Jeff Phillips: 2 Details That Make or Break a Mining Bet
Summary
Prospect Generators: Strong advocacy for the prospect generator model to reduce dilution, farm out drilling risk, and improve discovery odds, with a preference for hybrid approaches that selectively advance 100%-owned assets.
Kincora Copper (KCC): Pitched as a dual-listed prospect generator with ~42M shares, ~30% insider ownership, a one-year hold financing structure, and multiple JV projects (including with majors) targeting copper-gold porphyries in the Macquarie Arc.
Headwater Gold (HWG): Highlighted as a hybrid prospect generator in Nevada with partnerships (e.g., Newmont, OceanaGold) and a strategic shareholder (Centerra), advancing several projects while limiting dilution.
Patriot Battery Metals (PMET): Case study of a major lithium discovery from $0.16 to $16, subsequent pullback with lithium prices, and potential upside if lithium continues to recover.
Market Outlook: The guest believes we are in the early innings of a major resource bull market, expecting occasional healthy pullbacks before further highs, informed by prior cycles.
Alignment & Structure: Emphasis on tight floats, meaningful insider ownership, full reporting, and longer hold periods to align stakeholders and reduce warrant-driven churn.
Key Metals Focus: Focus within the Materials sector on Gold and Copper, with multiple copper-gold drill programs anticipated and majors funding JV work to minimize shareholder dilution.
Transcript
My most controversial view is I think they should go back for the year hold. I think all the exchanges that say look if you're going to get warrant coverage, you at least have to be able to hold the stock for a year. And a year is really not that long a period of time, especially when you're getting some sort of warrant coverage. Jeff Phillips, he's been financing and backing resource companies for more than 30 years. Sat on both sides of the table. Broker, funer, investor through every mining cycle. Know spotting serious teams early. walking away from bad paper even faster. Um you've chef you've been behind a bunch of uh a bunch of names that have have gone on to have great shareholder success. Alex Riverside Headwater those are those are the uh the North American names and and uh down under I'm sure we'll explore some of the ones you've been involved in too. But in short, you're a bit of a seasoned sector insider who invests your own money. You tell it straight and you understand how value actually gets created in the challenging small cap junior mining end of the business. Jeff, thanks for joining us on Money and Mind. >> Thank you for having me, guys. >> Really appreciate it. I am uh thrilled to to kind of peel into your your brain, Jeff, on on some of the things that are uh just part of your your investing DNA or or or part of your screening process, and they can't be erased. And I'm talking about things like um like alignment, management alignment, capital structure. Like what do these things like mean to you? Because, you know, I I know that without them, it doesn't matter how good the rocks are, it's it's just a no. >> Yeah. Basically, I look for two things. Share structure and people. Um, when I say share structure, you said capital align, and that's a good way of putting it. I like to see that management has what some people call skin in the game. I like to make sure that they don't only have skin in the game, but they're fully reporting. You guys are different in Australia because you can see all the shareholders, but in the Canadian markets, you know, unless you're fully reporting, you can do what you want with your shares. So, I like to see management that's got a sizable position that's fully reporting. That means they're reporting to Cedar in the Canadian markets or the equivalent in the US markets, their position, and you're going to know if they decide to sell stock or or, you know, and so forth. So, the other thing I like to see with shareholder alignment, I think that's a great term, is I like to know who the other shareholders are. you know, a lot of these, it's the same in Australia, although I'm more focused on the North American markets, but obviously there's crossover. Um, I like to see that the other shareholders are like-minded to me that they're they're in the it, you know, investing in a company for a period of years, not months. So, you know, the uh development and exploration business is very difficult. So, here in the Canadian markets, you know, it used to be back when I first came in the business in the 90s and and uh had quite a bit of success. Um, when you did a private placement, you had to hold the stock for a year. That's why you got some warrant coverage. When I retired after selling an oil and gas company off of the NASDAQ, I came back in the business in 2004, 2003. Started financing companies in 2007. I was astounded to learn that the hold period was down to four months. I don't know what you guys do in Australia, but but even now, you know, there's these life financings in Canada, which are no hold and they still get warrants. So, you you get a lot of warrant collectors. I want to make sure that management is is, you know, I like to use a boat analogy. I'm getting on a lake to get to the other side in a boat and I want to make sure management's going to row all the way to the other side and they're not jumping out when I don't know it. And I want to make sure the other shareholders are also pulling the ores. You know, I want to know everybody's in that boat trying to get to the other side. So, that's that's share structure. And obviously having good people who have a track record of uh of growing companies, growing market caps or or the ultimate thing, selling an asset to another company is is what I'm looking for. >> You you'll be disappointed to hear that people can flog their stock within about a day of getting it here in in Australia once the racing's done. >> But we don't have we don't have we don't have the Yeah. like the prevalence of like attaching warrants and warrant collectors that >> nowhere near as as strong as it sounds in in North America and Canada in the resource market. Yeah. >> Well, look, there there may be s there's slight differences obviously, but at the end of the day, the resource market is is not really investing. It's educated speculating. Um and and again, you know, whenever you have things that can go up and become billion-dollar assets in any type of market, you get the people that uh aren't necessarily the long-term shareholders or people trying to do what's best for the group. So, Jeeoff, I'm really curious, like what Trev said, to peel into your um investing framework and and in particular your your psychology because having done a bit of digging, the the way you sort of frame it is is is simple, but simple in investing is often the hardest thing to do. Being patient and hanging in the name for for two to three years at a time, but you don't seem to uh you don't seem to have a an awful lot of trouble sort of doing that. you you you seem pretty sort of down down to earth about all of it. Do you do you still feel you have that internal struggle, you know, holding on to things, being patient, checking the boxes, or do you think over time you've just become quite at ease with it all? >> I think you become more at ease with it over time and you learn from past mistakes. Um, you know, I've been doing this for a long time. Um, and it just depends on what you're trying to do. People have different goals. if my goal was to make the most money possible, um there's ways to do that that I could make a lot more money. Part of my joy and still, again, I'm essentially retired working full-time right now, but because it's because I enjoy it. I mean, I I I I enjoy working with management teams. I enjoy the the hunt. Um I enjoy, you know, as long as we're looking for something meaningful. Uh you know, I enjoy that. And more so than making money on a great deal, it's being part of a team that makes money and and and having that connection. And some of the people we talked about earlier, like Michael Hudson, you know, we've been friends now for 15 years and we've had some great wins together. And I'm sure we'll have some more in the future. He's a great Australian geologist, but at the end of the day, the friendship and the camaraderie and the and the past experiences are what really make it fun. So this is yeah this is um an interesting feature of like the part of the market that you focus on. I think Canadians like it's even more prevalent than maybe Australia, but we we we all like both both mining centers have um yeah these like kind of individual high net worth financers who have like a they might have like a mining house or or or a bunch of kind of relationships with geologists and it's the the I kind of like tying the geologist with the individual with their own connections that can that can maybe you know seed some some new project in a in a in a public vehicle. with with some kind of story and it's like wrapped around it. Um I'm I'm kind of just like curious how all of that comes together. Like how do you how do you actually like ident like a identify a project worthy of um worthy of of investing in in the first place? B kind of um uh cultivate a network of of financiers alongside you who you know are like motivated to be there for the same duration and c understand the opportunity. >> Well over time you build that