Today, we are breaking down the food catering giant Compass Group. Whether it's your corporate cafeteria, the food stands at a sporting event, or the old hospital food tray, the food services industry is all around you. Compass is the giant in this space, with a history that dates back to the emergence of this outsourced trend.

My guest is Asif Jeevanjee, Chief Executive of Oakmount Capital. Asif talks through both the business and the sector. How does the ecosystem work? What do contracts typically look like? And why had I heard of Aramark but not Compass, when Compass is nearly double the size? Here is another example of carving out an effective business model around an essential need product. Please enjoy this breakdown of Compass Group.

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For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Welcome to Business Breakdowns

(00:01:22) Understanding the Food Service Market

(00:05:03) Contract Structures and Retention

(00:11:47) The Origin Story of Compass Group

(00:17:33) Expansion into the US Market

(00:21:34) Sectorization and Market Penetration

(00:27:45) Growth Strategies and Pricing

(00:29:07) Financial Dynamics and Margins

(00:30:41) Procurement and Food Buy

(00:35:24) Labor Management and Technology

(00:37:55) Impact of Economic Cycles and Covid

(00:43:27) Capital Allocation and Valuation

(00:51:44) Lessons From Breaking Down Compass

(00:54:02) Key Lessons from Compass

Today we are breaking down EssilorLuxottica, a global leader in the eyewear industry, formed by the merger of Essilor and Luxottica in 2018. Today the business sports a nearly $130 billion market cap. EssilorLuxottica represents a vertically integrated business, encompassing design, manufacturing, distribution, and retail operations across both vision care and eyewear fashion segments.

To break down EssilorLuxottica, I am joined by Swetha Ramachandran who manages the Artemis ‘leading consumer brand’ strategy and is co-manager of the ‘global select’ and ‘global focus’ strategies. 

Swetha analyzes the strategic rationale behind the merger, assessing how it shaped the company's competitive advantages. 

We discuss the economics of prescription lenses, high-fashion sunglasses, and iconic brands like Ray-Ban and Oakley. We also explore the impact of emerging technologies like Smart Glasses, the Ray-Ban Meta glasses, and evolving consumer preferences on the eyewear market, as well as the competitive impact of upstarts like Warby Parker. Please enjoy this breakdown of EssilorLuxottica.

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For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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Octus, formerly Reorg, is the essential credit intelligence and data provider for nearly 40,000 professionals across the world’s leading buy side firms, investment banks, law firms and advisory firms. By surrounding unparalleled human expertise with embedded AI technology, data and workflow tools, Octus unlocks powerful truths that fuel decisive action in financial markets. Visit octus.com to learn how rigorously verified intelligence is delivered at speed to create a complete picture across the entire credit lifecycle. 

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Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Welcome to Business Breakdowns

(00:04:24) Essilor Luxottica: A Unique Business Model

(00:05:08) Market Leadership and Revenue Breakdown

(00:08:13) The Merger: Essilor and Luxottica

(00:10:18) Financial Performance and Strategic Investments

(00:12:22) Challenges and Competitive Landscape

(00:18:37) Global Operations and Market Strategy

(00:21:04) Innovations and Future Prospects

(00:22:36) Financial Analysis and Capital Allocation

(00:26:11) Competitive Pressures and Market Position

(00:28:47) Geographic Footprint and Strategic Growth

(00:30:44) Acquisitions and Strategic Endeavors

(00:32:38) Partnerships and Technological Integration

(00:35:13) Summary and Key Takeaways

(00:41:36) Lessons from EssilorLuxottica

Today we are breaking down Watsco, the market leader in HVAC distribution with a unique value proposition. If you've ever had an air conditioning issue, there's a decent chance it was a Watsco distributor on the other side of that phone call.

