Ready, Set, Try Again: Daily adventures of a Saudi entrepreneur

My New Blog

Abdulaziz Alnaim — Sat, 20 Aug 2011 09:09:54 +0000

“Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.”

– Warren Buffett

…

I have decided to stop updating my “Ready, Set, Try Again” blog, which was about my daily experience as an entrepreneur in Saudi Arabia. Writing that blog was entertaining (at least to me) and helped me better organize my thoughts. I also got a lot of encouragement and positive feedback from many readers and I’m thankful for everyone who supported me during that period. After having stepped down from my duties at Yareem Arabia a few months ago, I think it’s time for me to end this chapter of my life and move on to a new adventure.

While I consider my new venture, Mayar Capital Management, an entrepreneurial activity, it’s of a nature where most of what I wish to talk about and where the “action” is happening is related to investing. Therefore, I’ve decided to start a new blog titled “Profit from Folly” where I will be talking about my experience as a value investor and as a fund manager. I hope that my new blog will help some of you learn more about investing and, I hope, convert some to the value investing philosophy. Wish me luck!

Checkout my new blog at http://profitfromfolly.wordpress.com/

Interview with Michael van Biema

Abdulaziz Alnaim — Wed, 29 Jun 2011 07:25:21 +0000

Very interesting…

Kate Welling interview with Michael van Biema April 2011.pdf

27 June, 2011 09:43

Abdulaziz Alnaim — Mon, 27 Jun 2011 06:43:02 +0000

Here’s a small table showing the benefits of:

1- Small differences in annual investment returns

2- Living a long life

NOTE: This was inspired by Warren Buffett’s 1964 letter to partners

My presentation at Fikr9 – Dec 2010

Abdulaziz Alnaim — Wed, 22 Jun 2011 06:40:24 +0000

My presentation at Fikr9. It’s split between two videos.

Part 1:

Minutes: 10:16 – 17:45

Part 2:

Minutes: 0:00 – 6:00

10 June, 2011 22:49

Abdulaziz Alnaim — Fri, 10 Jun 2011 19:49:07 +0000

I discovered stock markets in 2000 when my good friend, Saud Al Blehed introduced me to them. After reading several books, especially Peter Lynch’s One Up on Wall Street, I was hooked. I started taking finance and economics classes while I was getting my engineering degree at MIT and eventually decided to switch majors to Finance after discovering I was much better financial guy than I was an engineer, despite being a geek all my life. That was more than ten years ago. I have been investing in stocks for more than a decade and now, having relinquished my role at our restaurant company (Yareem Arabia) I’m back focusing on running my investment fund. It’s been two months since I quit running Yareem Arabia and just over a month since I started focusing completely on the fund (I took 3 weeks off in between). I think i still haven’t fully recovered from what operations can do to a person, but I’m finally back go looking forward to each new working day. It’s nice, I miss that. There’s still a ton of work I have to do go fully “re-launch” my career as a fund manager and investor, but I’m happy I’m on track. After managing an operation for about 5 years I now know for sure that I simply hate doing that. Life is too short to do something you don’t enjoy and I enjoy investing. I enjoy the research process and I enjoy “pulling the trigger” and making an investment. It’s as close as you’ll get outside academia to being a purely intellectual exercise, so it’s not for everyone. But i also enjoy the non academic part of making the investment decision and living by it for years (my average holding period is around 4 years). The operations “detour” I took set me back a little bit in the fund, but looking back I now realize how beneficial it was for me in terms of learning more about business. It was much better than an MBA or anything like that. I believe I am and will be a much better investor after starting and building a business for these pat few years. But I am also happy to put that phase of my career behind me. With my back office fully outsourced, I can focus on research and finding good investment ideas to include in the fund portfolio. With the focus I can now afford to give the process, I’ll be able to find great ideas and improve my earlier decent-but-not-amazing track record. One day I plan for people to hear about Mayar Capital Management and recognize it as one of the savviest and successful asset management firms in the world. I also plan to be billion of dollars richer. Inshallah.