network up. Um, you know, again, and and sometimes people fall out of your network because they're not exactly what you you thought they'd be. I I don't, again, I'm not Canadian. I'm I'm based here in San Diego, California. Uh, not a mining mecca of the world, although obviously Rick Roll's operation was based here for a long time. And uh but but but again you build up that network of people and you build up teams and there's all kinds of you know I liken this to I think I've used the analogy I don't know if you guys have uh fantasy fantasy sports there but all my friends here play fantasy football and they're they're on teams and they pick their teams and they're every weekend they spend all weekend talking about their teams. I play football and I enjoy the sport but I don't play fantasy football because all week long I have fantasy resource stocks in the market. I have friends and teammates and or you know again it's like you said it's a shareholder you know capital alignment and you know but again there's lots of good groups you know even here in North America, America and Canada that you know do great jobs and I respect them but I don't necessarily work with them um because I have my own network. I if if I like think more deeply about the the point on on alignment just just once more like if you if you like if you see a CEO that has like a I don't know like a three $300,000 per year salary or $350,000 per year salary and they own like less than 1% of the stock and it's like a you know5 to10 million market cap. What does that tell you? Oh, it tells me I probably don't want to look at the company anymore. I look at, you know, like deals a day. You know, there are some cases where it's a young guy that's been brought in and he doesn't have a lot of money and, you know, so he doesn't have a lot. But again, you know, but again, if you tell me that same company, the CEO owns 2%, he's a younger guy, but they have, you know, two other directors that each own 15% fully reporting. And then you tell me that, you know, they've got several funds that own Fully Reporting and it's 50% of the stock is owned by um is owned by fully reporting shareholders. I know those people are trying to build something um because they're not being able to flip their stock and you know, we're into a market now which it makes it even harder. You know, we're in a bull market. Um, so, so again, you know, the hardest thing is if you've been in the business a long time, uh, is you see the stocks go up and you have to remind yourself what a bull market looks like because again, otherwise it's kind of like, well, gee, are these things really worth four times what they were 12 months ago. But the fact is in a bull market, and the last one I saw was the 2008 to 2011 bull market, which really was just a continuation of the 2003 to 2007 with the real estate bubble in between. you know, it's pretty amazing in a bull market. So, I think this is going to be a really big bull market. And I think, you know, a lot of the people that are short-term players that are going to be real happy they're finally getting bailed out are going to get out early, and I think they're going to find this thing has a long way to go. H >> how to to sort of further Tra's question there, how do you think about options, performance rights, and these things? Do you kind of comb through them quite carefully and make sure everything is sort of on side with how you think about alignment? Yeah. Well, most of the options to management are fully reporting, so I can see what that is. And you have the problem that, you know, when those are expiring, sometimes they have to exercise those and sell some for tax purposes. So, I do keep an eye on that all the time and talk to those companies. I typically have half a dozen companies. I'm a large shareholder in I have I own more companies, but I mean very large shareholdings and I also consult for those companies. So, yeah, I'm monitoring all that. But again, most of my companies uh have anywhere from 30 to 50% fully reporting insider ownership. Their main goal is to make those shares worth money, and they're not able to sell those shares unless they transact, which means they sell the business or they get into a wild bull market. Again, if I own a stock that's a 50 cent stock, and this has happened many times over 30 years, and we get into a bull market and it goes to $15, it may not get sold that, you know, again, it's got something real, but I'm going to take some profit off the table, and anybody should in that situation. I'm I'm probably taking it off the table at four and five and eight and $10, but uh but again, I think we're in that situation where it gets very hard if you're been in the business a long time and you've evaluated lots of companies. I think this the bull markets always skew. Um, you know, you tend to be too smart for your own good. I had a famous one of my mentors, I've had a number of them, was a Jim Dyn. He wrote the Dyn letter for 63 years here in the United States. Very famous gold bug, internet bug, first marijuana bug. He had lots of things he claimed that he was the first in and he was. But one of his things was, you know, uh, look, don't think. and he was referring to charts that you know again if something's in a bullish trend just because you think it's gone up a lot you know don't think too much in a bull market you know so I think we're heading into a market where you know I have to remember to look and not think because if I think too much I'm going to go gee I remember the last 15 years and uh and it wasn't this market so >> brains can be the enemy of gains in a bull market but the >> absolutely that's a great way of putting it >> yeah it's funny because some of the things that do they end up, you know, going all the way back down again. And I I'm I'm certain you you've written a few of those in your um in your tenure, Jeff. >> Absolutely. Yeah. I I I always joke I sell I sell some of it too early. I sell some of it perfectly and I hold some just because I think it might go higher and I still own it lower. So, you know, again, you never, you know, I mean, the best deal is the deal that sells at a record, which is very seldom, but you know, and I've had those where a deal sold to another company and it sold at the highest price the shure has ever traded at, and it doesn't get any better than that. I just had a deal that I financed, I was in the financing called Horizon Copper, and it was bought out by uh Royal uh Royal Gold, the royalty company, and an allcash offer. That's kind of a no-brainer. It was bought out at the highest price it ever traded at and that was great. >> So you seem to really analyze the the people the people behind businesses the people aspect of bull markets. How does the uh exuberance where we're feeling right now which has sort of flushed on quite quickly compared to 2007 call it 2011 96ish before Brix these sorts of things. Um, you know, I was I was probably your guys's age and and during brax I'd came in the market. I actually indirectly worked for Rick Roll and we were pretty successful and uh but had less capital. So that was a crazy market from I mean I started investing in the resource stocks right out of college. So that must have been 92 or three or something like that. I mean it was a really crazy market. It's hard for me to remember you know I give you an example that I can remember. You know, in a bull market, I had a company in the rare earth boom, the first boom back in 2008, and before people knew what rare earths were, they weren't even talked about. I'd financed a company at 75 cents. Then the real estate crisis hit, and there were no biders for stocks in the resource sector. And I was calling another high net worth individual and we were playing every other day who was going to buy the stock at 26 cents. the bull market took off and Rorus got, you know, going and and all the commodities were doing good in 09 and 10 and uh we ended up financing the company after we couldn't find buyers and bought millions of shares. We did another financing at a dollar. A month later we financed it at $150 and a month after that we financed it at $3. We never sold any of that stock. It was a bull market. The stock eventually went to $189 a share. You know, it was trading its entire float two years later um every day. So again, from not from that's a bull market from three years where nobody wants to buy the stock to three years later it's on CNBC here in the States and they're talking about this little company that you couldn't get anyone to buy three years before. So we're in early innings of a bull market. That doesn't mean there won't be some hiccups. You know, I think there's going to be, you know, again, we'll we'll get some of the the the people that are short-term players selling out stocks and uh, you know, it'll be healthy for gold to have a sell off and build a new base and then go to new highs. So, you know, but I think we're in early innings of a a major bull market. >> The um it it sounds like you're pretty pretty attuned to just the impact that low float or or a tight float can have just in in share price dynamics. think in, you know, in this bull market, even even my observations on some of the some of the stocks that are are most volatile to the upside, there there's absolutely kind of a a lowflat dynamic to what's going on. Combine that with with a bit of retail energy, and it doesn't take much to