My guests today are Lucy Adams, Investment Director at Caledonia Investments, and Alan Murran, Co-Head of Public Companies at Caledonia Investments. Lucy and Alan help track the history of Watsco like the initial pivot from manufacturer to distributor and how Watsco formed relationships with the major OEMs like Carrier. We also dissect their reputation for a strong culture, with what has to be one of the most unique employee compensation plans in effect. Please enjoy this breakdown of Watsco.

Subscribe to Colossus Review

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Welcome to Business Breakdowns

(00:03:34) Watsco's Role in HVAC Distribution

(00:04:40) Watsco's Business Model and Services

(00:06:42) Real-World Example of Watsco's Impact

(00:09:28) Market Position and Competition

(00:12:55) Historical Evolution of Watsco

(00:15:52) Exclusivity Agreements in HVAC Industry

(00:18:05) Residential vs. Commercial Operations

(00:21:04) Growth Strategies and M&A Philosophy

(00:26:45) Carrier Joint Venture and Future Opportunities

(00:29:40) Watsco's Multi-Brand Acquisition Strategy

(00:31:34) Gross and Operating Margin Expansion

(00:33:24) Pricing Strategies and Market Dynamics

(00:35:16) Recurring Revenue and Business Model

(00:37:36) Cash Flow Management and Capital Allocation

(00:40:52) Technology Adoption and Digital Transformation

(00:45:50) Incentive Programs and Ownership Culture

(00:50:45) Risks and Competitive Landscape

(00:55:02) Lessons from Watsco

 ​Today, we are breaking down the  global alternative asset manager, Apollo. I reflected on my personal experiences with Apollo for this episode, and there's a saying that hard work can beat talent when talent doesn't work hard. Well, Apollo has talent, and Apollo works really damn hard. They will do everything they can to protect their capital, so if you're on the other side of the table from them, you never feel fully comfortable.

I am joined by Hunter Hopcroft, a financial analyst and writer based in New York. We get into what makes Apollo, Apollo, and Hunter share the backstory of how it was born out of Drexel Burnham and Michael Milkin’s DNA. We get into some of the early deals, the theme of craving complexity, how they differ from the KKRs or Blackstones, and the future of the industry.

Please enjoy this Breakdown of Apollo.

Subscribe to Colossus Review

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

—--

Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Welcome to Business Breakdowns

(00:02:49) Apollo's Current Landscape

(00:07:45) Apollo's Founding and Early Days

(00:10:39) Key Deals and Strategies

(00:17:09) The 2000s and Financial Crisis

(00:22:10) IPO and Public Transition

(00:25:47) Leadership Transition to Mark Rowan

(00:31:20) Rowan's Vision and Athene Merger

(00:35:12) Investment Strategies of Alt Managers

(00:36:28) The Athene Merger and Its Implications

(00:38:30) Rowan's Breakthrough in Spread Generation

(00:39:49) Innovative Asset Origination Platforms

(00:44:42) Private Credit and Market Dynamics

(00:46:49) The Future of Apollo and Private Credit

(00:52:09) Evaluating Apollo's Business Model

(01:05:33) Reputation and Evolution of Apollo

(01:08:50) Lessons from Apollo

Today we are breaking down machine vision leader, Cognex. Cognex Corporation is an American manufacturer of machine vision systems, software and sensors used in automated manufacturing to inspect and identify parts, detect defects, verify product assembly, and guide assembly robots. It is not your typical reoccurring revenue story. They are a self proclaimed cyclical that has tended to focus on a specific customer segment over time, looking for S curves that might trigger their next growth era.  

Our guest today is Brett Larson from NZS Capital. Brett and I covered Trane Technologies last year, and today he gives us a different angle on the industrial economy with Cognex. We get into the history of machine vision and how Cognex is a factory player. Please enjoy this business breakdown on Cognex.

Subscribe to Colossus Review

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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This episode is sponsored by Finley - modern debt capital management software for borrowers and lenders. Ask around and you'll find that nearly every operator or investor has experienced the operational nightmare of managing debt capital. Finley works by translating unstructured credit agreements into code, which gets all parties on the same page and helps them streamline the credit management lifecycle--think covenant reporting, interest and fee tracking, and portfolio analysis. Join the forward-thinking finance leaders, investors, and bank executives already modernizing their debt capital operations with Finley. Learn more and request your demo at finleycms.com. 

