Sam Hafermann Spring 2024 Update

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I hope that you are keeping well and the start of the year has treated you good. This is my first iteration of a personal email update for family and friends. It’s been great reconnecting with folks I may not see as often with all of the recent wedding activities, and I figured this would be a fun way to stay in touch with a broader group. I hope that the material below is interesting, useful, or helpful to you.

 

My motivation is to serve you with interesting ideas and resources while sharing a brief update of what I’ve been working on, what Maria and I have been up to personally, etc. If I'm successful, you in turn might reciprocate and share something cool you’ve worked on or read recently back to me.

 

Topics this Time Around:

• Underwriting a Potential Venture Investment in Levels Health

• The Case for Queso – An Overview of the Hispanic Cheese Market

• Company Write-Ups, White Papers, Podcasts

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If you no longer want to be on the list, please use the footer of this email to unsubscribe.

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Lastly, feel free to write me back with feedback. And if this email was forwarded to you, do consider subscribing directly here.

 

With warm regards,

Sam Hafermann​

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Underwriting a Potential Venture Investment in Levels Health

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Combining a continuous glucose monitor (CGM) with intelligent, easy to use software, Levels allows users to track their blood glucose levels in real time. The company provides the first means of accessing your body’s metabolic data to see the effects of diet and lifestyle decisions as they happen in real time.

 

After being a happy customer for the last six months and talking with a few of their employees, I got really interested and decided to go a bit deeper into the business model. The more I dug, the more fascinated and impressed I was with what the Levels team has built. I recently looked at potentially investing in the company’s Series A extension round and wrote up a memo to help organize my thoughts. If you are interested in learning more, feel free to give it a read.

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The Case for Queso – An Overview of the Hispanic Cheese Market​

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Next up is a write-up I did recently on the U.S. market for Hispanic-style cheese. With the massive wave of immigration over the last 20-30 years, Hispanic cheeses have exploded in popularity and are showing no signs of slowing. It’s a super interesting market underpinned by the incredible economic progress that the Hispanic immigrant population has brought with them to the U.S. I was fortunate enough to be exposed to the product first as a consumer from my wife (who's originally from Colombia), and then professionally when we did a pretty deep dive for an acquisition in the space through my day job at Prestwick Partners. Although it is originally written by me, the piece comes out so well because of the amazing people I’ve had the pleasure of working with over the years.

 

The bulk of the credit should go to my partners at Prestwick, who have taught me so much over the years about what high quality investment and industry analysis looks like, and more importantly, how to communicate that in a succinct and interesting fashion.

 

The remaining credit goes to my eternal cheerleader, and biggest critic – my beautiful wife, who first brought me into the wonderful word of queso blanco, quesito, and many others. I hope you enjoy.

 

​Company Write-Ups, White Papers, Podcasts

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In part, I’d like to use these email updates to encourage and receive insights from others. As I regularly say in my office “I like to read.” I get sent a lot of interesting material through my work and from perusing niche rabbit holes of the internet in my spare time. When the sender is okay for me to share, and it meets my quality standards, I’d like to do that.

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It helps the writer. It also helps me. It’s a virtuous cycle.

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David Kim (scuttleblurb) on Roper Technologies

I really enjoyed this recent write-up on Roper Technologies, a company that functions as a quasi-private equity firm, Berkshire Hathaway/Constellation Software-type holding company conglomerate. David’s piece gives a fantastic history of the businesses’ transformation from a cyclical industrial pump, valve, and control manufacturer in the 90s, to its current position as a leading serial-acquirer of vertical market software businesses that have a dominant #1 position in small markets with exceptionally high returns on capital. David is an extremely talented investor, analyst, and writer. He’s the managing partner at Forage Capital, a boutique, long-only Portland-based hedge fund that he launched a few years ago after spending time at Fidelity and Citadel after finishing business school at the University of Chicago. In short, he’s one smart dude and an even better guy. Doesn’t hurt that his newsletter is criminally underpriced for the quality of analysis he provides. Note: Post is paywalled (email me for a PDF copy if interested).

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Morgan Housel on How This All Happened, A Short Story on the U.S. Economy Since WWII

Morgan is a savant at distilling esoteric financial topics into crisp, entertaining prose. He’s without a doubt one of the best business writers of the 21st century. In this piece, he takes a retrospective look at how the social, political, and economic factors wove their way through various war and peace times to give readers a sense in layman’s terms of how the U.S. progressed as a country since WWII. In a quick 15-minute read, he manages to eloquently distill topics that could easily make up a 5,000 page volume. Highly recommend.

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The Complete History and Strategy of Hermés by Ben Gilbert and David Rosenthal

If you can manage to make a 4-hour long business podcast where at the end I’m disappointed it wasn’t 3x longer, you’re doing something right. This incredibly thorough biopic of a podcast episode goes through the complete history of luxury brand Hermés. The folks at Acquired have done a fantastic job over the last few years, and this epic Hermés deep dive is in the running for my favorite podcast episode of all time. The mystique that surrounds the brand comes from a multi-century commitment to handmade craftsmanship and unwavering focus on the business’s original founding principles. In an industry defined by constantly changing trends, it is fascinating to learn how Hermés has managed to unanimously persist atop the luxury pyramid while selling pretty much the same exact product for the last five or six decades. Perfect for a long bike or car ride.

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Here are some additional worthwhile reads, listens, and watches:

 

The Century of the Self – A documentary about how people in power have used Sigmund Freud's theories to control and manipulate crowds. It discusses the relationship between Freud and Edward Bernays, who was Freud's nephew and the founder of public relations. If you're interested in advertising, narrative control, and crowd psychology, you will love this documentary. Oh, and here's the full transcript.

 

The Art of Learning: An Inner Journey to Optimal Performance – This might be the most impactful book I've read in the last year. Written by Josh Waitzkin, a child chess prodigy that won seven national team championships between the third and ninth grades during his time at Dalton, and then two world Junior World Chess Championships thereafter. After dominating the scholastic chess world for ten years, Waitzkin expanded his horizons, taking on the martial art Tai Chi Chuan and ultimately earning the title of World Champion. He explains in clear, thorough detail how a well-thought-out, principled approach to learning is what separates success from failure. The book is a masterful combination of an autobiography, Tao Te Ching-type Zen philosophy text, with a how-to guide to learning how to be the best in the world at something sprinkled in there for good measure. I sped through it in a weekend. Could not recommend highly enough.

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Well, that's all I've got for you this time around. I hope you were able to find something that resonated with you.

 

Cheers,

Sam Hafermann

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