have just yeah, very outsized moves. >> That comes back to share structure again, too. And and and that's why it's important because you want to have a lower float. You want to have people that are committed longer term because when you go to raise money again remember most of these companies whether in Australia or Canada aren't making any money they they're spending money exploring or developing a project. So I want to make sure that when they raise money in the future that the capital costs are higher which is good for me as a shareholder uh less dilution and and a lot has to go you know we can use an example of an Australian company later if you want that again I I requested a year hold on the stock even though it was only a well you can do a no hold but not even a fourmonth I said you know everybody's holding their stock it's locked up for a year um it gives the company more room to run it gives the company the ability to build out their assets and raise capital at higher prices. So that's why we did that. >> And what might that stock be? >> Uh Concora Copper. It's actually dual listed. It's in the uh uh it's on your exchange there in Australia and it's in on the TS TSXV in Canada. It's a prospect generator, which you guys don't have a lot of in Australia. In the United States, we have, you know, more of those. It's a type of model and and it's a model that Rick Rule really pioneered 30 years ago. Um, and it increases your odds of uh success in making a discovery um with less delilution. >> The delilution is the the enemy of a of a of a junior trying to make a discovery and it's um it's unavoidable when you've got yeah like a a small market cap and a very capital intensive um you know binary kind of outcome on on on continuing exploration fund. So the prospect generator model you try and farm it out to other parties to spend the expiration and and you maintain a very very low kind of spend at the headco itself. >> Um >> correct >> how like why why is this like this this like a like more prevalent in in North America than it is in Australia from from your perspective? And um >> yeah, I can't answer that question why you do that except that maybe Australians like the the thrill of the chase even more. I mean, you still get that with a prospect generator, but the difference is instead of raising money to drill your property, which you know, again, doesn't always go the way you want it to and can take time. You're like, like you said, you're joint venturing your property out properties out to other people. And again, it's all about the people running the company. Just because you're a prospect generator model doesn't mean you're executing it properly. Using Concord as an example again, you know, two of their projects or yeah, two of their projects are joint ventured out to Anglo, a major mining company that's, you know, spending a lot of money on these that, you know, would be a lot of dilution, but at the end of the day, they're giving up a big piece of the property if there's a discovery to that joint venture partner. But being that Concor is looking for buried copper gold puries um which can take time, it's great to have someone like Angla with deep pockets who has a potential spend to earn into those projects of you know $90 million or something like that and they have several other projects joint ventured out with other companies. So next year they're going to see you know three, four, five properties drilled um that aren't going to dilute me as a shareholder. And what's great about Concora is that it's also very unique for an Australian listed company. It's only got about 42 million shares outstanding. Um we cleaned up the structure. You know, 30% of that's owned by reporting insiders, people on the board or management. And then like I said, Rick and I and a number of other North American investors um that that have experience in this space, you know, provided a $4 million of capital to them to uh and we put a year hold on our stock. So, you have a float that's, you know, very tight. You have management and board that's aligned with a long-term goal and you have a lot of drilling getting done next year that, you know, again, there's no guarantee you're going to find something. But again, in Concor's case, their technical team is bar none. I mean, you're talking about guys discovered Katy as you're talking about guys that were high up at New Crest before they were brought by Pneumont. They know your backyard. They're Australian and they know the Mcquaryy Arc. So again, it's a great speculation, but I'm not making stock recommendations. I don't have a newsletter. I don't sell anything. I'm a professional investor and you know, I tell everybody in interviews that, you know, and I don't know how this pertains to your Australian markets, but I see it here in the North American markets that, you know, I try to have a position of, you know, roughly 12 stocks that I have a large position in. And again, I have other ones because I know people and I do do financings. But 12 companies that are my my core holdings and make up a bulk of my money that's in that space. If you have too few companies, you know, again, you run the risk of there's still mother nature. There's luck. There's the overall markets. You know, you're not always in a bull market. So, you want to have enough companies that you have multiple shots to win. And on the other hand, I see so many investors here that I meet at conferences that ask me to look at their portfolio and there's 90 stocks in their portfolio that they printed out from their brokerage firm. Well, if you have a stock go from 15 cents to $20, that's great. But if you have 90 of those things, it's not going to affect your portfolio unless you know, again, so but a bull market does change that. But I like to follow a model where you don't have too many stocks. So, and and you lower your risk. So, I don't know if this is helping you, but >> how how do you spread your bets amongst those sort of 12 core names across commodities? >> Well, again, you know, if you're a a retail investor, not a professional, you want to get good advice from a broker or a a third party newsletter writer, a show like yourselves, you want to, you know, we've got the internet now. My daughter likes to tell me when I try to remember things and forget to look it up on the internet. But, uh, you can research a lot of this stuff. Do your research. And as far as, you know, everybody, you know, again, your your natural resource polio should be a slice of your pie. It's not your whole pie. And it's only, it really is for people that know what they're doing. That's why, again, I'm saying you shouldn't listen to me per se. Um, you should do your own research. But I personally like to have a basket of companies and different commodities. Um, I like to, you know, I say 25% and I probably have because I'm a professional, I probably have 16 companies right now. And plus, I think we're into a bull market. But 25% of those are prospect generators, um, which are again are farming out their projects. And just because something's a prospect generator doesn't make it a good deal. It's how you farm out your projects, who are your partners, what is the spend on those projects. So there's, you know, out of probably 50 60 prospect generators I know, there's six or seven of them that I think are making meaningful deals that that increase my odds because there's more money being spent on those projects. I also then I then I have the drill hole play. I still like to be terrified and go out and and drill something and and you know and usually it's a brownfield type project I'm looking for again with a good share structure and good management that has a past track record of success. So you know again right now I have three or four companies that are looking for copper gold. I've got a uranium company. I've got a rare earth company. I've got you know four pro four or five prospect generators. Probably four. One of them is not really a prospect generator anymore but that that's my portfolio. But just because it's my portfolio doesn't mean it's the right portfolio for someone else. >> Sometimes when the prospect generator when things go right, they pivot and they become not a prospect generator anymore. And um yeah, the it's like, you know, it's about the the discovery that was had. But when does a prospect >> and I actually >> I'm sorry. I didn't mean to catch up. >> Oh, that's okay. Yeah, I I'll let you finish, but I was just going to add when does a prospect generator go wrong? To the contrary. Well, I I t I typically like what I call the hybrid prospect generator model, which is a company that's got a number of projects generated out that's got companies spending, but they do spend some of their own money uh exploring their, you know, improving some of their 100% owned properties. And if they are lucky enough to make discovery, then they focus on that property. But again, I like a balance. I I kind of like the hybrid. And Concor is kind of like that. Even though they've got most of their projects available for joint venture, they have their gold project which they're keeping 100% and they're going to advance that a little bit further down the food chain, do some of their own drilling. Um, you know, and normally a prospect generator does the early work and, you know, brings a company in to do the drilling. So, in that case, Concor is, you know, I I have several