"Look for great people of great character who make wonderful decisions on behalf of all the stakeholders they oversee."
Good Management:
Sometimes it's difficult to see the people behind the businesses. Instead, we focus on the product, competition, stock price, etc.
If you plan to hold a stock for 3-5 years, it's crucial to invest in good management teams.
There are several ways to evaluate management teams. Here is a simple 4-step framework you can use.
The Y.O.D.A. Leadership Framework
Y-outhful: Do they have a proven track record from an early age?
O-wner: Do they hold an ownership stake greater than 5% in the company and have an ownership mentality?
D-elivers: Do they deliver results for all stakeholders?
A-mbitious: Do they have BIG goals and a global vision?
Smart Backing
When investing in early-stage companies, it's essential to understand where the capital is coming from to fund the business.
You want funding from smart VC firms with proven track records. This provides the business with trusted advisors who can also serve as board members.