—--

Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Learn About Finley

(00:04:28) Overview of Cognex and Its Products

(00:07:29) Market Size and Growth

(00:08:23) Competitors and Market Position

(00:12:35) Sales and Customer Base

(00:13:48) History and Evolution of Cognex

(00:17:36) Deep Learning and Edge Learning

(00:22:42) End Markets and Applications

(00:26:32) Financials and Market Cycles

(00:28:54) Culture and Leadership

(00:39:13) Valuation and Risks

(00:43:54) Key Lessons From Cognex

Today, we are breaking down Rolls-Royce. A fair warning to those expecting to hear about luxury automobiles, that division was split from this business in the 1970s. But as we discuss the history of Rolls-Royce on this episode, you will hear how the DNA of this company still ties together from its early 1900s origins.

Our guest is Graeme Forster from Orbis Investments. Graeme walks us through the core business of Rolls-Royce in the aerospace market, the evolving duopoly of the wide-body aircraft engine manufacturers, and the ups and downs of properly capturing the economic opportunity. I really appreciated Graeme's intellectual honesty in discussing Rolls, and I expect you will, too. Please enjoy this Breakdown on Rolls-Royce

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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This episode is sponsored by Finley - modern debt capital management software for borrowers and lenders. Ask around and you'll find that nearly every operator or investor has experienced the operational nightmare of managing debt capital. Finley works by translating unstructured credit agreements into code, which gets all parties on the same page and helps them streamline the credit management lifecycle--think covenant reporting, interest and fee tracking, and portfolio analysis. Join the forward-thinking finance leaders, investors, and bank executives already modernizing their debt capital operations with Finley. Learn more and request your demo at finleycms.com.

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Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Follow us on Twitter: @JoinColossus | @ReustleMatt | @domcooke | @zbfuss 

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Learn About Finley

(00:04:54) Overview of Rolls-Royce

(00:08:35) History and Evolution of Rolls-Royce

(00:10:44) Rolls Royce's Aerospace and Defense Ventures

(00:11:57) Challenges and Nationalization

(00:14:43) Current Business Segments and Market Position

(00:20:57) Service Agreements and Profitability

(00:27:41) Engineering Excellence vs. Commercial Strategy

(00:31:26) The Aerospace Business Ecosystem

(00:33:11) Rolls-Royce's Margin Profile

(00:35:13) Challenges and Changes in Management

(00:37:28) Cost Structure and Revenue Optimization

(00:38:32) Engine Performance and Development

(00:40:04) Market Dynamics and Competition

(00:49:13) Future of Nuclear Reactors

(00:52:46) Capital Allocation and Management

(00:56:08) Lessons from breaking down Rolls-Royce

Today, we are replaying one of our favorites, breaking down the industrial conglomerate AMETEK. AMETEK is a great pairing with last week's episode on Jack Henry. These are two businesses with very long track records executing a playbook.

AMETEK is one of eight companies that Mark Leonard and his team at Constellation Software studied as they built their own empire. And it's one well worthy of a discussion as you'll hear. 

To break down AMETEK, I'm joined by Nael Fakhry, Co-CIO of the Osterweis Capital Management Growth and Income Strategy. Nael has spent a significant amount of time around AMETEK from the early 2000s until today. Please enjoy this breakdown on AMETEK.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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This episode is sponsored by Finley - modern debt capital management software for borrowers and lenders. Ask around and you'll find that nearly every operator or investor has experienced the operational nightmare of managing debt capital. Finley works by translating unstructured credit agreements into code, which gets all parties on the same page and helps them streamline the credit management lifecycle--think covenant reporting, interest and fee tracking, and portfolio analysis. Join the forward-thinking finance leaders, investors, and bank executives already modernizing their debt capital operations with Finley. Learn more and request your demo at finleycms.com.