companies, Concor Headwater Gold, that's a prospect generator here in Nevada and again, they're joint ventured out headwater with Pneumont. Uh they've got uh Oceanana Gold on other projects. They've got Centara is a 9% shareholder, their producer, but they have several projects that they're going to advance a little bit further. So Concor and Headwater are two companies that are hybrid prospect generators. Get the both best of both worlds. The um the to kind of like, you know, peel it peel it back a little bit. Um when when you see when you see like the market retail enter more liquidity a lot more volume in the lower end of town what are your like what do your instincts tell you to kind of lean in or to lean lean out? >> Well right now I I think the time is to finance companies with good people and good share structure. I think this thing's got a lot further to run. Although I think there'll be some pretty good hiccups along the way where people get scared out. Again there's a whole different mentality of investing in junior resource stocks. If you're investing $5,000 to make $10,000 and that's your goal, you again you can do that and you don't have to follow necessarily sheer structure. It's when you have bigger positions that you're not going to be able to trade and stuff. So in this market I think you know it's a speculative market. I think things are going to keep going higher. Um you know some of the stuff I would never want to own 9% of the company like I do in some of my companies. uh you know doesn't mean they're not going to go up fivefold and someone buying $10,000 worth. It just depends on what your goal is. And I guess you have to figure that out for yourself. >> Will you often or you know almost always encourage a a tra a transaction a corporate outcome? Is that the easiest way for for you to get out or do you sort of see plenty of the time you manage to sell down as the company just grows into itself? >> Well, in a bull market you manage to sell down or you know there's been bull market. I mean I say there hasn't been a bull market for 15 years but obviously uh there was a lithium bull market. There's been different bull markets in that time in commodities. The lithium stocks did really really well from you know I don't know up until two years ago. So four years ago I guess four and a half years ago uh you know the lithium stocks boomed and like we talked about I financed a company called Patriate Battery Metals at 16 cents. Uh later some Australian guys that you knew came in and financed it at 40 cents and and I was also involved in that financing, but that stock eventually went to $16 on a major discovery um with a management team that's built a lithium company before. Um and I took profits along the way because again at 16 cents, you know, I think I sold stock at $2 on the way up, but you know, again, but I was still selling stock at, you know, 12 and 14. So um yeah, it wasn't a transaction. It's still it's a tremendous asset. lithium prices came back 90%. So, the stock came all the way back to 250. Now, it's starting to move back up with the lithium prices. And if lithium continues to improve, it'll probably be a $16 stock again. But, but again, yeah, it's not always a transaction. And but I like to see a transaction because the other thing I don't like is when guys that are good developers or good exploration geologists try to put something into production and become mine guys, the transition obviously doesn't always work. So >> you you really play by these these kind of rules. Jeff, I'm I'm curious to hear if you if you look back in your career, when did you sort of land on this kind of model coming out the 90s into that bull run into to the 2000s? Have you been, you know, playing by the same sort of script since then or how did it all come about? >> Well, I think it comes about over learning over time. I've always tried to, you know,body can say this, but I, you guys don't know me, but here in the North American market, especially in Canada, I have a, you know, pretty good reputation of following through on what I say I'm going to do, being a good team player, and and again, that's what's important to me. It's not who makes the most money in the business. It's having a good reputation. Um, and also making money along the way. Obviously, that's part of the fun, but so I I've learned from experience. You know, when I first came in the market, I was 26 years old and it was a bull market. It was 1994 or something like that. And I thought I found, you know, I didn't know why I went to college. I thought, hey, I don't need to go to college. Everything I buy doubles in three weeks. I thought I found a broken slot machine. I didn't realize I was in a bull market. So I, you know, I learned and I got lucky that, you know, my partner and I ended up starting an oil gas company with a I don't know, a $20 million market cap when we took it public and we sold at 99 for 480 million. There was a lot of luck involved in that, too. So I but again I thought it was a broken slot machine. I didn't know that the resource market didn't always act that way. So >> what what was the sort of play there? Was it just sort of picking up a bunch of land and then the the cycle kind of changed or how did it sort of play out in your favor? >> The play in my oil and gas company or the play in the re the reverse market? >> The oil and gas play. Well, well, that was funny that, you know, we we were working with a company that was actually one of the most successful companies listed and and o over time I think the stock went from originally 75 cents to $10 back to 75 cents because of all the, you know, I learned that that a lot of the people that are big shareholders even the assets were incredible, they sold their stock and and tried to joint venture assets out to their own benefit to their other companies. But eventually that company went back from 10 to 75 cents and then new management came in because the assets were ungradable and went to $200 a share and because of that company over a 10-year period. Um because of that company we got wind of another oil and gas play in Wyoming and we were young. I mean we were 28 29 years old and we ended up staking as much ground on that hiring landman and you know it's bad episode of a cable show. We staked everything because we realized these two NASDAQ companies were and we leveraged ourselves to the tilt. You know, we had so much land we didn't, you know, you know, and luckily we brought management in that. I mean, the board was a bunch of friends and that, you know, again, we learned through experience, but we brought management in who actually run a a NASDAQ public company and retired, but he'd looked at what we had and said, "This is pretty incredible." And it was really those guys that two and a half years later were able to sell the company through development for for you know $18 a share or something. So again it wasn't total skill. It was a learning experience at 29 years old. And at that time I thought wow I'm going to retire. We were the largest shareholders of the company. But again uh you get bit by the bug and here I am 30 years later still doing this. >> That's awesome. >> Jeff, last question for you. What's your your your most um your most controversial view in the resource speculating sector? >> My most controversial view? I have a lot of controversial views. You want me to rank my most controversial? Um >> you can just give me one. >> I don't know that people's names would be involved in that. I don't know. you know, um, you know, my most controversial view is if you're really trying to develop an a a junior resource company that, you know, and you really are, that's, you know, if you're not just playing the and really this this hasn't changed since the gold rush. And I don't know your Australian history, but the gold rush here in California that built San Francisco. I mean, you know, Mark Twain has the famous quote, you know, gold mine's a hole in the ground with a liar standing over it. What a lot of people don't tell you is Mark Twain actually sold mining claims before he came up with that quote and and ended up writing for the newspaper. But uh yeah, I mean the bottom line it's the wild west this stuff. So you if I my most controversial view is I think they should go back to the year hold. I think all the exchanges would say look if you're going to get warrant coverage you at least have to be able to hold the stock for a year. um it would take the entire Mickey Mouse speculation out of it and you'd actually have people having to make smart decisions and a year is really not that long period of time especially when you're getting some sort of warrant coverage. So that would be very controversial because most people in the Canadian markets and the Australian markets don't want to be locked up. So >> I love it. That's a that's one I think we are very well aligned on. Jeff, really appreciate you coming on the show sharing how you think about the markets, how you think about investing in the junior space and yeah, thank you for for sharing that with our audience. >> Well, I hope this was somewhat helpful. And again, just to reiterate, I'm not giving investment advice. Any companies I mentioned are companies that I'm a large shareholder in and I probably consult for. You should do your own due diligence. look at stuff and and really soak as much information as you can from shows like yourselves and realize that you know you're you're investing is investing in in in earnings and dividends. This is educated speculation. So make sure you educate yourself. >> Beautiful. >> Thanks so much Jeff. Love the way he thinks about markets about the world almost as much as I love our partners mate. A big thank you to focus the platform by market techch Sanvic ground support IMAK the conference is coming up very soon next week actually we're going to be in Sydney so check that one out and last but not least in llinks huru who to root now remember I'm an idiot JD is an idiot if you thought any of this was anything other than entertainment you're an idiot and you need to read out a disclaimer
