#364 Nick & Zak's Excellent Adventure: How Nick Sleep and Qais Zaharia Built Their Investment Partnership

Investment Strategy

Nick Sleep and Qais Zakaria crafted a unique investment strategy through their Nomad Investment Partnership, which they viewed as a laboratory for high-quality investing. Their approach was characterized by deep research, high concentration, and a disregard for conventional marketing, leading to a tenfold increase in their fund over 14 years 1. Nick's journey into finance was unconventional, having studied geology and geography before landing a job as an investment analyst. His unique perspective, shaped by books like "Zen and the Art of Motorcycle Maintenance," emphasized quality in every action 2.

You really want to do everything with quality, as that is where the satisfaction and peace is.

--- Nick Sleep

Their story, as detailed in William Green's book "Richer, Wiser, Happier," highlights the rewards of resisting instant gratification and maintaining independence in thought and action 1.

   

Long-Term Focus

Nick and Qais practiced intentional disconnection, focusing on long-term value by ignoring ephemeral market information. They believed in deep research and finding businesses with enduring qualities, asking questions about a company's long-term destination and management's role in achieving it 3. This approach allowed them to subcontract capital allocation decisions to exceptional managers, trusting them to grow the businesses over time 4.

We just read annual reports until we're blue in the face and visited every company we possibly could until we were sick of it.

--- Nick Sleep

Their method, termed "destination analysis," focused on understanding the long-term potential of investments, which they believed was key to achieving sustained success 3.

   

Strategic Shift

Initially, Nick and Qais pursued high-turnover investments, buying undervalued assets globally. However, they soon realized the limitations of this strategy and shifted towards holding higher-quality businesses for long-term compounding 5. This evolution was influenced by a costly mistake with Stagecoach, where they sold too early, missing out on greater gains 5.

I believe that good things grow.

--- Nick Sleep

Their investment philosophy matured into a simple game of buying a few well-researched stocks and holding them for years, avoiding leverage and speculative trading. This approach was encapsulated in their fund's name, Nomad, reflecting their willingness to roam in search of value 6.