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Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.

Follow us on Twitter: @bizbreakdowns | @zbfuss | @ReustleMatt |

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Learn about Finley

(00:02:52) An Overview of Ametek

(00:04:17) Ametek's Diverse Product Range 

(00:11:09) Ametek’s history: From Bankruptcy to Industrial Dominance

(00:20:22) Ametek's Growth Model: Innovation, Acquisitions, and Global Expansion

(00:25:23) Understanding Ametek's Finances

(00:29:37) Exploring Revenue Growth and Margin Expansion

(00:30:10) Incremental Margins and Cyclical Nature of the Business

(00:31:07) Operational Excellence

(00:33:35) Decentralized Approach

(00:35:21) The Role of Acquisitions

(00:36:33) Challenges and Risks

(00:38:45) Capital Allocation

(00:45:55) Evaluating Cyclical Business Performance and Resilience

(00:48:27) Dividend Policy

(00:49:44) Valuation and Growth Sustainability

(00:53:41) - Key Lessons

Today, we are breaking down Jack Henry. If you're not familiar with it, Mark Leonard of Constellation Software once referred to this business as their ‘gold standard.’ Jack Henry is a true best in class operator within the vertical market software space. 

To break down the business, I'm joined by Bob Desmond, Portfolio Manager and Head of Claremont Global. Jack Henry sells full operating system software that powers small and mid-sized banks. Like many great vertical market software businesses, M&A has been a piece of the puzzle, but Jack Henry puts a very deliberate focus on organic growth particularly in their core product. The stock has appreciated 480x since its IPO in the mid-eighties, but more recently, has been essentially flat over the past five years, and we get into great business dynamics versus stock dynamics. Please enjoy this Breakdown of Jack Henry.

Subscribe to Colossus Review

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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This episode is sponsored by Finley - modern debt capital management software for borrowers and lenders. Ask around and you'll find that nearly every operator or investor has experienced the operational nightmare of managing debt capital. Finley works by translating unstructured credit agreements into code, which gets all parties on the same page and helps them streamline the credit management lifecycle--think covenant reporting, interest and fee tracking, and portfolio analysis. Join the forward-thinking finance leaders, investors, and bank executives already modernizing their debt capital operations with Finley. Learn more and request your demo at finleycms.com. 

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Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Learn About Finley

(00:05:42) Jack Henry's Business Model and Market Position

(00:06:22) Colossus Review Announcement

(00:07:04) Deep Dive into Jack Henry's Operations

(00:09:43) Jack Henry's History and Culture

(00:12:44) Customer Focus and Competitive Advantage

(00:16:23) Growth Strategy and Market Dynamics

(00:19:37) Technology and Innovation at Jack Henry

(00:24:08) Customer Integration and Market Share

(00:34:50) Revenue Uplift and Customer Benefits

(00:38:57) Financial Metrics and Margins

(00:40:35) Cash Flow and Dividend Growth

(00:41:53) Cyclicality and Resilience

(00:48:04) Fintech Competition and Partnerships

(00:53:20) Customer Base and Market Shifts

(00:56:17) Risks and Cybersecurity Concerns

(00:59:22) Valuation and Long-Term Growth

(01:02:14) Key Lessons from Jack Henry

This is Zack Fuss. Today, we are breaking down APi Group, a leading provider of life safety and specialty services to buildings and construction projects. While not necessarily a household name, APi's services play a vital role in the buildings where we live and work. 

With over 100 acquisitions under their belt, they've strategically built a business that exceeds a billion dollars in EBITDA and sports a market cap exceeding $10 billion dollars.  The evolution of the business has come via an intentional shift from one-off construction projects to a recurring revenue model, generating a steady stream of income by providing essential services like inspections and maintenance of fire systems, elevators, security cameras, and more. 

