Jonas Zatlyn-Weiner, Guest Writer
March 8, 2024
“People thought I was crazy for investing in Amazon!” Alex Sacerdote exclaimed as he addressed 35 students in the Putnam Library Glass Room. Sacerdote was the latest guest to address Nobles students as part of the Bullish Dawgs speaker series.As evidenced by his Amazon anecdote, unlike his colleagues and most of Wall Street, Sacerdote saw the immense potential of an online market.
As it turned out, Sacerdote was spot on: e-commerce was the future, and Amazon was heading for big things. Since making his prediction in 1999, Amazon’s stock has increased an outstanding 52-fold.
Sacerdote graduated from Hamilton College with a major in government and a passion for investing. He wanted to work at Fidelity after meeting with their analysts and hearing their deep understanding of companies. Sacerdote said, “They knew ten times more than I did,” referring to the companies he was researching.
After landing a job at Fidelity and spending several formative years there, Sacerdote set off to start his own investment firm in 2006, Whale Rock Capital.
The “Whale Rock Learning Machine,” as Sacerdote calls it, consists of Sacerdote himself and 10 other analysts. Annually, the team of 11 meets with over 2,000 CEOs and companies face-to-face to learn, as he says, “as much as is humanly possible” about which companies and products will perform the best. Today, Whale Rock manages $6-7 billion for big organizations and high-net-worth individuals.
Sacerdote also shared his investment strategy with the Nobles community. He urged students to look for one or two companies that had what he called “an amazing competitive advantage.” For example, Microsoft owns 95% of the PC market, a dominant monopoly that guarantees sustainable growth. Sacerdote stressed that an attractive theme with no competitive advantage ultimately fails.
What skills does it take to be an investor? Sacerdote firmly believes that it is imperative to be “passionate, curious, and always wanting to learn.” That mentality along with tireless research has enabled Sacerdote’s success, and he believes it can do the same for Nobles students.
Finally, Sacerdote encouraged all Nobles students to invest in three or four stocks they have researched deeply. Sacerdote recommended that students write a one-page report “to convince yourself” why each stock would be a good investment. Sacerdote was certain that any Nobles student who applies themselves can reap investment success. He urged the students in attendance, “Get some skin in the game!”
(Photo Credit: Alex Sacerdote)
