Tuesday, April 29, 2008

Rare Insights!

Q: Take us through some of the investments that you have made while you have been with Rare.

A: As I see it, the company has an opportunity. You have to figure out how the company can position itself well enough to seize the opportunity.

Q: You are sort of looking at different sectors from hotels to media to lifescience companies. How do you sort of sit and figure out which sectors you want to maximise on or the companies that you want to maximise on? How do you actually spot an opportunity and how much of that is gut and instinct?

A: It is a little bit of analysis and a bit of instinct. A lot of decision-making is largely based on betting on the promoter's ability to seize the opportunity. So, the mental process that you go through is the same. The relative size of companies could vary. So, I guess the mental process is the same.

Q: How many of you actually huddle together and make that decision?

A: Three of us.

Q: Does it work like a debating society at that point? Is there one vote that reigns supreme?

A: Not really. There is a little bit of debate. Typically, we look for companies that have a large addressable opportunity and the rest of the things we document it and discuss it out point by point. So, it really doesn't take much time.

-Rajiv Agrawal, a Principal at Rare Enterprises.

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