The Official Pitch The PM Newsletter No. 3

Calendar:

Next Week:
- New Episode with the CEO of Hydra Host, a private GPU Inventory SaaS Company. Subscribe to YouTube episodes here.
- Pitch The PM’s Job Board & now direct to your inbox in the Newsletter. Sign-up now to never miss a new opportunity.

Later This Month:
- Apprentice Program Lesson 2 Wednesday, May 14th 11 AM ET. Join here (it’s free). - May 15, 2025: An Alpha Sense sponsored Webinar on ZM: A Stealth AI play - accelerating growth a catalyst. Register here.

Inside the Buy-Side - Blog No. 7

$100 Million for One PM: Hype or Justified?

Q: THIS IS GETTING NUTS, HOW IS ONE PERSON WORTH $100 MILLION?
A: Ha, yes, that is a big number. Congrats. 
COLOR: Business development teams at large multi-manager likely view these as M&A deals, just like buying a business. They evaluate what the historical cash flow has been and whether that can be repeated somewhere else. In this case, the research process was DIFFERENTIATED using investigative journalists as Analysts to do super deep research that focused on short selling (i.e. Hindenberg Research).

The market for needle moving PM’s is very small at the top. I suspect there was some value ascribed to the “only” one year non-compete. The industry has been moving to 1.5-2 year sit-outs, and then the process of building a team begins and the targeted Analysts could have sit-outs as well, so having a 1-2 year ramp time vs 3-4 years is valuable.

Let’s assume for simplicity it is $100 MM over 4 years or $25 MM/year (it might have other features like accelerated earn-outs or count as a draw to earn back, etc..). On $75B AUM, that’s 0.03% per year. It can be a pass through cost that the LP’s bear as part of the management fee depending on how it is arranged. If a great PM can make say $100 MM/year in PnL on a $25 MM investment that could be a 2.6x ROI to the LP’s. $100 MM of PnL could equate to $80 MM of net PnL after the team’s incentive pool of say 20% (assuming no accelerator) and then the GP typically gets 20% leaving $64 MM for the LP pool, or a 2.6x ROI. If the firm target is $7.5B or a 10% return for the LP’s, this would be 0.85% of the goal…

MY TWO CENTS: The headline seems like a lot, but the math makes sense to me. There are not a lot of needle moving deals to be done, and a one year non-compete is advantageous.

Q: DOES THIS SIGNAL A BIGGER SHIFT AT MILLENNIUM?
A: I am not sure. I only know what was in the press.
COLOR: Millennium has historically been decentralized; teams operate independently. Schurr ran a team & had responsibility for a centralized research function that focused on primary research. While I have not worked at BAM, I did have a friend in the central research team that was a very capable Analyst; he later left to become a PM elsewhere. I suspect the investment in high quality central research talent has been a contributing factor to BAM’s success and the appeal of Schurr.

MY TWO CENTS: This does not change the fabric of MLP. Instead Schurr has a ENTREPRENEURIAL runway to expand his own business.

Q: IS THIS DEAL BECAUSE OF THE YTD RESULTS?
A: Maybe. It could have been because of the recent divergent performance or it could have been in the works for a few quarters. Hard to know.
COLOR: Millennium was -2% in 1Q25 & BAM was +2.2% in 1Q’25.

MY TWO CENTS: I would surmise that a big investment is deeply diligenced and not spurred by a rare sell-off.

Upcoming Webinar: Is Zoom the Next Stealth AI Winner?

We’re hosting a Webinar with AlphaSense, the best AI Market Intelligence and Search Platform, to discuss our bullish view on Zoom!

We believe Zoom ($ZM) is at a true growth inflection point— and AI is the catalyst. The company’s made major strides beyond video calls, with deep investments into AI.

With the fall-out of the covid SMB Online segment revenue decline mostly behind the company, the higher quality Enterprise segment's growth acceleration is ready to drive the company's results. 

We’ll break down:
- How Zoom's AI Companion is changing meetings, messaging, and collaboration
- The major revenue drivers behind Zoom’s next phase: Phone, Contact Center, Workvivo
- Why Zoom’s growth slowdown may be turning — and how a re-rating could follow

To find out why we think Zoom’s growth is about to re-accelerate, register here to attend or receive a recording!

Pitch The PM Apprentice Program

Pitch The PM hosted our first Apprentice Program on Wednesday! We’re building a collaborative space for aspiring investors, current portfolio managers, and buy-side analysts who want to connect, learn, and refine their edge.

At this weeks 1 hour meeting, we discussed mental models on the Rate of Change in the investing process, and the importance of using checklists!

We have over 40 Apprentices already, ranging from Students to VP Research Analysts, all the way up to C-Suite— you can still join to learn more about buy-side investing!

Click the image below to join the group on LinkedIn and receive updates on future meetings!

Updates to Pitch The PM Job Board

Highlighting 3 Great Opportunities!

T. Rowe Price - Natural Resources/Energy Analyst
Eisler Capital - Metals & Mining Analyst
Barclays - AVP on a three person Industrial team

🎉 Congratulations to our friends at Seaport Research Partners for continuing to build-out a world-class research product— now expanding coverage in Technology Semis & Electronics with a strong new hire!🎉

📌4 New Job Opportunities:
- L/O Analyst (Natural Resources/Energy) - T. Rowe Price
- L/S Analyst (M&M) - Eisler
- SS Research AVP (Industrials/Machinery) - Barclays
- L/S Portfolio Factor Analyst (Quant)

🔍3 New Job Seekers:
- 1 years LO (Generalist)
- 3 years LO (Macro) with Python and SS experience
- 3 years L/S (TMT, Cons), Citadel Summer intern + P72 spin-out

🚨 We're launching a dedicated Job Board Newsletter!
Our job board is getting its own spotlight.