Jeff Phillips: 2 Details That Make or Break a Mining Bet
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Transcript
My most controversial view is I think they should go back for the year hold. I think all the exchanges that say look if you're going to get warrant coverage, you at least have to be able to hold the stock for a year. And a year is really not that long a period of time, especially when you're getting some sort of warrant coverage. Jeff Phillips, he's been financing and backing resource companies for more than 30 years. Sat on both sides of the table. Broker, funer, investor through every mining cycle. Know spotting serious teams early. walking away from bad paper even faster. Um you've chef you've been behind a bunch of uh a bunch of names that have have gone on to have great shareholder success. Alex Riverside Headwater those are those are the uh the North American names and and uh down under I'm sure we'll explore some of the ones you've been involved in too. But in short, you're a bit of a seasoned sector insider who invests your own money. You tell it straight and you understand how value actually gets created in the challenging small cap junior mining end of the business. Jeff, thanks for joining us on Money and Mind. >> Thank you for having me, guys. >> Really appreciate it. I am uh thrilled to to kind of peel into your your brain, Jeff, on on some of the things that are uh just part of your your investing DNA or or or part of your screening process, and they can't be erased. And I'm talking about things like um like alignment, management alignment, capital structure. Like what do these things like mean to you? Because, you know, I I know that without them, it doesn't matter how good the rocks are, it's it's just a no. >> Yeah. Basically, I look for two things. Share structure and people. Um, when I say share structure, you said capital align, and that's a good way of putting it. I like to see that management has what some people call skin in the game. I like to make sure that they don't only have skin in the game, but they're fully reporting. You guys are different in Australia because you can see all the shareholders, but in the Canadian markets, you know, unless you're fully reporting, you can do what you want with your shares. So, I like to see management that's got a sizable position that's fully reporting. That means they're reporting to Cedar in the Canadian markets or the equivalent in the US markets, their position, and you're going to know if they decide to sell stock or or, you know, and so forth. So, the other thing I like to see with shareholder alignment, I think that's a great term, is I like to know who the other shareholders are. you know, a lot of these, it's the same in Australia, although I'm more focused on the North American markets, but obviously there's crossover. Um, I like to see that the other shareholders are like-minded to me that they're they're in the it, you know, investing in a company for a period of years, not months. So, you know, the uh development and exploration business is very difficult. So, here in the Canadian markets, you know, it used to be back when I first came in the business in the 90s and and uh had quite a bit of success. Um, when you did a private placement, you had to hold the stock for a year. That's why you got some warrant coverage. When I retired after selling an oil and gas company off of the NASDAQ, I came back in the business in 2004, 2003. Started financing companies in 2007. I was astounded to learn that the hold period was down to four months. I don't know what you guys do in Australia, but but even now, you know, there's these life financings in Canada, which are no hold and they still get warrants. So, you you get a lot of warrant collectors. I want to make sure that management is is, you know, I like to use a boat analogy. I'm getting on a lake to get to the other side in a boat and I want to make sure management's going to row all the way to the other side and they're not jumping out when I don't know it. And I want to make sure the other shareholders are also pulling the ores. You know, I want to know everybody's in that boat trying to get to the other side. So, that's that's share structure. And obviously having good people who have a track record of uh of growing companies, growing market caps or or the ultimate thing, selling an asset to another company is is what I'm looking for. >> You you'll be disappointed to hear that people can flog their stock within about a day of getting it here in in Australia once the racing's done. >> But we don't have we don't have we don't have the Yeah. like the prevalence of like attaching warrants and warrant collectors that >> nowhere near as as strong as it sounds in in North America and Canada in the resource market. Yeah. >> Well, look, there there may be s there's slight differences obviously, but at the end of the day, the resource market is is not really investing. It's educated speculating. Um and and again, you know, whenever you have things that can go up and become billion-dollar assets in any type of market, you get the people that uh aren't necessarily the long-term shareholders or people trying to do what's best for the group. So, Jeeoff, I'm really curious, like what Trev said, to peel into your um investing framework and and in particular your your psychology because having done a bit of digging, the the way you sort of frame it is is is simple, but simple in investing is often the hardest thing to do. Being patient and hanging in the name for for two to three years at a time, but you don't seem to uh you don't seem to have a an awful lot of trouble sort of doing that. you you you seem pretty sort of down down to earth about all of it. Do you do you still feel you have that internal struggle, you know, holding on to things, being patient, checking the boxes, or do you think over time you've just become quite at ease with it all? >> I think you become more at ease with it over time and you learn from past mistakes. Um, you know, I've been doing this for a long time. Um, and it just depends on what you're trying to do. People have different goals. if my goal was to make the most money possible, um there's ways to do that that I could make a lot more money. Part of my joy and still, again, I'm essentially retired working full-time right now, but because it's because I enjoy it. I mean, I I I I enjoy working with management teams. I enjoy the the hunt. Um I enjoy, you know, as long as we're looking for something meaningful. Uh you know, I enjoy that. And more so than making money on a great deal, it's being part of a team that makes money and and and having that connection. And some of the people we talked about earlier, like Michael Hudson, you know, we've been friends now for 15 years and we've had some great wins together. And I'm sure we'll have some more in the future. He's a great Australian geologist, but at the end of the day, the friendship and the camaraderie and the and the past experiences are what really make it fun. So this is yeah this is um an interesting feature of like the part of the market that you focus on. I think Canadians like it's even more prevalent than maybe Australia, but we we we all like both both mining centers have um yeah these like kind of individual high net worth financers who have like a they might have like a mining house or or or a bunch of kind of relationships with geologists and it's the the I kind of like tying the geologist with the individual with their own connections that can that can maybe you know seed some some new project in a in a in a public vehicle. with with some kind of story and it's like wrapped around it. Um I'm I'm kind of just like curious how all of that comes together. Like how do you how do you actually like ident like a identify a project worthy of um worthy of of investing in in the first place? B kind of um uh cultivate a network of of financiers alongside you who you know are like motivated to be there for the same duration and c understand the opportunity. >> Well over time you build that network up. Um, you know, again, and and sometimes people fall out of your network because they're not exactly what you you thought they'd be. I I don't, again, I'm not Canadian. I'm I'm based here in San Diego, California. Uh, not a mining mecca of the world, although obviously Rick Roll's operation was based here for a long time. And uh but but but again you build up that network of people and you build up teams and there's all kinds of you know I liken this to I think I've used the analogy I don't know if you guys have uh fantasy fantasy sports there but all my friends here play fantasy football and they're they're on teams and they pick their teams and they're every weekend