In this episode, Bain Capital Co-Managing Partner John Connaughton discusses how the pandemic has impacted his long-term investing strategy, why he thinks taking “calculated risk” is key to being a successful investor, and key lessons he’s learned from past investments.
On the long-term investing implications of the crisis: “We can actually look at tech disruption, which was everywhere, and it’s actually even increased during the crisis. So the opportunity to invest in our tech platform is going to be critical for not only our tech businesses, but also the other sectors that we participate in; how to utilize technology in education, in consumer, in healthcare. And those trends have accelerated through the crisis and so they present big opportunities for us.”
On what makes a successful investor: “I think the first thing that people understand about investments as they get more experienced is that you have to take risks. And importantly, that doesn’t mean you’re a gunslinger, that doesn’t mean you’re an instinct player. It actually means that you need to pull the trigger and you need to actually have a point of view around what is a good calculated risk. And the way to create a calculation of that risk is to really be able to analyze everything that can be knowable. And there’s a lot that’s unknowable. But if you actually do the work, create the primary analysis of your insider thesis and then actually take the calculated risk, that is the best way over time to be an investor that has an upside and a better return profile than people who don’t do the work, who actually just use their instincts.”