The business began not with a market opportunity, but a personal one. Founder Robert Boucai realized his best after-tax returns came from real estate, but no existing general partners offered the tax-efficient, long-hold, high-alignment structure he wanted for his own capital. He built the firm to be the optimal solution for himself first.

Identifying flawed investments, especially in opaque markets like private credit, is rarely about one decisive discovery. It involves assembling a 'mosaic' from many small pieces of information and red flags. This gradual build-up of evidence is what allows for an early, profitable exit before negatives become obvious to all.

Tom Gaynor holds around 100 small positions not for financial return, but as a "farm system." Owning a small piece forces him to pay closer attention, providing a broad awareness of industries and management teams that informs decisions on his larger, core holdings.

Templeton sought stocks so unloved they were like books in a dusty basement corner nobody visits. Actionable signals of such neglect include zero institutional ownership or IR departments that haven't received calls from investors in years. This is where the greatest price inefficiencies are found.

The CCC-rated segment of the high-yield market should not be treated as a simple down-in-quality allocation. Instead, it's a "stock picker's" environment where opportunities are found in specific, idiosyncratic situations with high conviction, such as a turnaround story or a mispriced part of a company's capital structure.

Facing a massive tax bill on his appreciated Coca-Cola stock in the late 90s, Buffett used Berkshire's then-expensive stock as currency to merge with bond-heavy insurer General Re. This move diversified his portfolio into safer assets that rallied when the tech bubble burst, all without incurring taxes from a direct sale.

Tom Gaynor sold CarMax based on a flawed thesis about COVID's impact. However, the decision was driven by a correct higher-order process: de-risking the entire portfolio to ensure Markel's survival. This highlights prioritizing process and survival over being right on a single outcome.

After early failures, Orlando Bravo pioneered software buyouts. This was a contrarian move, as the prevailing view was that these companies were either too old or too risky. This niche focus on making unprofitable software businesses viable became the foundation of his firm's success.

Tom Gaynor's ability to act as a principal was enabled by his wife's stable engineering job. This psychological and financial safety net allowed him to take long-term risks at Markel without fearing for his family's basic needs, a crucial but often overlooked factor in professional success.