OUR INVESTMENT PHILOSOPHY

VVCM focuses on identifying companies with exceptional business models capable of delivering sustained growth and compounding value over the long term

Our Blueprint for Successful Investing

VVCM’s investment philosophy centers on identifying businesses poised for multi-decade growth. We target companies with durable competitive advantages (“moats”) and a track record of accelerating revenue, earnings, and free cash flow. We prioritize capital-light businesses with expanding margins and high returns on invested capital.

Our investment approach emphasizes finding undervalued companies with strong management teams focused on efficient capital allocation and shareholder value creation. We believe these factors, combined with a long-term investment horizon, position our portfolio for sustainable growth and superior returns.

Furthermore, VVCM is committed to client success through transparency and a focus on aligning our interests with theirs. We strive to build lasting partnerships and deliver exceptional investment results over the long term.

PORTFOLIO CONSTRUCTION

Portfolio construction is a critical process that is continuously and rigorously monitored to ensure its effectiveness and alignment with the core tenets of our investment philosophy.  At VVCM, newly established positions undergo stringent assessments based on business quality, financial metrics, and operational standards.  A focused portfolio of strongly held convictions is the key to consistently generating above average returns.  

RISK MANAGEMENT

Risk management is a fundamental component in preventing losses. We adhere to Warren Buffett’s cardinal rule: Rule number One is not to lose principal capital, and Rule number Two is to never forget rule number one.

VVCM aims to mitigate risk with meticulous stock selection of high-quality businesses, high margin of safety, while employing minimal leverage, avoiding speculative securities and maintaining a liquid portfolio. Additionally, we opportunistically use options to mitigate market volatility risk, allowing us to hedge the portfolio.

Investment Philosophy: VVCM’s Approach to Long-Term Growth

At VVCM, our investment strategy centers around identifying businesses with multi-decade growth potential. We adhere 10 core principles:

  1. Expanding Moat of a Business: We seek companies with a durable competitive advantage—a widening “moat.” This advantage can stem from brand strength, network effects, or technological leadership. A robust moat ensures sustained growth and protects against competitors.
  2. Accelerating Revenue Growth: We prioritize companies that demonstrate consistent revenue growth. Rapidly expanding top-line figures indicate strong market demand and a competitive edge.
  3. Accelerating Earnings Growth: Earnings growth is a key driver of long-term value. We favor businesses that consistently improve profitability through efficient operations, innovation, and effective cost management.
  4. Accelerating Free Cash Flow: Strong free cash flow generation is essential. Companies that consistently produce excess cash after covering operating expenses and capital expenditures are attractive to us.
  5. Expanding Margins: Companies that expand profit margins over time are well-positioned for success. We analyze factors such as operational efficiency, pricing power, and economies of scale.
  6. Above Average Return on Invested Capital (ROIC): ROIC reflects how effectively a company generates returns from its invested capital. We target businesses with above-average ROIC, as it indicates efficient capital allocation.
  7. Capital light business:  A business model that operates with minimal capital expenditures (CapEx). These businesses typically require fewer physical assets and infrastructure investments
  8. Low Valuation at Time of Investment with Future Multiple Expansion: We look for undervalued opportunities. A low valuation provides a margin of safety, and we anticipate future multiple expansion as the market recognizes the company’s true worth.
  9. Superior Management Focused on Capital Allocation: Exceptional management teams allocate capital wisely, reinvesting in growth, acquisitions, or returning value to shareholders. We assess management’s track record and alignment with shareholder interests.
  10. Client Focus: Our commitment extends to our clients. We prioritize their interests, transparency, and long-term success.