Cathie Wood: Elon & Twitter; Why Facebook is a Value Stock Now; ARK's Performance | 20VC

Cathie Wood is the CEO & CIO @ ARK Invest, focusing solely on disruptive innovation, primarily in the public equity markets. ARK has become renowned for opening up its research and becoming a ‘sharing economy’ company in the asset management space. Prior to ARK, Cathie spent twelve years at AllianceBernstein as CIO of Global Thematic Strategies where she managed over $5 billion. Cathie joined Alliance Capital from Tupelo Capital Management, a hedge fund she co-founded, which managed $800 million in global thematic strategies. Prior to Tupelo Capital, she worked for 18 years with Jennison Associates LLC as Chief Economist, Portfolio Manager and Director.


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Timestamps:

0:00 Who is Cathie Wood?
1:15 What are you running from and towards?
3:45 Lessons from the Bust of Tupelo
7:25 Is there too much money chasing too few deals?
10:35 How do you handle being down 80-90%?
15:03 When is the time to sell?
20:32 Views on Risk Management
23:33 Why hasn’t ARK had more outflows?
26:27 Why does ARK make its research public?
28:38 Why did ARK launch a venture fund?
33:07 How incentives work in a 0% carry fund
38:57 How do you win access to the best deals?
43:55 Capital Planning in an Open Evergreen Fund
46:50 The Risk of Investing with ARK
49:03 Cathie’s Favourite Book
49:36 Why Facebook is a Value Stock
50:55 Elon and Twitter
53:17 Best Investment Advice Cathie Ever Received
55:17 Where would you put all your money?
56:22 Future of ARK



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In Today’s Episode with Cathie Wood We Discuss:

1.) Entry into Hedge Funds at 20:

How did Cathie get her first role in the world of finance at the tender age of 20?
What is Cathie running from? What is Cathie running towards?
What are some of Cathie’s biggest lessons from seeing the dot com bust at Tupelo?
What does Cathie know now that she wishes she had known when she started investing?

2.) Why Benchmarks and Passive Investing are Bad:

Why does Cathie believe that benchmarks and indexes have become dangerous for consumers?
Why does Cathie not believe what everyone else does regarding inflation?
How much of the performance of large-cap tech stocks is tied to the growth of passive investing?
Why does Cathie think the Fed is making a huge mistake?

3.) Time to Pick Companies:

Why does Cathie believe that Facebook is emerging as an attractive value stock?
How does Cathie believe Elon Musk and Jack Dorsey could build the largest universal wallet?
If Cathie were to put all her money into one of their companies, what would it be?
Why does Cathie believe Zoom is one of the most misunderstood companies?

4.) Why Venture: Why Now:

Why did Cathie decide to do a venture fund with ARK now?
Why did Cathie decide to do a no-carry structure with a higher management fee? How does that align incentives with investors?
In venture, the asset chooses the capital, how does Cathie analyze why the best founders in the world will pick and work with ARK over other amazing VCs?
What is the single biggest risk you are underwriting when investing in ARK’s venture fund?


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