they spend all weekend talking about their teams. I play football and I enjoy the sport but I don't play fantasy football because all week long I have fantasy resource stocks in the market. I have friends and teammates and or you know again it's like you said it's a shareholder you know capital alignment and you know but again there's lots of good groups you know even here in North America, America and Canada that you know do great jobs and I respect them but I don't necessarily work with them um because I have my own network. I if if I like think more deeply about the the point on on alignment just just once more like if you if you like if you see a CEO that has like a I don't know like a three $300,000 per year salary or $350,000 per year salary and they own like less than 1% of the stock and it's like a you know5 to10 million market cap. What does that tell you? Oh, it tells me I probably don't want to look at the company anymore. I look at, you know, like deals a day. You know, there are some cases where it's a young guy that's been brought in and he doesn't have a lot of money and, you know, so he doesn't have a lot. But again, you know, but again, if you tell me that same company, the CEO owns 2%, he's a younger guy, but they have, you know, two other directors that each own 15% fully reporting. And then you tell me that, you know, they've got several funds that own Fully Reporting and it's 50% of the stock is owned by um is owned by fully reporting shareholders. I know those people are trying to build something um because they're not being able to flip their stock and you know, we're into a market now which it makes it even harder. You know, we're in a bull market. Um, so, so again, you know, the hardest thing is if you've been in the business a long time, uh, is you see the stocks go up and you have to remind yourself what a bull market looks like because again, otherwise it's kind of like, well, gee, are these things really worth four times what they were 12 months ago. But the fact is in a bull market, and the last one I saw was the 2008 to 2011 bull market, which really was just a continuation of the 2003 to 2007 with the real estate bubble in between. you know, it's pretty amazing in a bull market. So, I think this is going to be a really big bull market. And I think, you know, a lot of the people that are short-term players that are going to be real happy they're finally getting bailed out are going to get out early, and I think they're going to find this thing has a long way to go. H >> how to to sort of further Tra's question there, how do you think about options, performance rights, and these things? Do you kind of comb through them quite carefully and make sure everything is sort of on side with how you think about alignment? Yeah. Well, most of the options to management are fully reporting, so I can see what that is. And you have the problem that, you know, when those are expiring, sometimes they have to exercise those and sell some for tax purposes. So, I do keep an eye on that all the time and talk to those companies. I typically have half a dozen companies. I'm a large shareholder in I have I own more companies, but I mean very large shareholdings and I also consult for those companies. So, yeah, I'm monitoring all that. But again, most of my companies uh have anywhere from 30 to 50% fully reporting insider ownership. Their main goal is to make those shares worth money, and they're not able to sell those shares unless they transact, which means they sell the business or they get into a wild bull market. Again, if I own a stock that's a 50 cent stock, and this has happened many times over 30 years, and we get into a bull market and it goes to $15, it may not get sold that, you know, again, it's got something real, but I'm going to take some profit off the table, and anybody should in that situation. I'm I'm probably taking it off the table at four and five and eight and $10, but uh but again, I think we're in that situation where it gets very hard if you're been in the business a long time and you've evaluated lots of companies. I think this the bull markets always skew. Um, you know, you tend to be too smart for your own good. I had a famous one of my mentors, I've had a number of them, was a Jim Dyn. He wrote the Dyn letter for 63 years here in the United States. Very famous gold bug, internet bug, first marijuana bug. He had lots of things he claimed that he was the first in and he was. But one of his things was, you know, uh, look, don't think. and he was referring to charts that you know again if something's in a bullish trend just because you think it's gone up a lot you know don't think too much in a bull market you know so I think we're heading into a market where you know I have to remember to look and not think because if I think too much I'm going to go gee I remember the last 15 years and uh and it wasn't this market so >> brains can be the enemy of gains in a bull market but the >> absolutely that's a great way of putting it >> yeah it's funny because some of the things that do they end up, you know, going all the way back down again. And I I'm I'm certain you you've written a few of those in your um in your tenure, Jeff. >> Absolutely. Yeah. I I I always joke I sell I sell some of it too early. I sell some of it perfectly and I hold some just because I think it might go higher and I still own it lower. So, you know, again, you never, you know, I mean, the best deal is the deal that sells at a record, which is very seldom, but you know, and I've had those where a deal sold to another company and it sold at the highest price the shure has ever traded at, and it doesn't get any better than that. I just had a deal that I financed, I was in the financing called Horizon Copper, and it was bought out by uh Royal uh Royal Gold, the royalty company, and an allcash offer. That's kind of a no-brainer. It was bought out at the highest price it ever traded at and that was great. >> So you seem to really analyze the the people the people behind businesses the people aspect of bull markets. How does the uh exuberance where we're feeling right now which has sort of flushed on quite quickly compared to 2007 call it 2011 96ish before Brix these sorts of things. Um, you know, I was I was probably your guys's age and and during brax I'd came in the market. I actually indirectly worked for Rick Roll and we were pretty successful and uh but had less capital. So that was a crazy market from I mean I started investing in the resource stocks right out of college. So that must have been 92 or three or something like that. I mean it was a really crazy market. It's hard for me to remember you know I give you an example that I can remember. You know, in a bull market, I had a company in the rare earth boom, the first boom back in 2008, and before people knew what rare earths were, they weren't even talked about. I'd financed a company at 75 cents. Then the real estate crisis hit, and there were no biders for stocks in the resource sector. And I was calling another high net worth individual and we were playing every other day who was going to buy the stock at 26 cents. the bull market took off and Rorus got, you know, going and and all the commodities were doing good in 09 and 10 and uh we ended up financing the company after we couldn't find buyers and bought millions of shares. We did another financing at a dollar. A month later we financed it at $150 and a month after that we financed it at $3. We never sold any of that stock. It was a bull market. The stock eventually went to $189 a share. You know, it was trading its entire float two years later um every day. So again, from not from that's a bull market from three years where nobody wants to buy the stock to three years later it's on CNBC here in the States and they're talking about this little company that you couldn't get anyone to buy three years before. So we're in early innings of a bull market. That doesn't mean there won't be some hiccups. You know, I think there's going to be, you know, again, we'll we'll get some of the the the people that are short-term players selling out stocks and uh, you know, it'll be healthy for gold to have a sell off and build a new base and then go to new highs. So, you know, but I think we're in early innings of a a major bull market. >> The um it it sounds like you're pretty pretty attuned to just the impact that low float or or a tight float can have just in in share price dynamics. think in, you know, in this bull market, even even my observations on some of the some of the stocks that are are most volatile to the upside, there there's absolutely kind of a a lowflat dynamic to what's going on. Combine that with with a bit of retail energy, and it doesn't take much to have just yeah, very outsized moves. >> That comes back to share structure again, too. And and and that's why it's important because you want to have a lower float. You want to have people that are committed longer term because when you go to raise money again remember most of these companies whether in Australia or Canada aren't making any money they they're spending money exploring or developing a project. So I want to make sure that when they raise money in the future that the capital costs are higher which is good for me as a shareholder uh less dilution and and a lot has to go you know we can use an example of an Australian company later if you want that again I I requested