3 June, 2011 23:29

Abdulaziz Alnaim — Fri, 03 Jun 2011 20:29:34 +0000

“The most common cause of low prices is pessimism – some times pervasive, some times specific to a company or industry. We want to do business in such an environment, not because we like pessimism but because we like the prices it produces. It’s optimism that is the enemy of the rational buyer.” – Warren Buffett

I just launched my new fund, Mayar Fund, and it’s looking like we’re lucky to be buying in a relatively pessimistic environment. Since we’re still raising money and making purchases (today were 30% invested) I’d like to see stock prices go down, even by a lot so we can make better purchases at cheaper prices. If anying, I wish we’d see 2008 prices again soon because that’s a great way of making a killing investing in stocks. Like all value investors, I find my best ideas in times of great pessimism and turmoil in stock markets. Were no where near 2008 levels in terms of valuations but I still am able to find many good ideas right now and I’m optimistic that at least markets will continue in this range for enough time for us to commit most of our capital at current or lower valuations. I hope. That would be the best outcome for our fund investing partners. Unfortunately, bad markets will hurt me by making raising money a lot more difficult, and it’s already difficult with many investors barely recovering (or not) from the losses they incurred in the 2008-2009 financial crisis.

So of course I’m torn. Great markets would make the fund raising easier but the real job–investing that money–much harder. Also, I’m always felt more comfortable doing the investing , so that’s why I am happy to have my partner, Abdullah Al Ajaji doing most of the fund raising right now and letting me enjoy reading financial reports and regulatory filings…ahhh this is so much fun, I’m so happy im no longer running the restaurant company! I remember when I was in college I spent most of my free time reading books about investing and companies annual and quarterly reports. I remember at least one spring break where I packed a big box of them and flew down to my friend, Tariq Almuhareb in Florida where I spent my break eating and reading the stuff, heaven on Earth! My friends in Boston thought I was a total idiot but of course, being me and almost totally unconcerned about what others thought of me, I laughed it off… Even in Boston I sometimes spent full days doing nothing but research late into the night. It’s fun, am I’m so happy to be back focusing on it. One more thing I remember is a show I used to watch on Friday evenings, the late Louis Ruckieser’s Wall Street, the perfect start for the weekend.

Article about launching the Mayar Fund in MENA FM

Abdulaziz Alnaim — Wed, 11 May 2011 17:08:00 +0000

"Boutique Saudi fund manager launches debut fund"

http://t.co/9pP03K8

14 April, 2011 19:58

Abdulaziz Alnaim — Thu, 14 Apr 2011 16:58:11 +0000

I’m reviewing what I hope will be the final draft of Mayar Fund’s PPM (Private Placement Memorandum) and just received an email from our brokers (Jefferies) telling me that our account is now open!!!! Wooohooo!

3 April, 2011 22:22

Abdulaziz Alnaim — Sun, 03 Apr 2011 19:22:11 +0000

Here I am, starting again almost from scratch (hopefully wiser). Alone at my new company’s office, doing everything myself. Startup junkie? Maybe. The experience with Yareem Arabia has taught me a lot about starting and building companies and I believe this knowledge is transferable. This time I will do a better job and avoid most of my past mistakes. I’m sure I will make some new mistakes, but now I’m stronger because I’ve been beaten up real hard.

To new and better beginnings. Ameen.
`

3 April, 2011 08:53

Abdulaziz Alnaim — Sun, 03 Apr 2011 05:53:03 +0000

A few days ago I stepped down from my position as Chairman & CEO of Yareem Arabia to focus on my new company, Mayar Capital Management. The past five and a half years were one of the most exciting and challenging years of my life. I have succeeding and failed many times over, and have learned so much from that experience. I believe I am a better investor and better fund manager today because of my experience running, of all things, a startup. This decision was one of the most difficult I’ve ever made. Yareem Arabia and its restaurants and cafes were (are?) like children to me and “moving on” is never easy, let alone when you’re so intertwined emotionally with a company. But the time has come for me to move on and for someone else to take over. The memories will always be there, even though many were one of the most painful I’ve ever felt. No experience has caused me such a wide range of pain and pleasure, and sometimes in the same day. I remember the early days doing things with my own hands. I remember paining tiles and walls and spray painting designs on the ceiling. I remember training baristas how to make coffee or a sandwich. I also remember all the fights with all the contractors and all the employees. I remember many of the hiring decisions (good and bad) and many of the ugliest firing decisions. But I was blessed with many wonderful colleagues and partners throughout those years. I remember good relationships and team work, but I also remember some of the most dysfunctional relationships with other colleagues. I remember days when we only had 500 SR in sales and how that turned into days we had forty thousand in sales. The pleasure of hitting new sales records and the pain of disappointing results. I’ve experienced all that. It was shitty a lot of the time and felt like a never-ending nightmare at times. Yet somehow, at other times, it felt like it was all worth it. I still don’t know how I will look back at those past five years in the future, I think it will be months or years before I can truly figure out how I exactly feel about them. For now, I will just say I’m thankful I had the experience.

PS. Please keep going to Burger Joint and Graffiti (I still own all my shares and sit on the Board :p)