025 at the Arcadian Loft in downtown Toronto. Whether you're a seasoned investor or just getting started, you'll want to be there. Visit planetmapshowcase.com to register. See you in Toronto. Now, my guest on the show today is Iggy, better known as Iggy on Investing, a deep value investor and blogger. In this episode, Iggy shares how the CO 19 lockdown gave him the time to dive into investing, turning inspiration from Buffett and Graham into a disciplined deep value strategy focused on small illquid companies trading at substantial discounts to book value. We discuss his young Buffett style approach uh seeking firms at 3x to.5x book with strong ROIC and catalyst especially in overlooked European markets as well as his the role his blog plays in clarifying his thinking building conviction and holding through long boring periods. Iggy also walks us through hard-learned lessons from the importance of staying within your circle of competence and scrutinizing corporate governance to navigating shareholder activism in a quote unquote stag hunt scenario. And he shares how he's building an investor community in Europe, including hosting his second annual Benux, I'm sure I'm butchering that, so I'm going to try one more time, the second annual Benu Benyl Lux investor event on Saturday, September 27, 2025. For more information to register, you can go on his Substack. That's Iggy onst Iggy oninvesting.substack.com. Thank you again for tuning in to the Planet Microap podcast and please enjoy my conversation with Iggy on investing. Iggy, thank you for joining me today. How you doing, man? >> I'm doing very well. Thanks for having me. Pleasure to talk to you. >> Absolutely. It's great to have you. And I I'm just going to say right now for those watching on our YouTube, this is the greatest mustache I think we've ever had on the Planet MicroCat podcast is just full just just perfect. Look at that, dude. That's amazing. But uh look, I've been a follower for a while reading the blog and everything. So I apologize for this being, you know, long overdue at this point. So I appreciate you coming on. >> Ah, no worries. No worries. Uh if you would have had me uh on a year ago, it would have been way too soon. I'm still learning in public. That's also what the blog is about. So, uh, >> yeah, just thanks for having me and I think the timing is perfect. >> Absolutely. No, that's Listen, we can learn together right now. You know, we'll talk through a couple things. Maybe we can learn more about each other. You know, we can really really do a deep dive therapy session and see, you know, where we end up or or not end up nowhere. It's about the journey. Anyways, so uh love to start off. This is the main question I ask everybody to, you know, kickstart things here, but love to know where your passion for investing began and then how you got to where we're currently at today. >> Yeah. So I think my passion for investing started I think as for many people who are a bit younger around 2020 because suddenly you had a boatload of time on your hands to finally teach yourself some of the stuff you've been want to get into cuz I'd known for example about Buffett right he was already very very famous when I was young but I think I might have even already read intelligent investor I had it on my bookshelf but just never got to it and then during 2020 I finally had this sort of impulse to start learning about it. And another thing that happened is that I had quit my previous student job uh I think right before Corona. And then the other thing I did with my time is I send a lot of open uh letters to a lot of companies to see if I could get a job and I got a very very funny job at a private bank where I basically help them do lead acquisition by sending cakes to uh clients. So nothing financially based but was a very funny sort of uh side job to do. But through this job I met all these private bankers that had some spare money. Uh I sat with them in a room and 50% of the time uh well a bit more hopefully they were talking to their clients and the other 50% of the time they were gambling their money away in the market and I realized wait so this is what retail investors are really like. Uh I think Buffett might have something to say with markets are not that efficient. So I think the combination of having time to um study actually and teach yourself some stuff and seeing uh how the actual market participants behave sometimes uh gave me the sort of confidence to start investing. >> Awesome. Listen, I have to ask though, you know, what what kind of cakes were you sending out? >> Anything. Anything. Uh they were willing to pay big bucks for the cake. So we just got the the best local baker in any village and I just had to call them up with uh please send a cake to here and here and uh the invoice will get paid so don't worry. >> Nice. Nice. Did it work? Did it actually convert a few few folks or did it? >> Yeah. Yeah. Yeah. I mean if for for big accounts stuff like this works right. You send them something personal. And of course what you should not forget is uh in these sort of big emotional financial decisions maybe the wife also plays a role. And I think the wife really likes the cake. >> Did you ever have a moment where you accidentally got the wrong name on the cake, you know, so that they're like, "Wait, who's who's this? This isn't Gustaf's house." Like, what are you talking about? >> Yeah, wrong house for sure once or twice because there's sort of a way in the Netherlands to guess where somebody lives, but it can be wrong. And I I and I had one or two typos where uh my boss got angry that I spelled the company name wrong or something. >> By the way, perfect. I use my working name as my to to be local with it. Was is Gustaf is a is it's a it's a local name, right? A lot of No, not a lot of Gustavs. No. >> No, no, no. We're big with the Yans. >> Jans. I should have said Yans. Dang it. Ah, >> yon works everywhere in Europe. Gustaf more the north and the east, I think. >> Oh, really? Ah, dang it. Oh, okay. All right. That's good to know. For next time, I need a Netherlands themed type joke. Okay, that's good to know. >> Yeah. Yeah. Yeah. So, >> actually Yankees, if you know Yankees. So, >> Oh, I don't know that one. from uh from New York are called is because there were a lot of Dutch settlers there of course called Young Case. So Yankees is actually uh yeah sort of a ruining of a Dutch name, Young Case. >> Well, that happens to be the name of my favorite baseball team. So I'll I'll based on how this season going, it's like it's like oh that's per very appropriate right now. But anyways, >> okay. >> So how do So okay, so you saw so it sounds like really you obviously you know you had a little bit of time on your hands. you're seeing like okay these guys are you know bankers basically and you know that are people are entrusting with their money to manage or you know just keep secure safe all that and here they are investing in the markets in a very uh how we should say lair way so to speak and >> they're private money by the way they were not gambling away right their own bonuses were different play >> right but what I but I love that you what you gleaned from that was that hey I can do this too like these guys are supposed to be the professionals and they're just, you know, taking shots with their own private money. So, it's that that's really cool that you were able to be like, "All right, I could probably do this based on how what I'm seeing here." >> Yeah. Exactly. Exactly. >> Very cool. So, how did that translate then? So, okay, you saw I can do this. What What did What did you deep dive into? Did you finally read the intelligent investor? Is that what was that the first step? I'm assuming. >> Yeah, I I think a lot. So for sure the intelligent investor and I think you must have remembered because you were probably already active in the space. I think the financial YouTubing space was very very active in 2020. So >> very active >> there was a lot of people to listen to. There were a lot of books recommended uh infinite amount of podcast by uh Monry to listen to old Burkshshire meaning. So, uh, lots of books, lots of self-arning. And I think one of the things I thought at the time, and I still think, and I think we're 5 years later now, is that the market seemed to be in a bit of a frenzy when it came to the large caps cuz all the stimulus and all that. So, uh, I decided, well, what did Young Buffett do? You look at smaller illquid companies, discount to book, etc., which I think has worked decently for me, but ignoring the large cap stocks of course over the last five years has not necessarily been uh the best decision. Um and basically like that and I thought at some point um people say go fishing where the fish are and then preferably I would also like there to be no fisherman where the fish are. So I remember one of uh the first things I did which I think defined a little bit my writing online because people associate me a bit with Polish stocks which is weird of course for a Dutch guy but I remember looking up and I think we didn't have CH GPT yet so it should have been Google the number of publicly listed companies per uh country and I think I divided them then by their total population and Poland was very very high and I had never heard of a listed Polish company. So, uh, I pulled up one of the data providers and got a list of Polish stocks and then it was like shooting fish in a barrel. There were so so many cheap names, especially, uh, during the Ukraine war, etc. So, that's a bit how I got started. >> Very cool. Yeah. No, I'm I mean going back to your point about the YouTube stuff. I mean like usually people find us after they've read one up on Wall Street or and and dug in really dug into the Buffett books and see that one line where he's like, "Oh, if I was a retail investor today, I would be in, you know, small micro caps and then they find us after after they've done the deep dive." But uh cool. So I mean what then inspired you to start the Substack? I mean, sounds like you're kind of starting to dig it a little deeper, but I mean, what what then got Iggy on Investing going? >> Yeah. So, I think what happened one year in is that my name's his name slips my mind now, but the guy who runs the beer cave substack, what is he called? Do you know? >> Oh, Edwin. Yeah. >> Yes. Adwin. He hosted a stock pitch competition for students and I was a student at that time and I thought, well, that's a nice try or a nice opportunity. So I submitted a Polish nano cap called uh Monari trade which was exceptionally cheap to put in to perspective how inefficient the Polish market was at that time and it's not become that much more efficient but at least a bit more expensive. This company at the time was trading for 75 million Polish slotties and I just opened up their news flow and it said something like uh real estate holdings sold for 80 million Polish slotties. I looked how much of the real estate did they sell? Oh, only 50%. They also had an operating company running clothing stores and that you basically got for free. So I pitched that stock trading for deeply below book would receive its market cap and cash while nothing would happen to its business and uh yeah that's uh how I started writing full disclosure sold this stock by now but it's still moderately attractive but uh >> one of the first things I wrote about and going into basically writing that article opened my mind to oh it's both very very useful to write about stocks because it helps you de sort clarify your thoughts yourself. Plus, it would