a year hold on the stock even though it was only a well you can do a no hold but not even a fourmonth I said you know everybody's holding their stock it's locked up for a year um it gives the company more room to run it gives the company the ability to build out their assets and raise capital at higher prices. So that's why we did that. >> And what might that stock be? >> Uh Concora Copper. It's actually dual listed. It's in the uh uh it's on your exchange there in Australia and it's in on the TS TSXV in Canada. It's a prospect generator, which you guys don't have a lot of in Australia. In the United States, we have, you know, more of those. It's a type of model and and it's a model that Rick Rule really pioneered 30 years ago. Um, and it increases your odds of uh success in making a discovery um with less delilution. >> The delilution is the the enemy of a of a of a junior trying to make a discovery and it's um it's unavoidable when you've got yeah like a a small market cap and a very capital intensive um you know binary kind of outcome on on on continuing exploration fund. So the prospect generator model you try and farm it out to other parties to spend the expiration and and you maintain a very very low kind of spend at the headco itself. >> Um >> correct >> how like why why is this like this this like a like more prevalent in in North America than it is in Australia from from your perspective? And um >> yeah, I can't answer that question why you do that except that maybe Australians like the the thrill of the chase even more. I mean, you still get that with a prospect generator, but the difference is instead of raising money to drill your property, which you know, again, doesn't always go the way you want it to and can take time. You're like, like you said, you're joint venturing your property out properties out to other people. And again, it's all about the people running the company. Just because you're a prospect generator model doesn't mean you're executing it properly. Using Concord as an example again, you know, two of their projects or yeah, two of their projects are joint ventured out to Anglo, a major mining company that's, you know, spending a lot of money on these that, you know, would be a lot of dilution, but at the end of the day, they're giving up a big piece of the property if there's a discovery to that joint venture partner. But being that Concor is looking for buried copper gold puries um which can take time, it's great to have someone like Angla with deep pockets who has a potential spend to earn into those projects of you know $90 million or something like that and they have several other projects joint ventured out with other companies. So next year they're going to see you know three, four, five properties drilled um that aren't going to dilute me as a shareholder. And what's great about Concora is that it's also very unique for an Australian listed company. It's only got about 42 million shares outstanding. Um we cleaned up the structure. You know, 30% of that's owned by reporting insiders, people on the board or management. And then like I said, Rick and I and a number of other North American investors um that that have experience in this space, you know, provided a $4 million of capital to them to uh and we put a year hold on our stock. So, you have a float that's, you know, very tight. You have management and board that's aligned with a long-term goal and you have a lot of drilling getting done next year that, you know, again, there's no guarantee you're going to find something. But again, in Concor's case, their technical team is bar none. I mean, you're talking about guys discovered Katy as you're talking about guys that were high up at New Crest before they were brought by Pneumont. They know your backyard. They're Australian and they know the Mcquaryy Arc. So again, it's a great speculation, but I'm not making stock recommendations. I don't have a newsletter. I don't sell anything. I'm a professional investor and you know, I tell everybody in interviews that, you know, and I don't know how this pertains to your Australian markets, but I see it here in the North American markets that, you know, I try to have a position of, you know, roughly 12 stocks that I have a large position in. And again, I have other ones because I know people and I do do financings. But 12 companies that are my my core holdings and make up a bulk of my money that's in that space. If you have too few companies, you know, again, you run the risk of there's still mother nature. There's luck. There's the overall markets. You know, you're not always in a bull market. So, you want to have enough companies that you have multiple shots to win. And on the other hand, I see so many investors here that I meet at conferences that ask me to look at their portfolio and there's 90 stocks in their portfolio that they printed out from their brokerage firm. Well, if you have a stock go from 15 cents to $20, that's great. But if you have 90 of those things, it's not going to affect your portfolio unless you know, again, so but a bull market does change that. But I like to follow a model where you don't have too many stocks. So, and and you lower your risk. So, I don't know if this is helping you, but >> how how do you spread your bets amongst those sort of 12 core names across commodities? >> Well, again, you know, if you're a a retail investor, not a professional, you want to get good advice from a broker or a a third party newsletter writer, a show like yourselves, you want to, you know, we've got the internet now. My daughter likes to tell me when I try to remember things and forget to look it up on the internet. But, uh, you can research a lot of this stuff. Do your research. And as far as, you know, everybody, you know, again, your your natural resource polio should be a slice of your pie. It's not your whole pie. And it's only, it really is for people that know what they're doing. That's why, again, I'm saying you shouldn't listen to me per se. Um, you should do your own research. But I personally like to have a basket of companies and different commodities. Um, I like to, you know, I say 25% and I probably have because I'm a professional, I probably have 16 companies right now. And plus, I think we're into a bull market. But 25% of those are prospect generators, um, which are again are farming out their projects. And just because something's a prospect generator doesn't make it a good deal. It's how you farm out your projects, who are your partners, what is the spend on those projects. So there's, you know, out of probably 50 60 prospect generators I know, there's six or seven of them that I think are making meaningful deals that that increase my odds because there's more money being spent on those projects. I also then I then I have the drill hole play. I still like to be terrified and go out and and drill something and and you know and usually it's a brownfield type project I'm looking for again with a good share structure and good management that has a past track record of success. So you know again right now I have three or four companies that are looking for copper gold. I've got a uranium company. I've got a rare earth company. I've got you know four pro four or five prospect generators. Probably four. One of them is not really a prospect generator anymore but that that's my portfolio. But just because it's my portfolio doesn't mean it's the right portfolio for someone else. >> Sometimes when the prospect generator when things go right, they pivot and they become not a prospect generator anymore. And um yeah, the it's like, you know, it's about the the discovery that was had. But when does a prospect >> and I actually >> I'm sorry. I didn't mean to catch up. >> Oh, that's okay. Yeah, I I'll let you finish, but I was just going to add when does a prospect generator go wrong? To the contrary. Well, I I t I typically like what I call the hybrid prospect generator model, which is a company that's got a number of projects generated out that's got companies spending, but they do spend some of their own money uh exploring their, you know, improving some of their 100% owned properties. And if they are lucky enough to make discovery, then they focus on that property. But again, I like a balance. I I kind of like the hybrid. And Concor is kind of like that. Even though they've got most of their projects available for joint venture, they have their gold project which they're keeping 100% and they're going to advance that a little bit further down the food chain, do some of their own drilling. Um, you know, and normally a prospect generator does the early work and, you know, brings a company in to do the drilling. So, in that case, Concor is, you know, I I have several companies, Concor Headwater Gold, that's a prospect generator here in Nevada and again, they're joint ventured out headwater with Pneumont. Uh they've got uh Oceanana Gold on other projects. They've got Centara is a 9% shareholder, their producer, but they have several projects that they're going to advance a little bit further. So Concor and Headwater are two companies that are hybrid prospect generators. Get the both best of both worlds. The um the to kind of like, you know, peel it peel it back a little bit. Um when when you see when you see like the market retail enter more liquidity a lot more volume in the lower end of town what are your like what do your instincts tell you