Well one of my favorites is Carl Icahn.
Time Magazine called him the master of the
universe on the cover of Time Magazine.
And I’ll tell you when I first went to meet
Carl most people know him as a pretty intense
guy.
I walked in that day with my video crews you
guys have here and he says I want all these
guys to leave.
I said what?
He said I don’t want a video crew.
I said but you agreed to it this morning.
He said I don’t care.
I don’t want it.
I said okay, well how about if my audio team
comes in.
And he said no audio team.
I said well what am I supposed to do here?
He goes bring a pen and paper.
You’ve got ten minutes.
And, you know, I scheduled my meetings for
45 minutes and to go deep they usually go
three hours.
But to his credit, you know, he’s had so
many people attack him that he needs to know
what you’re really about.
When he saw I was sincerely about teaching
what he knows to individual investors and
really empowering them he became very passionate
and he gave me almost three hours.
He endorsed the book.
He’s been extraordinary ever since and has
actually become a friend.
So Carl is a teddy bear underneath and he
really does care.
But his results are unquestioned.
As I said earlier how about a 1600 percent
return if you’d invested with him over the
last 13 years versus 75 percent for the S&P.
As I said since 1968 a 30 percent compounded
return if you’d been with him during that
time, outstripping even Warren Buffet.
But what’s interesting about him is he really
believes that the challenge in stock and in
business is that it’s an old boys club.
That’s his view.
And that what happens is the people that get
elected are the people the most liked and
the board does what’s best for the board.
And that, you know, there’s so much that
isn’t really looking out for the individual
investor so that’s what made him an activist
and he’s very intense and he goes in and
he buys enough stock to have an impact and
shakes their world.
Lets them know that they’re going to be
fired unless, you know, they make some significant
changes.
And the results of what he’s produced though
are incredible.
A lot of people say he’s just got in and
out so that’s why I put in the book an actual
track record.
You see he stays with most of these investments
for a very long time.
There’s very few that he goes in and out.
In fact a Harvard law professor, I put the
study in the book shows that of over 2,000
activist interventions that have been done
the vast majority of them have made the company
much more profitable for almost a decade afterwards,
not just for a few months or a few years.
Because what happens is management is what
maximizes resources in a company.
And when management gets unhungry or comfortable
or maybe supporting a certain strategy or
approach you’re not going to get the most
out of it just like the rest of us as human
beings.
And Carl is one of those guys that comes and
shakes that stuff up.
And when he comes you know things are going.
The day that I go into see him he just recently
had done a Tweet saying that Apple was undervalued.
And within two hours of that Tweet Apple stock
went up 17 billion with a B, billion dollars
in value by one Tweet.
And people said oh, he did that to manipulate
the market.
He didn’t manipulate the market.
He stayed in.
He’s still in.
He kept on buying more and more of the stock
even as the price went up because he thought
the company’s really worth it.
And in Apple’s case he was pushing them
to try and release a certain amount of money
to shareholders in the form of dividends.
I think he asked for 150 billion.
And I said well did you really think you were
going to get that?
He said no, but I figured if I pushed 150
billion maybe I’d get 70, 80 or 90 and I
think he got 90 billion if I remember the
right numbers.
The numbers are so huge it’s mind boggling.
But he’s still with them.
The day I visited with him he closed out on
a stock that he put in I think it was 30 million
and he made 2 billion in 18 months.
It was called Netflix.
And he shared with me, he said Tony, you know,
when I took over Netflix I said do you always,
you know, mess with the management?
He goes not if they’re doing a great job.
He said that’s people’s misunderstanding
about me.
I look for great companies.
And if the great company is being managed
well I’m just there to make sure they keep
being managed well.
And he said with Netflix he said he explained
to me that the chairman of Netflix and CEO
of Netflix came and was sitting right where
you are right now Tony.
And he said, the guy said to me look Carl,
we’ve had 100 percent increase in the stock
in six months.
And he said do you really need to work to
change the board right now?
And Carl said, I looked at him and I said
I have a simple rule.
It’s called Icahn’s rule.
Anybody that makes me a billion dollars in
six months I don’t punch them in the mouth.
So Carl’s a character.
He’s amazing.
He’s brilliant but he’s out not just for
himself.
He’s truly out for his investors.
And anybody that’s stayed with him has made
a fortune.
He’s also if you’re watching this one
of the only hedge fund guys you can get access
to without hedge fund fees.
So take a look at that in the book.
I explain how you can do that.
There’s no other hedge fund member I’m
aware of that you can do that without having
to pay their 2 and 20 if you know what that
means.
Anything he moves into you probably want to
take a look at because if you look at the
history of where he’s invested, the day
he invests and the day he got out – if you
followed that pattern – he said so himself
in the interview – you’ve had a giant
return.
I forget the number but it’s in the 20 percent
range that’s there.
But I think also he’s inspired another group
of activists.
He’s looking out, getting other people to
look out for investors.
Coca Cola, one of the, you know, greatest
companies in our history in terms of success
anyway has recently gone to – they were
creating out a 24 billion dollar campaign
for the executives in the company to basically
give discounted stock.
It would reduce the value of the company by
that much.
And Warren Buffet is, you know, the largest
shareholder there and he didn’t say anything.
And Carl went a little crazy and he’s willing
to say anything.
And he wrote to The Wall Street Journal.
He wrote to Warren Buffet and he published
it and said how can you let this happen?
And Warren abstained the vote and said I don’t
agree with it but he abstained, he didn’t
vote against it.
And, you know, Carl was like that’s not
right.
This is not right for investors.
So I would say listening to what this guy
says – he’s not always right but he’s
somebody worth looking at because when he’s
looking at a company there’s likely opportunity
and it’s also interesting to see some of
the people now, younger people that are starting
to become investors that are tackling some
of these challenges like Coca Cola and really
bringing attention to these things so investors
can be protected and so investors can get
the returns they deserve.