just be, I think, very fun to get more feedback in public. >> 100%. And you know the one thing that you know when I when I first came into this and I think you know a lot of folks also experienced is that you know if you're really putting in a lot of work and time and effort into you know putting yourself out there and writing and sharing your ideas everyone you for on the whole is um very gracious with their time and also provide really high quality feedback for the most part you know I mean it especially if you're sharing you know again if you're putting in the work even if it's an idea that's absolutely absolutely hated. If you're actually showing that you put time and effort into your thesis and really worked hard on like trying to understand what it is, like even the best of the best will be like, "Hey, not maybe not a fan of the idea, but you actually put a lot of time and effort and here's maybe where we can chat or learn from there or something like that." So, I'm sure you experienced that. >> Yeah, absolutely. It's my number one tip to anybody starting. You can do it anonymously if you don't like to have your face out there, but start writing or putting your IDs out somewhere because it's really, really useful. It will open up doors, new connections, you'll learn a lot. Will be painful, but I mean, no pain, no gain, right? So, >> just make sure you disclose. >> True. Make sure >> if I'm going to put my compliance hat on, you know, just disclose. That's that's that's the the number one thing. So, you know, I want I'm going to dig into the blog a little bit because there's a few articles that I went to dig deeper on that I I I really liked and you know, I had a couple follow-ups, but you know, for you, just so that folks understand, I mean, you know, you sound very much on the deep value, Buffett, that kind of that style, but you know, what what's an ideal setup, you know, investing setup for you just for so folks have a better idea of your philosophy and your strategy? >> Yeah, for now indeed, looking at my track records, I think it's deep history and might be or sorry, deep history, deep value and might be deep value going forward. For me that was a bit how I saw the times. I thought uh all these high-f flyier stocks seem a bit pricey. I don't know. I need to know a lot about the business to um justify these valuations. So let's start digging in simpler stuff that uh I can understand. Maybe in the future I find some stuff trading at 10 15p that will grow a lot and I'm very open to buy them. Just haven't found them yet. But indeed for now the sort of deep value setups I like the best are stocks that sort of go one step up over this Monari trades because this Monari trade for example deep discount to book clear catalyst etc. Uh and that catalyst did partially close the stock price but what I like best is actually companies selling below book but where I'm quite confident that they will earn their return of on capital. So that makes it for me very easy to hold the stock um for medium long term. So a stock I still own is called interlife general insurance. I purchased it I think at 60% of book value and it had compounded book uh close to 19% historically. So even if the future was a bit worse in the 10 12% ratio if you buy it at such a deep discount to book it's not that hard holding it. So that's I think what I like most. uh they're rare, but sometimes you just find something selling at a deep discount which you think has an excellent history and no reason to believe its future will be different. So they can keep compounding or earning good returns and pay it out in dividends to you and you'll be happy. >> Absolutely. Hey, real quick, when it comes to your investing universe or the you know where you like to go hunting, is do you tend to stay European or do you also look at US, Canada, all that stuff too? >> Um both. I if I screen I almost always screen Europe because I just think if you go A to Z there there's more opportunity but I also do I think what most people do. I read the value investors club. I read Substack. I listen to your podcast. I listen to Andrew Walk or anybody else. If something in the US or Canada comes flying by that I like I'll buy it. Something else that I owned in the past for example is Lee Industries. Not the greatest pitch. did make some money on it um by pure luck because there's of course a lot of volatility in uh listed equity stocks. But I've I've I've dabbled a bit in the US and Canada in the past. But if it's an original ID, so one I just found by going into much more likely to be uh Europe just because I think it's more worthwhile there to turn over stones as a private investor. >> Very cool. Yep. No, by the way, Andrew is the man. Love that podcast. Um so >> he also had a good mustache at some point. He did have a solid mustache and that Yeah, I'm sure you know how the no shade November. I'm sure it'll come back for November. Uh I wish mine would look that cool. It's just like yours is like a thick blonde. Mine it just >> I think you have very good growth. I think if you grow it out >> it's a wispy blonde. It's not a thick blonde on the mustache if you catch my drift. It just it'll look more scraggly than it would be thick. Like you look like you're ready to go like you know take over the high seas. It's like mine would like I'd probably be looking like I I should be cleaning the deck, you know, and that that's not a good look. My wife would not like that. Um, okay. >> So, >> number one question for anybody who wants to grow a mustache. Anybody will ask you the first thing they see you with the mustache is how does your wife or girlfriend like it? Number one question always. Be prepared. Be prepared. >> Exactly. See, I just go I just I I always keep the beard and then just it allows me to, you know, be a little more nimble. You know, we could go shorter beard, longer beard. Anyways, no one really cares about it. But anyways, um you going now let's get into the blog a little bit. You know, you have this article that you just published very recently about, you know, 11 stocks, 15 pitches two and a half years later. So, it's kind of kind of reflection on, you know, pitches that you put out there. Uh all your writings from the last two and a half years on IGON investing on Substack. You know, the one question I had that I pulled up after, you know, going through the article and whatnot, you know, when you're revisiting a stock idea years later, and I'm surprised I've never asked this on the pod before, but I'm I'm curious your thoughts. How did how do you when you're thinking about this, how do you separate a poor thesis from poor timing? >> All right, dig it in. Here we go. Maybe I I can start on the thesis because I know when a thesis is poor cuz one of the things for example I do in the the article u which I sort of like for myself is looking at uh so how much have these companies produced in earnings right I say they're cheap and were they cheap in the end and uh in in a decent hit rate I think they they were cheap they in in two years time they produced north of 30% for example of their market cap and earnings I think they are well below 10p I think that's a good pitch if I was kind of right on the fundamentals. Um, poor timing, hard to say. I know what good timing is. Lee, I had a bit of luck. I purchased something with a weirdsis and uh some speculative buyers got in and pushed the stock up. Uh, I think on the upside, luck is very obvious. On the downside, it's very very hard to say for me when when the timing is wrong. Uh, can be very frustrating. But, uh, for a thesis to me, it's kind of easy, right? If you you have an opinion on what will the fundamentals of the business do and if that's in the same ballpark as what you predicted, I think you can say you were kind of right. >> I mean overall I what would you say over the last two and a half years, you know, since you get going and and really digging in. What have been some of the main takeaways, the main things that you've learned to help refine your thesis further? I know we only have an hour, but you know, we can >> I was I was I was actually thinking about this this morning. Many of the laurels for any of the new investors that people teach you are right. So stay in your circle of confidence 100% right. Any of the stocks that I've lost money on, I did a week of research. I thought ah this looks cheap and u half a year later the thing is down 50% cuz I understood nothing of where this thing was cyclic or what customer concentration really did to this company. So stay in your circle of confidence is 100% true. The writing will help a lot with that. So also some of the names I lost a lot of money on. I was not confident enough to write up and that should have been sign one that I should have sold. Other stuff you can't make a good deal with bad people. My recent experience with Anexo still hold a small small couple of shares after the buyback uh has really taught me that that you cannot make a good deal with bad people. We can get into that cuz it's an interesting journey if you want. But uh many of the laurels that the big people like Buffett, any of the other value investors who do a lot of speaking teach you are are true. So listen to them. Take take them as granted wisdom because they're true. >> Absolutely. No, that I I hear that. Um, I mean when we what would you say was the how your how your just your style has evolved, you know, in the last two and a half years? Like what do you put a little bit more emphasis on when you're doing your deep dive research, you know, or or not? You know, things that you thought were important maybe that aren't important anymore. Maybe things you thought were important are actually like really important and you're, you know, putting even more effort into it. You know, I love to hear your more thoughts there. Yeah, I think one of the things I realized in doing the write up you spoke about about all the stocks I did is uh in my deep value style, valuation matters and it matters a lot. There's a lot of defense in depth and then especially in the earnings I think cuz I looked back at some of the stocks and I looked at my own prediction and I said uh the stock trades forward PE of three. Well, I was wrong. The turned out to be six. So was way off, but I mean if the stock then trades to a P of 10, you made 40% uh you had a 40% gain. So there's a lot of defense in depth if you buy companies cheap enough, which I think if you're not buying the greatest companies matters a lot. So if you can just search hard far and wide and find very very cheap stuff, that works I think cuz you don't need to be that right. If something is 3P or 6P, you'll probably make money in both situations. And it als it also seems like discipline is a main part of your process as well, right? Where you're just like, "All right, it it's up 30%. It's not like that great of a name. It has something interesting, but it's already, you know, so it sounds like there's a mix of also figuring out like, okay, which one is truly like a long long-term investment versus something that might be more of a quick trade like not necessarily like day trading, but just, you know, you know the idea, you get it, you see what's going on. it maybe it got, you know, written up somewhere else. It, you know, went up 30%. You're like, "All right, this wasn't accurate. Fine. I I'll take my 30% and go on from there. If it goes up, great. If not, like, okay, >> I'm good." >> Maybe one of the other big learnings for other people who are newer to this game, holding stuff for a long term is is