ANALYSE THIS: Capicraft’s Drikus Combrinck
We analyse the founder of Capicraft Drikus Combrinck
If someone came to you tomorrow with R100m to invest in just one company, which would it be?
Berkshire Hathaway. With R100m you would most likely be thinking of preserving capital. Berkshire’s disciplined approach and diversified holdings will enable the company to last through the ages.
What’s the wisest thing you could tell your 20-year-old self that you didn’t know when you started out?
Using leverage and investing in higher-risk assets seldom produce higher returns.
Which talent would you most like to have?
I wish I had some musical talent.
What was your first job? And can you remember how much you were paid?
Before my final year at varsity I landed a part-time job at McGregor BFA as an analyst. I earned R13,000 a month over the December holidays. I still have the pay slip. I had to take a big haircut when I started full-time employment a year later.
If you could fix one thing in SA today, what would it be and how would you start doing that?
I would give the country a federal system of government. That would entail changing the electoral system by doing away with party politics — at least at municipal level. There would be independent representatives only. Taxes at municipal and provincial level would be used as credits against national taxes.
Who do you admire in the investment community, and why?
Michael J Mauboussin, because of his ability to articulate investment philosophy as a discipline by studying disciplines in other fields.
What’s the worst investment mistake you’ve made?
I’ve made many mistakes when buying, but by far the biggest investment mistakes occur when one is selling. Mine was selling Naspers at R200, only to buy it back much, much later.
What’s the best investment you’ve ever made? And how much of it was due to luck?
I bought Brait at about R20 when it went through a restructuring and bought Pep Stores. I sold when Brait sold Pep. It was a good decision because it was a seven-bagger. It was a great investment because it was by far the largest share in my portfolio.
How do you control your emotions when all you want to do is sell or buy a share, but you know you shouldn’t?
With selling I revisit the investment thesis and consider if I would be a buyer if I did not own the share at the moment. With buying I might initiate a small position which can be added to as I build conviction.
What is your greatest extravagance?
Books, old and new. You can’t let a good book pass you by.
Big Tech or old-fashioned industrial stalwart?
Neither; pigeonholing investments breeds biases.
SA or offshore?
Offshore — way more opportunities, way less risk.
Art, wine, rare books or cars?
Rare books; wine is for consumption.
Do you cycle?
No, I grew up riding horses. Don’t tell me you can bond with your bike like you can bond with a horse.
If you weren’t a fund manager, what would your dream job be?
Either agriculture or politics.
Do you think active managers have a future in a passive-investment world?
Absolutely; passive investment "free-rides" on the presence of active management.