- Disqualifiers
- Am I interested in learning more about the company?
- Important
- Is it in my circle of competence? Do I know the business model and the industry?
- Clear thesis (why do I think this company will be a good stock?)
- Moat
- Why is this company better than all the other competitors?
- Have you looked at the innovation decision tree?
- How do you think about future-proofing and optionality?
- What is the value proposition? How much value are they providing?
- What is the culture of the company like? How do they treat employees?
- Management
- Insider ownership and other smart investors?
- Founder led?
- Culture of innovation? Long term view?
- Financials
- Revenue growth, margin expansion, operating cash flow, ROIC
- Capital structure? Too much debt?
- Total addressable market? How well do they know the industry?
- Biases
- Do I like this just because I've spent a lot of time researching this?
- Do I like it just because it's down a lot from a high?
- Is this the absolute best choice I can make or am I de-worsifying?
- Am I seeking to find reasons to like this company rather than letting the facts speak?
- Valuation
- How confident am I in the assumptions to get to a 5 year 20% CAGR?
- Allocation
- What is my gut-level conviction and the upside potential?
- Pre-mortem: if this turns out to be a bad investment, what will be the reasons?