much harder than reading it in a book. Cuz you see Buffett or somebody, if you read one of his biographies, hold a stock, it goes up 3, 4x over 5, six years. reading those two pages took you 5 minutes. Living five years is very slow, very boring. And I think for me the most painful stock with this has been um a stock I've written a lot about called Card Factory, a UK retailer that is very good customer reviews. I think uh going seven, eight years strong. It's the number one value for money retailer in the UK. And it's one of these stocks that I found when I just started investing uh trading at what I thought was if co stopped normalized P of three. So I thought well that's quite interesting. Took a small position because there was some risk they were going to delist or not delist um dilute because they were uh having problem with their banking syndicate. Of course they wanted to see more money. Well at some point um they resolved the problems with their banking syndicate. So I thought well easy money no chance of delusion. and I bought a bigger position and like I said if you buy cheap enough you make money so it went from 3p to six but I think it's a very well-run retailer I like this management they prevented the delusion they seem well aligned the stock now has been flat 2 years on 6P or something I still hold it I received big dividends but I would have thought by now reading the books that the stock would be up you know but holding it in real life is much much more boring and much harder and frustrating than uh you might think. >> 100%. Iggy, how old are you, if you don't mind me asking? >> I'm 25. >> Okay, this this explains a lot. I remember my my mentality at 25. The last thing I was thinking about was like, "Oh, this is a sick investment I'm going to hold for for sure 10 years." You know, you're like, "Right." I mean, I'm sure you've thought about that, too. Like, how do you check like, "Okay, I'm 25." Like, "All right, I'm trying I I I like there's so many different opportunities and I want to just attack everything but like you know how how do I mentally get past the like I'm you know 25 and just wanting to like you know go go crush it and things happen you know instantly versus like hey this might take a bit of time for this thesis to mature and you know it might go up little by little and you know all that stuff like how how do you how do you check yourself behaviorally in that sense on the investing side I'm not >> to be to be honest it's not the hardest thing I've struggled with like not been that tempted to sell. I've just been mainly frustrated like I'm I'm cooking inside. Like why is all this stuff going off except my stuff. I think some of the things that help is for one, I'm 25. I'm not a full-time professional, so I have a full-time job on well, I wanted to say on the side, but I guess it's my main thing. So I'm not looking at the Bloomberg terminal all day, which might help. >> Yes, that definitely does. Otherwise, I think this this writing stuff actually both on the positive side helping you hold stuff and on the negative side creating commitment bias. If you wrote written about a stock three times, nothing changed. It's a bit awkward to go publicly like um sorry guys uh found a new mistress um flying on. So, I guess on that side also the the writing helps. >> Definitely. Yeah. No, keeping a journal on all of it just to keep your head straight so you're not, you know, especially if you know, if you're very confident with these, you've done the homework, you're like, "All right, this is, you know, this is one I want to hold, you know, if you know the TE's as well, if you're like, okay, 6P, but I think it's a quality company, it's also comfortable hold, right?" >> Yeah. Oh, no. 100%. So, I mean, and I think this I forgot the name of the article that, but there was one thing you talked about the concept of stag hunt um to describe shareholder dynamics. Can you what does that mean? Give me I've never heard that before. >> I but I if if I want to talk about that we need to go a little bit of context and it's an active situation but what I can do is uh tell about one of my recent experiences in public markets which might also be instructive to people. >> Please go for it. >> So I have been analyzing a company in the UK called anexo plc. They do something very peculiar to the UK where if somebody has a motoring accident and they are minimally insured, they can get a replacement vehicle, but they would have to fund it themselves, but they are not able to to pay it themselves cuz they're called impunious, which is a posh way of saying poor. And then these law firms come in that basically finance the vehicle for you and then sue the uh insurance party on the other side of the accident. So they basically help no fault motorist uh get a replacement vehicle. They pay for the vehicle, they charge a rate for the vehicle and they try to get it back from uh the other insurer. This is a bit of a capital heavy business because while you put all this upfront investment in, you sue the other insurer and it will take you one one and a half two years to get your money back. And well, this was one of those companies that we talked about earlier that I really really like. It was selling at uh.5 times book when I started studying it and it had been compounding book value north of 15%. And there were some big catalysts I think on the horizon in the form of a new business line where they did a similar model but then for housing disrepair and they had done um they have participated in claims against the big auto manufacturings with the diesel gate. So basically they collected a lot of claims and then at some point Mercedes, Volkswagen etc will have to pay out an extra big sum which was not reflected on the balance sheet. what was reflected on the balance sheet was a normal business and this was deeply deeply below book. Then your president did his little what was it called? I want to call it independence day. What was the tariff day called? >> Uh I don't know. I I blanked that out cuz it was 3 weeks before our conference in Vegas and you know everything went to for a little bit. So I was just like I this this isn't happening you know like >> we were raising freedom remember but I think it was called like was it freedom day or I don't know tariff day. It was something day but something day happened and old stock markets tanked a good 10 15% I don't remember how big it was awesome we loved it was so fun it was great it was great two days we loved it >> well I had some cash so I felt like a genius and bought this stock at.3 times or.3 times book what happens 5 days after I buy the stock at.3 times book a independent news outlet in the UK leaks that the majority owners uh basically the founders and a private equity firm that held 30% stake wanted to buy the company. Well, normally stocks show the top 20%, you feel quite smart. But there was a catch. They were not paying in any form of cash. They just wanted to put no new cash into the business. And basically, they leaked that you were either going to get unlisted Bshares. So basically, you lost your voting rights, you lost your public market access, and well, there you go. So you're in a private equity vehicle or you got um yeah loan notes another unlisted sort of um instrument >> and this pissed me off and this pissed pissed off a lot a lot a lot of shareholders and um at that point I thought well I have this blog let's see if we can get these shareholders together so I started promoting on Twitter on everything um to get these shareholders together I worked sort without this game theory aspect that you were mentioning, how can we block this bit cuz it's it's evil. So what we or what I concluded is that if minorities can sort of coordinate in some form of manner or at least communicate their intent to vote a certain way, we can win because um for people who don't know, AIM has an incredibly low D-listing threshold that sort of majority owners can hold over your head. It's only at 75%. You might know, Robert, what what is it in Canada? It's much higher, I hope. >> No. Well, at least then some people would have tried. >> Yeah. >> For people who care in normal countries, it's 90. I've never seen lower than 90 anywhere else. >> And the insiders held 63% of the share. So, we needed around 20% of the of the total free float of the company to sort of win a D-listing vote. And that also would have made it without the threat of delisting, it would have probably been hard for them to force these um these unlisted instruments upon us. So that's basically where you get into a stack hunt. That's a concept from game theory. Everybody always calls everything a prisoner's dilemma. It is not. This was not a prisoner's dilemma. It's a different type of game called a stag hunt. And a stag hunt is a coordination game. So two hunters, they can do two things. They can either hunt a hair alone, which well it's kind of easy. You take your shotgun out and you can probably shoot the hair all on your own. And that has some positive payoff, say one. They can also together go tracking, spend a day, and kill a stag, which you would then have to take back together, of course, for a much much higher payout. This is a coordination game because you need to hunt the stag together. If one person goes hunting the hair, he will still have the same payoff. That's getting the hair. If the one hunter goes hunting the stag alone, he gets nothing. So, it's a negative payoff. And it was the same here. We if the minorities could work together, we could have sort of killed the stag which would have been not being forced into this terrible deal. And if you act on your own, you would always get the same payout, namely the the private deal. So this worked I think nicely in theory and at some point we got up to very very big numbers with shareholders sort of getting into our shareholder tally etc. because there was a nice list of big holders that you get out there with the the form 8K or no it's a form at least a form 8 I think in the UK and then plus a very big group of minorities that we found on Twitter I I think at some point we would have been likely to stop the vote but what happened consequently which is uh kind of sad and we're still questioning the legality is that the board approved a buyback for 50% of your shares. So, not what we hoped because if we pushed them for a full cash offer, it would have at least been a win for us. But it was a buyback structured where anybody could uh sell at least 50% of their shares. By the way, at a horrible price that uh even their independent financial advisor said this is an unfair price. I've never seen that happen in public markets, but uh Grand Tor and uh independent financial advisor that this is not a fair price on any measure and we cannot sign off on it. But the board did it was I think 20% below the last market price. So this board not independent is a clear sort of case of poor corporate governance. But there was another catch with this 50% is that anybody who didn't elect those shares could still be bought back from other shareholders. So basically they structured it in exactly a way where they would get 75.1% of the shares and they could always win the D-listing vote. So there was nothing we could do. They managed to scatter sort of the shareholder base and in the end we didn't win this fight. So for now to me it looks like the deal will go through. There are some other avenues that could still help us but they're a bit late. Takeover panel in the UK could still intervene. There are five uh members of parliament