Bill Ackman: Investment Strategy, What the Market is Missing, How AI Breaks Businesses

The segment opens with a short introduction of Bill Ackman as a "legendary activist investor" and the founder and CEO of Pershing Square, followed by teaser lines about short positions, low multiples on high-quality businesses, and a "rebirth of the closed end investment company universe."

The conversation then turns to an earlier on-stage session with OpenAI's CFO. The transcript spells her name as "Zara" and later as "Sarah", and the question first calls her CEO before correcting to CFO. The response is that the session was "super impressed" and made the speaker "a lot more bullish on OpenAI." The exchange ends half-joking: one remark suggests she should be CEO of OpenAI and Sam should be chair, and another notes an unasked question about what it is like working with Sam.

The first substantive question asks whether the investment philosophy has moved away from entering and exiting activist positions toward permanent, long-term holdings. The answer names "business quality" as the biggest change: "Long term, durable, protected, non disruptable growth." A smaller, more liquid investor does not have to think that far ahead. A bigger, concentrated investor does, and over time learns that durable growth is "the most important factor."

The speaker says the activism has not faded but has moved: "more of it's on Twitter" than in the corporate setting. The reason given is a change in standing. The Wendy's story illustrates the early years. Wendy's owned Tim Hortons, and Tim Hortons was worth more than all of Wendy's. The plan was "buy Wendy's, spin off Tim Hortons, double our money." After buying 10% of the company, the speaker could not get the CEO to return calls. A Blackstone contact arranged for Steve Schwarzman to write a fairness opinion on Wendy's value after a spin-off. The opinion was filed publicly, and six weeks later Wendy's spun off Tim Hortons. The CEO, later fired, eventually called back to say thanks because of a large exit package.

Back then, being small and unknown meant conference presentations and CNBC appearances. Today, the speaker says, they know nearly every S&P 500 CEO "either directly or one person removed," and companies sometimes put out a tweet welcoming Pershing Square as a shareholder. "In the beginning, we had to bang down the door." The firm gets deeply involved where needed. In other holdings there is nothing to do but "just clap."

When asked whether this makes them a value-add investor, the answer adds a qualification: the best investments are ones where "you don't need to join the board and do anything." When an interviewer pushes back that mature businesses may need more help than startups, the reply describes what a large shareholder offers a public company. Markets and analysts are short-term, while a good business "is a forever thing," run on horizons of decades or at least three to five years. "How can you do that when someone's asking about the tax rate in the second quarter?" A big shareholder on the board lets management test ideas privately, or publicly back an initiative "even though it's gonna hurt earnings in the next few quarters."