To help us break down APi, I am joined by Adam Wyden and Chadd Garcia. Adam is the founder and portfolio manager of ADW Capital, and Chadd is a portfolio manager at Ave Maria Mutual Funds. Chadd and Adam will share their insights on the company's competitive advantage and go to market strategy, including its unique decentralized management structure and its strong culture. 

Please enjoy this breakdown of APi Group.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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This episode is sponsored by Finley - modern debt capital management software for borrowers and lenders. Ask around and you'll find that nearly every operator or investor has experienced the operational nightmare of managing debt capital. Finley works by translating unstructured credit agreements into code, which gets all parties on the same page and helps them streamline the credit management lifecycle--think covenant reporting, interest and fee tracking, and portfolio analysis. Join the forward-thinking finance leaders, investors, and bank executives already modernizing their debt capital operations with Finley. Learn more and request your demo at finleycms.com. 

—--

Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Learn about Finley

(00:05:34) Overview of API Group's Business

(00:08:54) Specialty Services Division

(00:10:59) API Group's Financial Profile and Growth

(00:17:18) Company Culture and Management Structure

(00:23:12) Capital Allocation and Strategic Acquisitions

(00:29:37) Understanding Stock Gains and Share Issuance

(00:30:51) SPACs and Martin Franklin's Reputation

(00:31:19) Challenges and Successes in Acquisitions

(00:32:55) Focus on Inspection and Service Work

(00:35:04) The Chubb Acquisition and Its Impact

(00:37:10) Financial Profile and Capital Allocation

(00:42:09) Valuation and Market Perception

(00:46:47) Lessons from API Group Investment

This is Zack Fuss. Today, we are breaking down Kaspi, a leading financial technology company based in Kazakhstan best known for its super app. Kaspi plays a central role in the lives of millions of Kazakh citizens by offering a seamless ecosystem that combines payments and digital wallets, e-commerce, and financial services. 

Its success is often attributed to its ability to solve pain points specific to the Kazakh market, such as low financial inclusion and limited access to traditional banking infrastructure. To break down Kaspi, I'm joined by the company's CEO and co-founder, Mikhail Lomtadze.  Over the past 23 years, Mikhail helped to transform Kaspi from a small traditional retail bank to the dominant platform it is today. He ultimately brought Kaspi public on the London Stock Exchange in 2020, and more recently listed the business on the Nasdaq Exchange in the US. 

We discuss the unique challenges of building a super app in an emerging market, how Kaspi differentiates itself from the global tech giants, and the company's ambitions to expand its footprint beyond its current borders.

Please enjoy this Breakdown on Kaspi.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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This episode is sponsored by Finley - modern debt capital management software for borrowers and lenders. Ask around and you'll find that nearly every operator or investor has experienced the operational nightmare of managing debt capital. Finley works by translating unstructured credit agreements into code, which gets all parties on the same page and helps them streamline the credit management lifecycle--think covenant reporting, interest and fee tracking, and portfolio analysis. Join the forward-thinking finance leaders, investors, and bank executives already modernizing their debt capital operations with Finley. Learn more and request your demo at finleycms.com. 

—--

Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

Show Notes

(00:00:00) Learn about Finley

(00:06:26) Mikhail's Background and Journey

(00:08:48) Kazakhstan's Economic Landscape

(00:13:05) Caspi's Mission and Evolution

(00:15:51) Building a Super App

(00:21:53) Focus on Payments

(00:24:50) E-commerce and Marketplace Expansion

(00:28:02) Entering the Grocery Market

(00:29:51) E-commerce Growth and Grocery Expansion

(00:30:10) FinTech Synergy and Competitive Advantages

(00:33:16) Kazakhstan Market Penetration and Growth Opportunities

(00:34:20) Vertical Expansion and Service Innovation

(00:35:28) Acquisition and International Expansion

(00:38:21) Company Culture and Product Development

(00:51:37) Super App Business Model and Market Strategy

(00:55:20) Lessons From Kaspi