in the UK who've written the trade commission about it but for now it looks like the deal will go through. >> So at what point when you're going through this process do you have to ask yourself all right is the is it worth it? you know, because like we I talk about that a lot with folks that, you know, maybe didn't ever intentionally want to get into the activism game and then now they're just like, yeah, like, well, yep, we ended up, you know, cuz I it it seems like in this case it's it could go either, you know, you're it's it's a lot of brain drain. >> Yes. No, no, it took a bit more energy than it should. I think there my 25-year-old showed. I I sort of just dove in head first and didn't reflect that much I think during the process >> and again you have the same problem that I talked about before writing it helps you commit but once once I have a group of 100 minority shareholders with we're going to do this it's kind of hard to say uh going on a holiday for the next half a year somebody else picks it picked this up >> or or even just being like all right I'm I'm dumping here's you know I'll take my my ride off here you go or not you know like It it's it's tough when you're like fully pot committed and like you it sounds like you were kind of leading the charge to to to you know try and get this thing not done. >> Yeah. >> Yeah. >> No, it was another painful but uh at least the experience where I learned a lot. >> What I'm that was my that was going to be my next question like what what were some of the things that you feel like you really you know took from this experience or I mean it's still ongoing in a lot of ways but you know what what what have you learned from this? What did I take for this? Like I already said earlier, you cannot do a good deal with bad people. Something Buffett says. Well, I said his laurels are always true. Um, I don't know if I was blind. I don't know if I could have seen this before. That's sometimes the hard part. I There were only very minor clues for me that something like this could happen. Although the private equity party in there was known to do kind of aggressive deals. So I should have paid more attention to the the major shareholders. It opened my eyes a lot to the role of board members. I I look normally at management and I say well since they've been here they have excellent track record, good capital allocation, etc. I notice in this case the board was supposed to protect us and they didn't. So I will spend a bit more time in the future looking at the board members. do they seem truly independent etc. cuz that was a very painful here. And another thing I took away and I've seen this happen more often with large private owners. There's no way they don't understand the buyback. They they say we don't do this. They're we like the dividend whatever. They always understand the buyback, but it only happens when the buyback is them buying back the whole company. Because that's what happened here. The the shareholders cuz the stock had been below booked for a long time. shareholders had been pestering them in private like just buy back some shares because either you write one new claim or you buy back the shares and you're buying back two claims so it's better they understand why a buyback would be beneficial they're just not going to do it unless it's them buying back the whole company very often same thing happened with shinoen a long or a long time ago I think that was in 2020 2021 Japanese company a lot of value investors were in it uh 50% of book excellent track record No buyback, no buyback. Owner steps up, buys back the whole company. Yeah. >> Yeah. It's it's sounds like it sounds like you're the moral of the story is like if I don't have to do activist activism again, uh that would I' I'd be >> true true. On the other hand, it opened my eyes because I was surprised how many people you can get together. But I mean there was a catalyst to drive people together. And also what's nice is too like I mean you know this is kind of a maybe not necessarily an afterthought but like look at all like how much more of a community you've built probably by just networking with all these different people that you know probably have saw the same thing saw the same value you know so now you have a whole network of other folks that you can always bounce ideas off too you know like that's >> that's worth it just you know the price of admission at least a little bit there. Mhm. One other thing I I learned from this which is a bit about the market plumbing and sort of the inefficient marketerial. What was very interesting to me was seeing that cuz we had the share at some point, right? And then we could see the owners own 60%, they think it's undervalued. Large holders think it's undervalued. They hold um 19%. We have another 6% of smaller holders in uh in this group. They all think it's undervalued. That means that that whole undervaluation that you see in the public market is driven by the sort of 9% of people who are left who are just trading these shares over and going everywhere. So it did open also my eyes a bit for how the market plumbing works and why indeed sort of auction-driven markets are so inefficient cuz the stock price is not set by the the 90% of people holding the stock who understand it well. It's driven by the 10% gambling on the stock. So, it's kind of interesting to really see. >> Very, very good. So, Iggy, you know, I wanted to close out with um just talked a lot about experience here and lessons learned and everything like that. You know, I figured there was the one other piece or you know, we talked about deep value, devalue frameworks. you know, in in your two and a half years, you know, and change getting into investing, you know, for you, how do you how do you avoid your value trap situations, you know, and really like, okay, this is more this has more substance versus just, you know, it being something that I might get caught up in. >> Yeah. How do you avoid avoid value traps? I think for you >> Yeah. Yeah. For me, Yeah. Yeah. Yeah. For me it is a bit in this sort of track record of producing decent ROIC and capital investment decisions. So this Monari stock that I owned it was my first lesson in okay if there's a discount to book it can close a bit but then also nothing can happen for 2 three years because nothing is happening with the capital. you turn into a Japanese company. But if you search, if you turn over a lot of rocks, you'll find some companies that are cheap and doing useful stuff with the with the money they create. So, if you buy cheap enough and it keeps compounding, doesn't even need to be at all that high a rate, you are sort of sure to earn some form of return and makes holding much much easier. >> Very good. All right. Well, Iggy, I think we're we're pretty much there. You know, we were talking offline a little bit about, you know, you also host meetups um where where you are. So, can you tell us a little bit about your your local meetups and stuff? >> Yes. So, I was kind of jealous somewhere mid last year looking at you hosting events. I think Ian Castle host events. There's the big Birkshshire meetup and then to me Europe is sort of like a desert on that front. >> I mean, could you name a I know one other big I know Value X does they do they do Exactly. Guy Guy Spear like they're they're always doing some cool stuff. >> Yeah, but I think those are invite only for fund managers or something. I don't think they're the easiest thing to get into. So to me it felt like a bit of a desert for young guys or private investors like me to meet up. So I decided it's not that hard to rent a hotel and get some people together. So let's try. So we did the first one last year and it was a big success. hosted a nice ID dinner after that where people pitched some great stocks and then we're going to do the next one the 27th of September in >> two fund managers coming to speak Sam Hold on there is quite uh well known I think in the value investing community in Europe and Yasper Brebbart from uh value squared also very very excited fund who's going to speak and then there will be many guys already know coming who are very smart private investors so anybody interested in value investing micro caps. Please come to these events. Uh there are incredibly fun ways to meet new people, learn about new ideas. >> Absolutely. No, that's that's awesome. I Man, I didn't I wish I didn't live so far. I'm in LA, you know. I very It's a little It's a little far, but uh Well, >> one American. >> Oh, don't get Listen, I will say this. Don't get jealous. Just come. You know, we're going to be in Toronto. you know, it's a little closer, you know. >> Yeah. >> And we'll be in Vegas in mid June. So, we'll give you some time to, you know, organize. We'll be, you know, you'll >> you might Lizzy, >> is there Ryionaire to Las Vegas? >> I think so. >> I don't think so. But maybe at least to Iceland. You'll get to Iceland. You >> to Iceland and then Southwest or something. >> Yeah, exactly. But they're doing a signed seating now with Southwest. So, you know what? You'll you'll at least know exactly where you're sitting. It'll be fine. But, um, cool. Well, Iggy, with that, where can our audience go and find more information to follow you on Substack as well as all your social media? >> Yes. Um, Iggy on investing everywhere. So, you can go to Twitter, you find Iggy on Investing, not Iggy Asalia, not Iggy Pop, just Ignon investing. Um, there there will also be a link to my Substack, but my substinvesting.substack.com. There you can find all my writeups. uh so the dev value ids you can find announcement about the events and one other fun thing I do that some of your readers might like is I sometimes do case studies of uh public investors which I think are very fun to do one that's why I do them but I think quite useful so one I did is uh I took all public letters by smoke capital I just said okay what stock did he pitch what was the ID and what happened afterward and then I think it's a nice way to sort of learn about these grades in the micro cap space so if you're into that also Give those a read. I'm currently doing a whole series on Jeremy Raper. He started adding pictures after I started writing about him, so I don't know if I'm ever going to finish. >> Did you write him? Be like, "Dude, slow down a little bit, man. I'm trying to I'm trying to write a whole expose in a good way on you. Come on." >> Exactly. Exactly. But he started adding old pictures. He just took stuff that wasn't public like, "Okay, Iggy, write about this as well." >> Oh, he said, "Oh, cool. You're in contact with him because that's that's he's he's a great dude." >> Yeah, he's very nice. He's very nice. >> Very cool. All right. Well, Iggy, thanks again for joining me. This was awesome. Really do appreciate it and I look forward to having you on again at at some point in the future. >> For sure. Lots of fun. Thanks for having me. >> Thanks, Iggy. [Music]
Deep Value in Europe, Shareholder Activism, Stag Hunts, and Value Traps with Iggy on Investing
Summary
Transcript