to kind of lean in or to lean lean out? >> Well right now I I think the time is to finance companies with good people and good share structure. I think this thing's got a lot further to run. Although I think there'll be some pretty good hiccups along the way where people get scared out. Again there's a whole different mentality of investing in junior resource stocks. If you're investing $5,000 to make $10,000 and that's your goal, you again you can do that and you don't have to follow necessarily sheer structure. It's when you have bigger positions that you're not going to be able to trade and stuff. So in this market I think you know it's a speculative market. I think things are going to keep going higher. Um you know some of the stuff I would never want to own 9% of the company like I do in some of my companies. uh you know doesn't mean they're not going to go up fivefold and someone buying $10,000 worth. It just depends on what your goal is. And I guess you have to figure that out for yourself. >> Will you often or you know almost always encourage a a tra a transaction a corporate outcome? Is that the easiest way for for you to get out or do you sort of see plenty of the time you manage to sell down as the company just grows into itself? >> Well, in a bull market you manage to sell down or you know there's been bull market. I mean I say there hasn't been a bull market for 15 years but obviously uh there was a lithium bull market. There's been different bull markets in that time in commodities. The lithium stocks did really really well from you know I don't know up until two years ago. So four years ago I guess four and a half years ago uh you know the lithium stocks boomed and like we talked about I financed a company called Patriate Battery Metals at 16 cents. Uh later some Australian guys that you knew came in and financed it at 40 cents and and I was also involved in that financing, but that stock eventually went to $16 on a major discovery um with a management team that's built a lithium company before. Um and I took profits along the way because again at 16 cents, you know, I think I sold stock at $2 on the way up, but you know, again, but I was still selling stock at, you know, 12 and 14. So um yeah, it wasn't a transaction. It's still it's a tremendous asset. lithium prices came back 90%. So, the stock came all the way back to 250. Now, it's starting to move back up with the lithium prices. And if lithium continues to improve, it'll probably be a $16 stock again. But, but again, yeah, it's not always a transaction. And but I like to see a transaction because the other thing I don't like is when guys that are good developers or good exploration geologists try to put something into production and become mine guys, the transition obviously doesn't always work. So >> you you really play by these these kind of rules. Jeff, I'm I'm curious to hear if you if you look back in your career, when did you sort of land on this kind of model coming out the 90s into that bull run into to the 2000s? Have you been, you know, playing by the same sort of script since then or how did it all come about? >> Well, I think it comes about over learning over time. I've always tried to, you know,body can say this, but I, you guys don't know me, but here in the North American market, especially in Canada, I have a, you know, pretty good reputation of following through on what I say I'm going to do, being a good team player, and and again, that's what's important to me. It's not who makes the most money in the business. It's having a good reputation. Um, and also making money along the way. Obviously, that's part of the fun, but so I I've learned from experience. You know, when I first came in the market, I was 26 years old and it was a bull market. It was 1994 or something like that. And I thought I found, you know, I didn't know why I went to college. I thought, hey, I don't need to go to college. Everything I buy doubles in three weeks. I thought I found a broken slot machine. I didn't realize I was in a bull market. So I, you know, I learned and I got lucky that, you know, my partner and I ended up starting an oil gas company with a I don't know, a $20 million market cap when we took it public and we sold at 99 for 480 million. There was a lot of luck involved in that, too. So I but again I thought it was a broken slot machine. I didn't know that the resource market didn't always act that way. So >> what what was the sort of play there? Was it just sort of picking up a bunch of land and then the the cycle kind of changed or how did it sort of play out in your favor? >> The play in my oil and gas company or the play in the re the reverse market? >> The oil and gas play. Well, well, that was funny that, you know, we we were working with a company that was actually one of the most successful companies listed and and o over time I think the stock went from originally 75 cents to $10 back to 75 cents because of all the, you know, I learned that that a lot of the people that are big shareholders even the assets were incredible, they sold their stock and and tried to joint venture assets out to their own benefit to their other companies. But eventually that company went back from 10 to 75 cents and then new management came in because the assets were ungradable and went to $200 a share and because of that company over a 10-year period. Um because of that company we got wind of another oil and gas play in Wyoming and we were young. I mean we were 28 29 years old and we ended up staking as much ground on that hiring landman and you know it's bad episode of a cable show. We staked everything because we realized these two NASDAQ companies were and we leveraged ourselves to the tilt. You know, we had so much land we didn't, you know, you know, and luckily we brought management in that. I mean, the board was a bunch of friends and that, you know, again, we learned through experience, but we brought management in who actually run a a NASDAQ public company and retired, but he'd looked at what we had and said, "This is pretty incredible." And it was really those guys that two and a half years later were able to sell the company through development for for you know $18 a share or something. So again it wasn't total skill. It was a learning experience at 29 years old. And at that time I thought wow I'm going to retire. We were the largest shareholders of the company. But again uh you get bit by the bug and here I am 30 years later still doing this. >> That's awesome. >> Jeff, last question for you. What's your your your most um your most controversial view in the resource speculating sector? >> My most controversial view? I have a lot of controversial views. You want me to rank my most controversial? Um >> you can just give me one. >> I don't know that people's names would be involved in that. I don't know. you know, um, you know, my most controversial view is if you're really trying to develop an a a junior resource company that, you know, and you really are, that's, you know, if you're not just playing the and really this this hasn't changed since the gold rush. And I don't know your Australian history, but the gold rush here in California that built San Francisco. I mean, you know, Mark Twain has the famous quote, you know, gold mine's a hole in the ground with a liar standing over it. What a lot of people don't tell you is Mark Twain actually sold mining claims before he came up with that quote and and ended up writing for the newspaper. But uh yeah, I mean the bottom line it's the wild west this stuff. So you if I my most controversial view is I think they should go back to the year hold. I think all the exchanges would say look if you're going to get warrant coverage you at least have to be able to hold the stock for a year. um it would take the entire Mickey Mouse speculation out of it and you'd actually have people having to make smart decisions and a year is really not that long period of time especially when you're getting some sort of warrant coverage. So that would be very controversial because most people in the Canadian markets and the Australian markets don't want to be locked up. So >> I love it. That's a that's one I think we are very well aligned on. Jeff, really appreciate you coming on the show sharing how you think about the markets, how you think about investing in the junior space and yeah, thank you for for sharing that with our audience. >> Well, I hope this was somewhat helpful. And again, just to reiterate, I'm not giving investment advice. Any companies I mentioned are companies that I'm a large shareholder in and I probably consult for. You should do your own due diligence. look at stuff and and really soak as much information as you can from shows like yourselves and realize that you know you're you're investing is investing in in in earnings and dividends. This is educated speculation. So make sure you educate yourself. >> Beautiful. >> Thanks so much Jeff. Love the way he thinks about markets about the world almost as much as I love our partners mate. A big thank you to focus the platform by market techch Sanvic ground support IMAK the conference is coming up very soon next week actually we're going to be in Sydney so check that one out and last but not least in llinks huru who to root now remember I'm an idiot JD is an idiot if you thought any of this was anything other than entertainment you're an idiot and you need to read out a disclaimer