One more thing I wanted to talk about in regards to the Chris Mayer + @DrewCohenMoney podcast is the distinction between capital allocators and operators ...

... and how incredibly rare it is to find someone exceptional at both!

Full stop.

This topic really struck a chord with me, especially when Mayer discussed the current tendency of operators to allocate millions or even billions toward AI-related tools, software, and infrastructure, simply because it’s "in vogue" and it's what business leaders are expected to do.

While it's true that technology, particularly AI, is becoming a central focus for businesses, the majority of companies spending aggressively on AI are unlikely to see satisfactory returns on those investments.

What Mayer highlighted, which again resonated deeply with me, is that these companies often fall into the trap of being led by good operators but poor capital allocators.

Most CEOs are experts at running day-to-day operations, but when it comes to capital allocation – whether for acquisitions or internal investments, like AI, and understanding what drives value, when buybacks create value, etc. – they might not have the same level of expertise.

This distinction is why Mayer feels particularly comfortable investing in companies like Constellation Software $CSU. He knows that the leadership at Constellation doesn’t just think about the day-to-day running of the business, but also – and primarily – about the RETURN on EVERY dollar they allocate!

Full stop.

Whether it's an acquisition or an investment in new AI capabilities, their focus remains on earning a solid return, which is exactly what makes them exceptional capital allocators.

This is the key takeaway: exceptional capital allocation is not just about being good at running a business; it’s about being disciplined and strategic with how capital is spent.

Everyone can get an acquisition done. Few can earn a satisfactory return on said acquisition.

Finding leaders who can excel at both is incredibly rare, but when you do, it’s often a recipe for sustained success as an investor.