This podcast is forformational purposes only and is not an offer or solicitation of an offer to buy or sell securities. SNN network, SNN Inc. and the Plano Microcap podcast and the representatives are not licensed brokers, broker dealers, market makers, investment bankers, investment adviserss, analysts, or underwriters. We do not recommend any companies discussed. We may buy and sell securities in any company mentioned and make profit in the event those securities rise in value. We recommend you consult with a professional investment advisor, broker, or legal counsel before purchasing or selling any securities referenced in this podcast. Welcome to the Planet Micro Cap podcast. I'm your host, Robert Craft. Thank you all so much for the continued support and for tuning in. If you like what you hear on Planet Microap podcast, please take a moment to rate us five stars on Spotify or Apple Podcast. It really helps more folks discover the show and join the Micro Cap investing community. Registration is now open for the Planet Micro Cap Showcase Toronto in partnership with Micro Cap Club happening October 21 through 23, 2025 at the Arcadian Loft in downtown Toronto. Whether you're a seasoned investor or just getting started, you'll want to be there. Visit planetmapshowcase.com to register. See you in Toronto. Now, my guest on the show today is Iggy, better known as Iggy on Investing, a deep value investor and blogger. In this episode, Iggy shares how the CO 19 lockdown gave him the time to dive into investing, turning inspiration from Buffett and Graham into a disciplined deep value strategy focused on small illquid companies trading at substantial discounts to book value. We discuss his young Buffett style approach uh seeking firms at 3x to.5x book with strong ROIC and catalyst especially in overlooked European markets as well as his the role his blog plays in clarifying his thinking building conviction and holding through long boring periods. Iggy also walks us through hard-learned lessons from the importance of staying within your circle of competence and scrutinizing corporate governance to navigating shareholder activism in a quote unquote stag hunt scenario. And he shares how he's building an investor community in Europe, including hosting his second annual Benux, I'm sure I'm butchering that, so I'm going to try one more time, the second annual Benu Benyl Lux investor event on Saturday, September 27, 2025. For more information to register, you can go on his Substack. That's Iggy onst Iggy oninvesting.substack.com. Thank you again for tuning in to the Planet Microap podcast and please enjoy my conversation with Iggy on investing. Iggy, thank you for joining me today. How you doing, man? >> I'm doing very well. Thanks for having me. Pleasure to talk to you. >> Absolutely. It's great to have you. And I I'm just going to say right now for those watching on our YouTube, this is the greatest mustache I think we've ever had on the Planet MicroCat podcast is just full just just perfect. Look at that, dude. That's amazing. But uh look, I've been a follower for a while reading the blog and everything. So I apologize for this being, you know, long overdue at this point. So I appreciate you coming on. >> Ah, no worries. No worries. Uh if you would have had me uh on a year ago, it would have been way too soon. I'm still learning in public. That's also what the blog is about. So, uh, >> yeah, just thanks for having me and I think the timing is perfect. >> Absolutely. No, that's Listen, we can learn together right now. You know, we'll talk through a couple things. Maybe we can learn more about each other. You know, we can really really do a deep dive therapy session and see, you know, where we end up or or not end up nowhere. It's about the journey. Anyways, so uh love to start off. This is the main question I ask everybody to, you know, kickstart things here, but love to know where your passion for investing began and then how you got to where we're currently at today. >> Yeah. So I think my passion for investing started I think as for many people who are a bit younger around 2020 because suddenly you had a boatload of time on your hands to finally teach yourself some of the stuff you've been want to get into cuz I'd known for example about Buffett right he was already very very famous when I was young but I think I might have even already read intelligent investor I had it on my bookshelf but just never got to it and then during 2020 I finally had this sort of impulse to start learning about it. And another thing that happened is that I had quit my previous student job uh I think right before Corona. And then the other thing I did with my time is I send a lot of open uh letters to a lot of companies to see if I could get a job and I got a very very funny job at a private bank where I basically help them do lead acquisition by sending cakes to uh clients. So nothing financially based but was a very funny sort of uh side job to do. But through this job I met all these private bankers that had some spare money. Uh I sat with them in a room and 50% of the time uh well a bit more hopefully they were talking to their clients and the other 50% of the time they were gambling their money away in the market and I realized wait so this is what retail investors are really like. Uh I think Buffett might have something to say with markets are not that efficient. So I think the combination of having time to um study actually and teach yourself some stuff and seeing uh how the actual market participants behave sometimes uh gave me the sort of confidence to start investing. >> Awesome. Listen, I have to ask though, you know, what what kind of cakes were you sending out? >> Anything. Anything. Uh they were willing to pay big bucks for the cake. So we just got the the best local baker in any village and I just had to call them up with uh please send a cake to here and here and uh the invoice will get paid so don't worry. >> Nice. Nice. Did it work? Did it actually convert a few few folks or did it? >> Yeah. Yeah. Yeah. I mean if for for big accounts stuff like this works right. You send them something personal. And of course what you should not forget is uh in these sort of big emotional financial decisions maybe the wife also plays a role. And I think the wife really likes the cake. >> Did you ever have a moment where you accidentally got the wrong name on the cake, you know, so that they're like, "Wait, who's who's this? This isn't Gustaf's house." Like, what are you talking about? >> Yeah, wrong house for sure once or twice because there's sort of a way in the Netherlands to guess where somebody lives, but it can be wrong. And I I and I had one or two typos where uh my boss got angry that I spelled the company name wrong or something. >> By the way, perfect. I use my working name as my to to be local with it. Was is Gustaf is a is it's a it's a local name, right? A lot of No, not a lot of Gustavs. No. >> No, no, no. We're big with the Yans. >> Jans. I should have said Yans. Dang it. Ah, >> yon works everywhere in Europe. Gustaf more the north and the east, I think. >> Oh, really? Ah, dang it. Oh, okay. All right. That's good to know. For next time, I need a Netherlands themed type joke. Okay, that's good to know. >> Yeah. Yeah. Yeah. So, >> actually Yankees, if you know Yankees. So, >> Oh, I don't know that one. from uh from New York are called is because there were a lot of Dutch settlers there of course called Young Case. So Yankees is actually uh yeah sort of a ruining of a Dutch name, Young Case. >> Well, that happens to be the name of my favorite baseball team. So I'll I'll based on how this season going, it's like it's like oh that's per very appropriate right now. But anyways, >> okay. >> So how do So okay, so you saw so it sounds like really you obviously you know you had a little bit of time on your hands. you're seeing like okay these guys are you know bankers basically and you know that are people are entrusting with their money to manage or you know just keep secure safe all that and here they are investing in the markets in a very uh how we should say lair way so to speak and >> they're private money by the way they were not gambling away right their own bonuses were different play >> right but what I but I love that you what you gleaned from that was that hey I can do this too like these guys are supposed to be the professionals and they're just, you know, taking shots with their own private money. So, it's that that's really cool that you were able to be like, "All right, I could probably do this based on how what I'm seeing here." >> Yeah. Exactly. Exactly. >> Very cool. So, how did that translate then? So, okay, you saw I can do this. What What did What did you deep dive into? Did you finally read the intelligent investor? Is that what was that the first step? I'm assuming. >> Yeah, I I think a lot. So for sure the intelligent investor and I think you must have remembered because you were probably already active in the space. I think the financial YouTubing space was very very active in 2020. So >> very active >> there was a lot of people to listen to. There were a lot of books recommended uh infinite amount of podcast by uh Monry to listen to old Burkshshire meaning. So, uh, lots of books, lots of self-arning. And I think one of the things I thought at the time, and I still think, and I think we're 5 years later now, is that the market seemed to be in a bit of a frenzy when it came to the large caps cuz all the stimulus and all that. So, uh, I decided, well, what did Young Buffett do? You look at smaller illquid companies, discount to book, etc., which I think has worked decently for me, but ignoring the large cap stocks of course over the last five years has not necessarily been uh the best decision. Um and basically like that and I thought at some point um people say go fishing where the fish are and then preferably I would also like there to be no fisherman where the fish are. So I remember one of uh the first things I did which I think defined a little bit my writing online because people associate me a bit with Polish stocks which is weird of course for a Dutch guy but I remember looking up and I think we didn't have CH GPT yet so it should have been Google the number of publicly listed companies per uh country and I think I divided them then by their total population and Poland was very very high and I had never heard of a listed Polish company. So, uh, I pulled up one of the data providers and got a list of Polish stocks and then it was like shooting fish in a barrel. There were so so many cheap names, especially, uh, during the Ukraine war, etc. So, that's a bit how I got started. >> Very cool. Yeah. No, I'm I mean going back to your point about the YouTube stuff. I mean like usually people find us after they've read one up on Wall Street or and and dug in really dug into the Buffett books and see that one line where he's like, "Oh, if I was a retail investor today, I would be in, you know, small micro caps and then they find us after after they've done the deep dive." But uh cool. So I mean what then inspired you to start the Substack? I mean, sounds like you're kind of starting to dig it a little deeper, but I mean, what what then got Iggy on Investing going? >> Yeah. So, I think what happened one year in is that my name's his name slips my mind now, but the guy who runs the beer cave substack, what is he called? Do you know? >> Oh, Edwin. Yeah. >> Yes. Adwin. He hosted a stock pitch competition for students and I was a student at that time and I thought, well, that's a nice try or a nice opportunity. So I submitted a Polish nano cap called uh Monari trade which was exceptionally cheap to put in to perspective how inefficient the Polish market was at that time and it's not become that much more efficient but at least a bit more expensive. This company at the time was trading for 75 million Polish slotties and I just opened up their news flow and it said something like uh real estate holdings sold for 80 million Polish slotties. I looked how much of the real