Laurence Hulse

So there's two sort of crosshairs or identifiers.

One is a set of quantitative mechanisms.

We use a tool called Quest, which is a cash flow modeling tool, but we use it in the opposite way of how it's designed to be used.

So an investor like Terry Smith or Lion Trust, they will look for quality compounders through the cycle, generating cash flow returns from their assets above the cost of capital, reinvesting them well, creating more cash flows is the simple kind of summary.

We actually look for situations in businesses where that isn't happening anymore, could happen, stopped happening, and go and ask ourselves why.

And there's six different scenarios we trawl the market for once a month.

You get six sort of shortlists, and then we spend the rest of the month shortlisting them into things that we should spend

proper time on or not.

So that's been historically the core of idea generation.

We do operate like private investors.

So we try and find our own ideas, our own pipeline, rather than take the traditional inbound broker calls, which makes it quite unpopular, but it kind of works.

And then the other, which is a little bit more recent, a past year or so, and this is a genuine benefit of artificial intelligence that everyone sort of wants to talk about at the moment.

For years, I desperately tried to read every R&S, and for listeners who aren't familiar, R&S stands for Regulatory News Service.

So every day, a company that is on the stock market

that has some important news to share, they have to announce it at 7am via RNS.

And I used to try and read them every morning.

Correct.

Or interesting.

And even with filtering out some of the sort of fairly vanilla or technical ones, it was just insurmountable when trying to launch a fund and grow it.

But the business I work at, Dowgate, bought in two sort of PhD types about a year ago to help our business take up costs through AI.