If you’re hiring, job hunting, or just want to stay plugged into the market, this is your go-to resource.
Register for Weekly Updates here.

Check out the most recent Job Board post with a comprehensive list of opportunities and candidates by clicking the image below!

Buy-Side Career Advice for First Timers:

Thinking about breaking into the buy-side?
Here’s what I wish someone had told me on Day 1.

I put together 17 quick lessons for anyone starting out— whether it’s your first investing role, you’re making a career pivot, or just trying to understand how things really work behind the scenes.

A few takeaways:
⚙️Process matters more than chasing short-term P&L
💬 Communicate more than you think you need to
⚠️Don’t let the screen price shake your conviction
🧠Use AI to improve productivity and cover more ground— not skip the work
🔥You are replaceable. Stay sharp. Stay humble. Come hungry everyday

This isn’t theory — it’s real talk from the desk.
👇 If you’re interested in more tips from the buy-side, read all 17 below!

NVDA: Amazing GPU Leadership. Corporate Governance Lagging?

While Nvidia’s GPUs lead the AI Revolution, the governance story is raising some flags behind the scenes.

A BIG thank you to ZMH Advisors for contributing to our NVDA research this year. I am a big fan of Waheed Hassan (CEO) and Michael Barham (Sr. MD). They’ve been my go-to team for any proxy, corporate governance, or activism issues that have come up throughout my career on the buy-side and corporate side. You can test drive their new ESG dashboard here to see how each company does on key issues: https://dashboard.zmhadvisors.com/

Board Tenure: An issue?
- 7/11 non-exec directors have served more than 10 years
- 3 directors have 30+ years
- Average board tenure: 14.8 years
- Entrenchment concerns called out in Nvidia’s 2024 proxy

Shareholders AGAINST VOTES substantial
- 8 of the top 20 shareholders holding 13.3% of shares voted against directors or exec pay in 2024
- Vanguard, State Street, and BlackRock among them
- Common flags: Supermajority voting rules, excessive tenure, weak board refresh

Executive Compensation
- CEO earned $34.2MM

Investor Comments Signal Improvement Needed
- Legal & General: “Fails pay-for-performance hurdle”
- Votes against due to lack of clawbacks, short vesting, and governance structure

Get the full 54-page deep dive on “What’s Priced-in Now?” Below:

Spotlighting One of Our Favorite Voices & Newsletters in the Industry:
Eric Rosen’s The Rosen Report

Former Credit PM at JPM and UBS, Eric brings a rare mix of sharp market insight, hard-earned perspective, and laugh-out-loud commentary.

Give his work a read here: The Rosen Report

About Us

Pitch The PM is the Professional Investor's Podcast that provides a deep-dive into a stock's investment case using the Variant View Investment Checklist. It is an open exploration of the research process in real time using high-conviction ideas from top PM’s and Analysts. Join the journey as Doug fills out his Buffett advised, 20-slot lifetime punch card. We learn and laugh together. 

The Variant View Investment Checklist is the process that combines:

• A decade of experience managing $1B at Citadel & Millennium, 

• Studying the great investors like Buffett, Munger, Lynch & Greenblatt, 

• and the latest AI tools to improve idea velocity, accuracy and conviction.

Westport Alpha Group is a family office consortium of like minded finance professionals. Individuals may engage in Special Purpose Vehicle’s (SPV’s), Separately Managed Accounts (SMA’s) or act as an Independent Sponsor for a private company or in a public company take-private. This is not a solicitation to sell/buy any security or engage in any services. This is not an attempt to form a group.

Pitch The PM is hosted by Doug Garber, a former Citadel Analyst and Millennium Senior Portfolio Manager. Doug was initially trained at Citadel by a former SAC/Point 72 Analyst who worked directly for Steve Cohen before becoming a PM at Citadel. Doug was ranked as a top five analyst while at Citadel’s Surveyor Capital and was the only one to receive that designation twice during his tenure. He managed a multi-sector, multi-strategy team at Millennium under Katahdin Capital. Prior to his buy-side career, Doug worked in sell-side equity research honing modeling and primary research skills. Doug is currently the CIO and DoR at the Westport Alpha Group.

Doug graduated from Tulane University with a BSM and Master of Finance. He was selected to participate in the Darwin Fenner Student Managed Endowment Fund that utilized quantitative factors to outperform its benchmark and be an Investment Research Manager in the Burkenroad Reports “Stocks Under Rocks” equity research program. Doug has a passion for iterating on the investment process and a quirky sense of humor. He lives in Westport, CT with his wife, Lexi, and three kids. When he is not reading a 10-K, you can find him coaching youth soccer, inverted on his yoga mat or on an eFoil looking for Zuck.

Disclaimer

Past performance is not indicative of future results. Neither Pitch The PM nor its author (s) guarantee any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment discussed in this material or on the show. Strategies or investments discussed may fluctuate in price or value. Investors may get back less than invested. Investments or strategies mentioned on this website or on the show may not be suitable for you. This material does not take into account your particular investment objectives, financial situation or needs and is not intended as recommendations appropriate for you. You must make an independent decision regarding investments or strategies mentioned on this letter, on the website or on the show. Before acting on information on this website, in this letter or on the show, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.

The author (s) of this report may have positions in the securities discussed. The positions may change at a future date and neither Pitch The PM nor any authors are under any obligation to update you. The information may not be accurate and you should do your own research.

This is for educational purposes only. This is not investment advice. Please contact your financial advisor to see what is suitable for you. Please see disclosures at PitchThePM.com