estate did they sell? Oh, only 50%. They also had an operating company running clothing stores and that you basically got for free. So I pitched that stock trading for deeply below book would receive its market cap and cash while nothing would happen to its business and uh yeah that's uh how I started writing full disclosure sold this stock by now but it's still moderately attractive but uh >> one of the first things I wrote about and going into basically writing that article opened my mind to oh it's both very very useful to write about stocks because it helps you de sort clarify your thoughts yourself. Plus, it would just be, I think, very fun to get more feedback in public. >> 100%. And you know the one thing that you know when I when I first came into this and I think you know a lot of folks also experienced is that you know if you're really putting in a lot of work and time and effort into you know putting yourself out there and writing and sharing your ideas everyone you for on the whole is um very gracious with their time and also provide really high quality feedback for the most part you know I mean it especially if you're sharing you know again if you're putting in the work even if it's an idea that's absolutely absolutely hated. If you're actually showing that you put time and effort into your thesis and really worked hard on like trying to understand what it is, like even the best of the best will be like, "Hey, not maybe not a fan of the idea, but you actually put a lot of time and effort and here's maybe where we can chat or learn from there or something like that." So, I'm sure you experienced that. >> Yeah, absolutely. It's my number one tip to anybody starting. You can do it anonymously if you don't like to have your face out there, but start writing or putting your IDs out somewhere because it's really, really useful. It will open up doors, new connections, you'll learn a lot. Will be painful, but I mean, no pain, no gain, right? So, >> just make sure you disclose. >> True. Make sure >> if I'm going to put my compliance hat on, you know, just disclose. That's that's that's the the number one thing. So, you know, I want I'm going to dig into the blog a little bit because there's a few articles that I went to dig deeper on that I I I really liked and you know, I had a couple follow-ups, but you know, for you, just so that folks understand, I mean, you know, you sound very much on the deep value, Buffett, that kind of that style, but you know, what what's an ideal setup, you know, investing setup for you just for so folks have a better idea of your philosophy and your strategy? >> Yeah, for now indeed, looking at my track records, I think it's deep history and might be or sorry, deep history, deep value and might be deep value going forward. For me that was a bit how I saw the times. I thought uh all these high-f flyier stocks seem a bit pricey. I don't know. I need to know a lot about the business to um justify these valuations. So let's start digging in simpler stuff that uh I can understand. Maybe in the future I find some stuff trading at 10 15p that will grow a lot and I'm very open to buy them. Just haven't found them yet. But indeed for now the sort of deep value setups I like the best are stocks that sort of go one step up over this Monari trades because this Monari trade for example deep discount to book clear catalyst etc. Uh and that catalyst did partially close the stock price but what I like best is actually companies selling below book but where I'm quite confident that they will earn their return of on capital. So that makes it for me very easy to hold the stock um for medium long term. So a stock I still own is called interlife general insurance. I purchased it I think at 60% of book value and it had compounded book uh close to 19% historically. So even if the future was a bit worse in the 10 12% ratio if you buy it at such a deep discount to book it's not that hard holding it. So that's I think what I like most. uh they're rare, but sometimes you just find something selling at a deep discount which you think has an excellent history and no reason to believe its future will be different. So they can keep compounding or earning good returns and pay it out in dividends to you and you'll be happy. >> Absolutely. Hey, real quick, when it comes to your investing universe or the you know where you like to go hunting, is do you tend to stay European or do you also look at US, Canada, all that stuff too? >> Um both. I if I screen I almost always screen Europe because I just think if you go A to Z there there's more opportunity but I also do I think what most people do. I read the value investors club. I read Substack. I listen to your podcast. I listen to Andrew Walk or anybody else. If something in the US or Canada comes flying by that I like I'll buy it. Something else that I owned in the past for example is Lee Industries. Not the greatest pitch. did make some money on it um by pure luck because there's of course a lot of volatility in uh listed equity stocks. But I've I've I've dabbled a bit in the US and Canada in the past. But if it's an original ID, so one I just found by going into much more likely to be uh Europe just because I think it's more worthwhile there to turn over stones as a private investor. >> Very cool. Yep. No, by the way, Andrew is the man. Love that podcast. Um so >> he also had a good mustache at some point. He did have a solid mustache and that Yeah, I'm sure you know how the no shade November. I'm sure it'll come back for November. Uh I wish mine would look that cool. It's just like yours is like a thick blonde. Mine it just >> I think you have very good growth. I think if you grow it out >> it's a wispy blonde. It's not a thick blonde on the mustache if you catch my drift. It just it'll look more scraggly than it would be thick. Like you look like you're ready to go like you know take over the high seas. It's like mine would like I'd probably be looking like I I should be cleaning the deck, you know, and that that's not a good look. My wife would not like that. Um, okay. >> So, >> number one question for anybody who wants to grow a mustache. Anybody will ask you the first thing they see you with the mustache is how does your wife or girlfriend like it? Number one question always. Be prepared. Be prepared. >> Exactly. See, I just go I just I I always keep the beard and then just it allows me to, you know, be a little more nimble. You know, we could go shorter beard, longer beard. Anyways, no one really cares about it. But anyways, um you going now let's get into the blog a little bit. You know, you have this article that you just published very recently about, you know, 11 stocks, 15 pitches two and a half years later. So, it's kind of kind of reflection on, you know, pitches that you put out there. Uh all your writings from the last two and a half years on IGON investing on Substack. You know, the one question I had that I pulled up after, you know, going through the article and whatnot, you know, when you're revisiting a stock idea years later, and I'm surprised I've never asked this on the pod before, but I'm I'm curious your thoughts. How did how do you when you're thinking about this, how do you separate a poor thesis from poor timing? >> All right, dig it in. Here we go. Maybe I I can start on the thesis because I know when a thesis is poor cuz one of the things for example I do in the the article u which I sort of like for myself is looking at uh so how much have these companies produced in earnings right I say they're cheap and were they cheap in the end and uh in in a decent hit rate I think they they were cheap they in in two years time they produced north of 30% for example of their market cap and earnings I think they are well below 10p I think that's a good pitch if I was kind of right on the fundamentals. Um, poor timing, hard to say. I know what good timing is. Lee, I had a bit of luck. I purchased something with a weirdsis and uh some speculative buyers got in and pushed the stock up. Uh, I think on the upside, luck is very obvious. On the downside, it's very very hard to say for me when when the timing is wrong. Uh, can be very frustrating. But, uh, for a thesis to me, it's kind of easy, right? If you you have an opinion on what will the fundamentals of the business do and if that's in the same ballpark as what you predicted, I think you can say you were kind of right. >> I mean overall I what would you say over the last two and a half years, you know, since you get going and and really digging in. What have been some of the main takeaways, the main things that you've learned to help refine your thesis further? I know we only have an hour, but you know, we can >> I was I was I was actually thinking about this this morning. Many of the laurels for any of the new investors that people teach you are right. So stay in your circle of confidence 100% right. Any of the stocks that I've lost money on, I did a week of research. I thought ah this looks cheap and u half a year later the thing is down 50% cuz I understood nothing of where this thing was cyclic or what customer concentration really did to this company. So stay in your circle of confidence is 100% true. The writing will help a lot with that. So also some of the names I lost a lot of money on. I was not confident enough to write up and that should have been sign one that I should have sold. Other stuff you can't make a good deal with bad people. My recent experience with Anexo still hold a small small couple of shares after the buyback uh has really taught me that that you cannot make a good deal with bad people. We can get into that cuz it's an interesting journey if you want. But uh many of the laurels that the big people like Buffett, any of the other value investors who do a lot of speaking teach you are are true. So listen to them. Take take them as granted wisdom because they're true. >> Absolutely. No, that I I hear that. Um, I mean when we what would you say was the how your how your just your style has evolved, you know, in the last two and a half years? Like what do you put a little bit more emphasis on when you're doing your deep dive research, you know, or or not? You know, things that you thought were important maybe that aren't important anymore. Maybe things you thought were important are actually like really important and you're, you know, putting even more effort into it. You know, I love to hear your more thoughts there. Yeah, I think one of the things I realized in doing the write up you spoke about about all the stocks I did is uh in my deep value style, valuation matters and it matters a lot. There's a lot of defense in depth and then especially in the earnings I think cuz I looked back at some of the stocks and I looked at my own prediction and I said uh the stock trades forward PE of three. Well, I was wrong. The turned out to be six. So was way off, but I mean if the stock then trades to a P of 10, you made 40% uh you had a 40% gain. So there's a lot of defense in depth if you buy companies cheap enough, which I think if you're not buying the greatest companies matters a lot. So if you can just search hard far and wide and find very very cheap stuff, that works I think cuz you don't need to be that right. If something is 3P or 6P, you'll probably make money in both situations. And it als it also seems like discipline is a main part of your process as well, right? Where you're just like, "All right, it it's up 30%. It's not like that great of a name. It has something interesting, but it's already, you know, so it sounds