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AcquiredHoward Marks & Andrew Marks: Something of Value
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At a glance
WHAT IT’S REALLY ABOUT
Value vs growth investing: open-mindedness, judgment, and selling discipline discussed
- Howard Marks (Oaktree) and his son Andrew Marks (TQ Ventures) discuss their co-authored memo “Something of Value,” using a father–son dialogue to bridge classic value/credit frameworks with modern tech and venture realities.
- A central theme is avoiding rigid labels (“value” vs “growth”) and instead grounding decisions in discounted future cash flows, price vs intrinsic value, and the need for second-level thinking amid increasingly efficient, information-rich markets.
- They explore why disruption and accelerating technology change both increase uncertainty and expand upside through global and adjacent-market scale, making qualitative judgment about the future more important than ever.
- The conversation culminates in a nuanced debate on selling: when taking profits is rational (capped upside) versus when it destroys returns (rare compounding machines), and how firm-building choices should match temperament and strengths.
IDEAS WORTH REMEMBERING
5 ideasDon’t hardwire “value” vs “growth”—all equities are DCFs.
They argue every stock’s value is the discounted sum of future cash flows; the difference is how far out the cash flows are and how uncertain they are. Rigid style labels can blind investors to mispricings and changing business realities.
Open-mindedness is a core edge; rigidity is a profit killer.
Marks credits early high-yield success to going where others had rules and prejudices (“we don’t do that”). The memo’s throughline is evolving frameworks as the market/game changes.
Price matters as much as quality—great companies can be terrible investments.
The Nifty Fifty illustrates how “no price too high” thinking can lead to massive losses despite strong underlying businesses. Investing requires both forecasting business outcomes and comparing them to what’s already priced in.
Complex modern companies require deeper, less “knee-jerk” analysis.
Amazon is used to show how superficial income-statement conclusions missed favorable cash dynamics and strategic optionality (e.g., AWS). Today’s businesses often demand understanding reinvestment, cash conversion, and management-driven option value.
Disruption makes durability harder—but makes scale-based compounding more powerful.
They describe faster “Darwinism” (winners/losers faster) alongside increasing returns to scale (global distribution, adjacency expansion). The implication: fewer truly durable moats, but larger payoffs when they exist and are actively defended.
WORDS WORTH SAVING
5 quotesWhen you go to an auction and you sit down, take your seat, and you see there are no other bidders… that’s usually a good thing.
— Howard Marks
Moody said, “These bonds are not proper for investment regardless of price.” How can that be?
— Howard Marks
If you see a chart of a stock that’s been up for twenty-five years… think of all the days you would’ve had to talk yourself out of selling.
— Andrew Marks
The path to exceptionality cannot come through doing what everybody else does.
— Howard Marks
Most people sell because they’re up or because they’re down.
— Howard Marks
High quality AI-generated summary created from speaker-labeled transcript.