like there's a mix of also figuring out like, okay, which one is truly like a long long-term investment versus something that might be more of a quick trade like not necessarily like day trading, but just, you know, you know the idea, you get it, you see what's going on. it maybe it got, you know, written up somewhere else. It, you know, went up 30%. You're like, "All right, this wasn't accurate. Fine. I I'll take my 30% and go on from there. If it goes up, great. If not, like, okay, >> I'm good." >> Maybe one of the other big learnings for other people who are newer to this game, holding stuff for a long term is is much harder than reading it in a book. Cuz you see Buffett or somebody, if you read one of his biographies, hold a stock, it goes up 3, 4x over 5, six years. reading those two pages took you 5 minutes. Living five years is very slow, very boring. And I think for me the most painful stock with this has been um a stock I've written a lot about called Card Factory, a UK retailer that is very good customer reviews. I think uh going seven, eight years strong. It's the number one value for money retailer in the UK. And it's one of these stocks that I found when I just started investing uh trading at what I thought was if co stopped normalized P of three. So I thought well that's quite interesting. Took a small position because there was some risk they were going to delist or not delist um dilute because they were uh having problem with their banking syndicate. Of course they wanted to see more money. Well at some point um they resolved the problems with their banking syndicate. So I thought well easy money no chance of delusion. and I bought a bigger position and like I said if you buy cheap enough you make money so it went from 3p to six but I think it's a very well-run retailer I like this management they prevented the delusion they seem well aligned the stock now has been flat 2 years on 6P or something I still hold it I received big dividends but I would have thought by now reading the books that the stock would be up you know but holding it in real life is much much more boring and much harder and frustrating than uh you might think. >> 100%. Iggy, how old are you, if you don't mind me asking? >> I'm 25. >> Okay, this this explains a lot. I remember my my mentality at 25. The last thing I was thinking about was like, "Oh, this is a sick investment I'm going to hold for for sure 10 years." You know, you're like, "Right." I mean, I'm sure you've thought about that, too. Like, how do you check like, "Okay, I'm 25." Like, "All right, I'm trying I I I like there's so many different opportunities and I want to just attack everything but like you know how how do I mentally get past the like I'm you know 25 and just wanting to like you know go go crush it and things happen you know instantly versus like hey this might take a bit of time for this thesis to mature and you know it might go up little by little and you know all that stuff like how how do you how do you check yourself behaviorally in that sense on the investing side I'm not >> to be to be honest it's not the hardest thing I've struggled with like not been that tempted to sell. I've just been mainly frustrated like I'm I'm cooking inside. Like why is all this stuff going off except my stuff. I think some of the things that help is for one, I'm 25. I'm not a full-time professional, so I have a full-time job on well, I wanted to say on the side, but I guess it's my main thing. So I'm not looking at the Bloomberg terminal all day, which might help. >> Yes, that definitely does. Otherwise, I think this this writing stuff actually both on the positive side helping you hold stuff and on the negative side creating commitment bias. If you wrote written about a stock three times, nothing changed. It's a bit awkward to go publicly like um sorry guys uh found a new mistress um flying on. So, I guess on that side also the the writing helps. >> Definitely. Yeah. No, keeping a journal on all of it just to keep your head straight so you're not, you know, especially if you know, if you're very confident with these, you've done the homework, you're like, "All right, this is, you know, this is one I want to hold, you know, if you know the TE's as well, if you're like, okay, 6P, but I think it's a quality company, it's also comfortable hold, right?" >> Yeah. Oh, no. 100%. So, I mean, and I think this I forgot the name of the article that, but there was one thing you talked about the concept of stag hunt um to describe shareholder dynamics. Can you what does that mean? Give me I've never heard that before. >> I but I if if I want to talk about that we need to go a little bit of context and it's an active situation but what I can do is uh tell about one of my recent experiences in public markets which might also be instructive to people. >> Please go for it. >> So I have been analyzing a company in the UK called anexo plc. They do something very peculiar to the UK where if somebody has a motoring accident and they are minimally insured, they can get a replacement vehicle, but they would have to fund it themselves, but they are not able to to pay it themselves cuz they're called impunious, which is a posh way of saying poor. And then these law firms come in that basically finance the vehicle for you and then sue the uh insurance party on the other side of the accident. So they basically help no fault motorist uh get a replacement vehicle. They pay for the vehicle, they charge a rate for the vehicle and they try to get it back from uh the other insurer. This is a bit of a capital heavy business because while you put all this upfront investment in, you sue the other insurer and it will take you one one and a half two years to get your money back. And well, this was one of those companies that we talked about earlier that I really really like. It was selling at uh.5 times book when I started studying it and it had been compounding book value north of 15%. And there were some big catalysts I think on the horizon in the form of a new business line where they did a similar model but then for housing disrepair and they had done um they have participated in claims against the big auto manufacturings with the diesel gate. So basically they collected a lot of claims and then at some point Mercedes, Volkswagen etc will have to pay out an extra big sum which was not reflected on the balance sheet. what was reflected on the balance sheet was a normal business and this was deeply deeply below book. Then your president did his little what was it called? I want to call it independence day. What was the tariff day called? >> Uh I don't know. I I blanked that out cuz it was 3 weeks before our conference in Vegas and you know everything went to for a little bit. So I was just like I this this isn't happening you know like >> we were raising freedom remember but I think it was called like was it freedom day or I don't know tariff day. It was something day but something day happened and old stock markets tanked a good 10 15% I don't remember how big it was awesome we loved it was so fun it was great it was great two days we loved it >> well I had some cash so I felt like a genius and bought this stock at.3 times or.3 times book what happens 5 days after I buy the stock at.3 times book a independent news outlet in the UK leaks that the majority owners uh basically the founders and a private equity firm that held 30% stake wanted to buy the company. Well, normally stocks show the top 20%, you feel quite smart. But there was a catch. They were not paying in any form of cash. They just wanted to put no new cash into the business. And basically, they leaked that you were either going to get unlisted Bshares. So basically, you lost your voting rights, you lost your public market access, and well, there you go. So you're in a private equity vehicle or you got um yeah loan notes another unlisted sort of um instrument >> and this pissed me off and this pissed pissed off a lot a lot a lot of shareholders and um at that point I thought well I have this blog let's see if we can get these shareholders together so I started promoting on Twitter on everything um to get these shareholders together I worked sort without this game theory aspect that you were mentioning, how can we block this bit cuz it's it's evil. So what we or what I concluded is that if minorities can sort of coordinate in some form of manner or at least communicate their intent to vote a certain way, we can win because um for people who don't know, AIM has an incredibly low D-listing threshold that sort of majority owners can hold over your head. It's only at 75%. You might know, Robert, what what is it in Canada? It's much higher, I hope. >> No. Well, at least then some people would have tried. >> Yeah. >> For people who care in normal countries, it's 90. I've never seen lower than 90 anywhere else. >> And the insiders held 63% of the share. So, we needed around 20% of the of the total free float of the company to sort of win a D-listing vote. And that also would have made it without the threat of delisting, it would have probably been hard for them to force these um these unlisted instruments upon us. So that's basically where you get into a stack hunt. That's a concept from game theory. Everybody always calls everything a prisoner's dilemma. It is not. This was not a prisoner's dilemma. It's a different type of game called a stag hunt. And a stag hunt is a coordination game. So two hunters, they can do two things. They can either hunt a hair alone, which well it's kind of easy. You take your shotgun out and you can probably shoot the hair all on your own. And that has some positive payoff, say one. They can also together go tracking, spend a day, and kill a stag, which you would then have to take back together, of course, for a much much higher payout. This is a coordination game because you need to hunt the stag together. If one person goes hunting the hair, he will still have the same payoff. That's getting the hair. If the one hunter goes hunting the stag alone, he gets nothing. So, it's a negative payoff. And it was the same here. We if the minorities could work together, we could have sort of killed the stag which would have been not being forced into this terrible deal. And if you act on your own, you would always get the same payout, namely the the private deal. So this worked I think nicely in theory and at some point we got up to very very big numbers with shareholders sort of getting into our shareholder tally etc. because there was a nice list of big holders that you get out there with the the form 8K or no it's a form at least a form 8 I think in the UK and then plus a very big group of minorities that we found on Twitter I I think at some point we would have been likely to stop the vote but what happened consequently which is uh kind of sad and we're still questioning the legality is that the board approved a buyback for 50% of your shares. So, not what we hoped because if we pushed them for a full cash offer, it would have at least been a win for us. But it was a buyback structured where anybody could uh sell at least 50% of their shares. By the way, at a horrible price that uh even their independent financial advisor said this is an unfair price. I've never seen that happen in public markets, but uh Grand Tor and uh independent financial advisor that this is not a fair price on any measure and we cannot sign off on it. But the board did it was I think 20% below the last market price. So this board not independent is a clear sort of case of poor corporate governance. But there was another catch with this 50% is that anybody who didn't elect those shares could still be bought back from other shareholders. So basically they structured it in exactly a way where they would get 75.1% of the shares and they could always win the D-listing vote. So there was nothing we could do. They managed to scatter sort of the shareholder base and in the end we didn't win this fight. So for now to me it looks like the deal will go through. There are some other avenues that could still help us but they're a bit late. Takeover panel in the UK could still intervene. There are five uh members of parliament in the UK who've written the trade commission about it but for now it looks like the deal will go through. >> So at what point when you're going through this process do you have to ask yourself all right is the is it worth it? you know, because like we I talk about that a lot with folks that, you know, maybe didn't ever intentionally want to get into the activism game and then now they're just like, yeah, like, well, yep, we ended up, you know, cuz I it it seems like in this case it's it could go either, you know, you're it's it's a lot of brain drain. >> Yes. No, no, it took a bit more energy than it should. I think there my 25-year-old showed. I I sort of just dove in head first and didn't reflect that much I think during the process >> and again you have the same problem that I talked about before writing it helps you commit but once once I have a group of 100 minority shareholders with we're going to do this it's kind of hard to say uh going on a holiday for the next half a year somebody else picks it picked this up >> or or even just being like all right I'm I'm dumping here's you know I'll take my my ride off here you go or not you know like It it's it's tough when you're like fully pot committed and like you it sounds like you were kind of leading the charge to to to you know try and get this thing not done. >> Yeah. >> Yeah. >> No, it was another painful but uh at least the experience where I learned a lot. >> What I'm that was my that was going to be my next question like what what were some of the things that you feel like you really you know took from this experience or I mean it's still ongoing in a lot of ways but you know what what what have you learned from this? What did I take for this? Like I already said earlier, you cannot do a good deal with bad people. Something Buffett says. Well, I said his laurels are always true. Um, I don't know if I was blind. I don't know if I could have seen this before. That's sometimes the hard part. I There were only very minor clues for me that something like this could happen. Although the private equity party in there was known to do kind of aggressive deals. So I should have paid more attention to the the major shareholders. It opened my eyes a lot to the role of board members. I I look normally at management and I say well since they've been here they have excellent track record, good capital allocation, etc. I notice in this case the board was supposed to protect us and they didn't. So I will spend a bit more time in the future looking at the board members. do they seem truly independent etc. cuz that was a very painful here. And another thing I took away and I've seen this happen more often with large private owners. There's no way they don't understand the buyback. They they say we don't do this. They're we like the dividend whatever. They always understand the buyback, but it only happens when the buyback is them buying back the whole company. Because that's what happened here. The the shareholders cuz the stock had been below booked for a long time. shareholders had been pestering them in private like just buy back some shares because either you write one new claim or you buy back the shares and you're buying back two claims so it's better they understand why a buyback would be beneficial they're just not going to do it unless it's them buying back the whole company very often same thing happened with shinoen a long or a long time ago I think that was in 2020 2021 Japanese company a lot of value investors were in it uh 50% of book excellent track record No buyback, no buyback. Owner steps up, buys back the whole company. Yeah. >> Yeah. It's it's sounds like it sounds like you're the moral of the story is like if I don't have to do activist activism again, uh that would I' I'd be >> true true. On the other hand, it opened my eyes because I was surprised how many people you can get together. But I mean there was a catalyst to drive people together. And also what's nice is too like I mean you know this is kind of a maybe not necessarily an afterthought but like look at all like how much more of a community you've built probably by just networking with all these different people that you know probably have saw the same thing saw the same value you know so now you have a whole network of other folks that you can always bounce ideas off too you know like that's >> that's worth it just you know the price of admission at least a little bit there. Mhm. One other thing I I learned from this which is a bit about the market plumbing and sort of the inefficient marketerial. What was very interesting to me was seeing that cuz we had the share at some point, right? And then we could see the owners own 60%, they think it's undervalued. Large holders think it's undervalued. They hold um 19%. We have another 6% of smaller holders in uh in this group. They all think it's undervalued. That means that that whole undervaluation that you see in the public market is driven by the sort of 9% of people who are left who are just trading these shares over and going everywhere. So it did open also my eyes a bit for how the market plumbing works and why indeed sort of auction-driven markets are so inefficient cuz the stock price is not set by the the 90% of people holding the stock who understand it well. It's driven by the 10% gambling on the stock. So, it's kind of interesting to really see. >> Very, very good. So, Iggy, you know, I wanted to close out with um just talked a lot about experience here and lessons learned and everything like that. You know, I figured there was the one other piece or you know, we talked about deep value, devalue frameworks. you know, in in your two and a half years, you know, and change getting into investing, you know, for you, how do you how do you avoid your value trap situations, you know, and really like, okay, this is more this has more substance versus just, you know, it being something that I might get caught up in. >> Yeah. How do you avoid avoid value traps? I think for you >> Yeah. Yeah. For me, Yeah. Yeah. Yeah. For me it is a bit in this sort of track record of producing decent ROIC and capital investment decisions. So this Monari stock that I owned it was my first lesson in okay if there's a discount to book it can close a bit but then also nothing can happen for 2 three years because nothing is happening with the capital. you turn into a Japanese company. But if you search, if you turn over a lot of rocks, you'll find some companies that are cheap and doing useful stuff with the with the money they create. So, if you buy cheap enough and it keeps compounding, doesn't even need to be at all that high a rate, you are sort of sure to earn some form of return and makes holding much much easier. >> Very good. All right. Well, Iggy, I think we're we're pretty much there. You know, we were talking offline a little bit about, you know, you also host meetups um where where you are. So, can you tell us a little bit about your your local meetups and stuff? >> Yes. So, I was kind of jealous somewhere mid last year looking at you hosting events. I think Ian Castle host events. There's the big Birkshshire meetup and then to me Europe is sort of like a desert on that front. >> I mean, could you name a I know one other big I know Value X does they do they do Exactly. Guy Guy Spear like they're they're always doing some cool stuff. >> Yeah, but I think those are invite only for fund managers or something. I don't think they're the easiest thing to get into. So to me it felt like a bit of a desert for young guys or private investors like me to meet up. So I decided it's not that hard to rent a hotel and get some people together. So let's try. So we did the first one last year and it was a big success. hosted a nice ID dinner after that where people pitched some great stocks and then we're going to do the next one the 27th of September in >> two fund managers coming to speak Sam Hold on there is quite uh well known I think in the value investing community in Europe and Yasper Brebbart from uh value squared also very very excited fund who's going to speak and then there will be many guys already know coming who are very smart private investors so anybody interested in value investing micro caps. Please come to these events. Uh there are incredibly fun ways to meet new people, learn about new ideas. >> Absolutely. No, that's that's awesome. I Man, I didn't I wish I didn't live so far. I'm in LA, you know. I very It's a little It's a little far, but uh Well, >> one American. >> Oh, don't get Listen, I will say this. Don't get jealous. Just come. You know, we're going to be in Toronto. you know, it's a little closer, you know. >> Yeah. >> And we'll be in Vegas in mid June. So, we'll give you some time to, you know, organize. We'll be, you know, you'll >> you might Lizzy, >> is there Ryionaire to Las Vegas? >> I think so. >> I don't think so. But maybe at least to Iceland. You'll get to Iceland. You >> to Iceland and then Southwest or something. >> Yeah, exactly. But they're doing a signed seating now with Southwest. So, you know what? You'll you'll at least know exactly where you're sitting. It'll be fine. But, um, cool. Well, Iggy, with that, where can our audience go and find more information to follow you on Substack as well as all your social media? >> Yes. Um, Iggy on investing everywhere. So, you can go to Twitter, you find Iggy on Investing, not Iggy Asalia, not Iggy Pop, just Ignon investing. Um, there there will also be a link to my Substack, but my substinvesting.substack.com. There you can find all my writeups. uh so the dev value ids you can find announcement about the events and one other fun thing I do that some of your readers might like is I sometimes do case studies of uh public investors which I think are very fun to do one that's why I do them but I think quite useful so one I did is uh I took all public letters by smoke capital I just said okay what stock did he pitch what was the ID and what happened afterward and then I think it's a nice way to sort of learn about these grades in the micro cap space so if you're into that also Give those a read. I'm currently doing a whole series on Jeremy Raper. He started adding pictures after I started writing about him, so I don't know if I'm ever going to finish. >> Did you write him? Be like, "Dude, slow down a little bit, man. I'm trying to I'm trying to write a whole expose in a good way on you. Come on." >> Exactly. Exactly. But he started adding old pictures. He just took stuff that wasn't public like, "Okay, Iggy, write about this as well." >> Oh, he said, "Oh, cool. You're in contact with him because that's that's he's he's a great dude." >> Yeah, he's very nice. He's very nice. >> Very cool. All right. Well, Iggy, thanks again for joining me. This was awesome. Really do appreciate it and I look forward to having you on again at at some point in the future. >> For sure. Lots of fun. Thanks for having me. >> Thanks, Iggy. [Music]