Pieter Slegers: How did you grow Compounding Quality?

Pieter Slegers [00:00:00] When I was, I think, I was 15, maybe just turned 16, that I was reading a newsletter and investing newsletter. I thought, wow, it would be so cool if I could do this one day. But then after that, I thought, well, you can do something like that. It’s very ambitious and so on. And then I quit my job and I remember it really well.

One week later, I quit my job, right? I’m now at my home, alone in my home office. And I was like then now it needs to be good. Now it needs to succeed. I have no income. I don’t know anything about marketing. I don’t know anything about business. The only thing is that I love investing and I love to write a niche letter.

I write everything Warren Buffett has ever said and written so it’s 5000 pages and I’m 100% sure that it’s way better than any degree you can get at university, any MBA, any C of A study, any whatever experience in the fields. Just read what Warren Buffett has ever said. Everything he has ever said has been written and totally the best learning school can probably get.

Tilman Versch [00:01:10] Dear viewers of Good Investing Talks, it’s great to have you back and it’s great to welcome Pieter Sleger of Compounding Quality for the first time on this channel. And many of you know him already like he has an impressive following. Hundreds of thousands of people on X, a subsect with female 50,000 subscribers.

LinkedIn, where he has a big following and he might be one of the most followed investors in the long-term investing value investing bubble. Maybe outside of the two guys, he has behind him. They have acquired a bigger followership and today I want to learn with you how he built the brand Compounding Quality. So hi Pieter, it’s great to have you here.

Pieter Slegers [00:01:54] Hi. It’s an honour to be here, Tilman.

Tilman Versch [00:01:57] Thanks for joining us where you’re joining us from?

Pieter Slegers [00:02:00] I’m based in Belgium, basically near Antwerp, so 20 minutes drive from Antwerp, basically.

Tilman Versch [00:02:07] It might be a surprising fact for some because with this brand many think you will be based in New York or something like this but might get into this later. And let’s go to talk about Compounding Quality. When did you start with it?

Pieter Slegers [00:02:25] Yeah, sure. And before I answer your question, Tilman, I will just take a few seconds to generally thank you, because I think what you do with a Good Investing Community is amazing. You’re basically also, our thanks to you, I went to Omaha to the AGM the previous year 2023 and I think all the events you do there are great so.

Tilman didn’t ask me for this, but I would say well, anyone who wants to go to the AGM, well, Tilman is your person, so I’m genuinely thankful for that. And also as of now, well, I would go every year to the AGM and that’s mainly because of you. So thank you for that. And kudos to you for everything you do with the Good Investing, I would say. So to answer your question, while a Compounding Quality, I started Compounding Quality in the summer of 2022 and it’s actually a very funny story in the sense that.

Well, I think some people might have heard this, but I used to work in the industry. But I also basically love to share my thoughts about the stock market on social media, Twitter and Dutch. So I’m from Belgium. But then my employer came to me and he basically said to me you didn’t put it that way, but that was the message well. Just tweet about the company and for addressed don’t share your thoughts about the stock markets, so that annoyed me.

That bothered me a bit. And then on a Friday evening or I remember it really well, I lived with my girlfriend on a hill, which is a small town in Belgium and that Friday evening I was staying at my parents’ house. Why? I had a bachelor party for one of my best friends. And it was in the neighbourhood of my parents’ house. So I decided to stay the night there and then on Saturday, we did a bachelor party.

So basically that’s Friday evening. I was a bit bored and the site. Let’s just make a Twitter account. So went to Twitter, or I should say X nowadays, right? But went to Twitter back registered it and then created an account. Well, the name had no clue. Thought for 30 seconds. Well, let’s say I’m a big fan of quality investing. So let’s take Compounding Quality compound interest and then quality investing. OK, the next step on the Twitter registration process.

An image then was a problem for me because I couldn’t take my real face because I wanted to do it anonymously. So I could say what I wanted to say without my employer getting bothered. And this is maybe also something we can talk about. While I chose to. Obviously, Warren Buffett is your big idol, so I chose to use a cartoon image of Warren Buffett with a red background. And that says, basically the account was created. Created and maybe also to elaborate a bit on that. I think many people have said that like Bill Gates and so on.

I would also say regarding Compounding Quality, probably the successes 70 to 80% luck and 20% maybe because of what you actually do and to make that more concrete. So I created the account Compounding Quality. I spent quite some time on it in the first two weeks and basically, it didn’t get any traction, so maybe 20-30 followers after two weeks and I’m posting every day. And then I said something to myself, like, well, I will give this one more week, and if it still doesn’t work out, I’ll just focus on my job.

I’ll go do something else and then basically one thing or one tweet changes everything and that was that Gautam Baid, the author of The Joys of Compounding which many of you will probably know. He quoted, and retweeted some tweets. And I said, well, this is actually quite good as a can’t give it a follow and since then. Yeah, the account exploded that day and since then, well, it has been quite a linear process and it has been so much fun I think indeed today the count has something like 430,000 followers on X. So it’s a lot of fun to have been able to do this, and I’m very grateful for this as well.

Tilman Versch [00:06:51] Yeah. The thing with Warren Buffett is I think he has a lot of like, he’s, I often use this picture. He has a big crocodile and he has a lot of cleaning birds that jump above him, clean him and they also profit from the synthesis with him. There are a lot of guys who got a career boost while hanging out with him, like guys VM Monish Pabrai. And also a lot of other people who go to the AGM and build like expertise around it and build things around it.

Pieter Slegers [00:07:22] And to be honest, the same is with me. So for example, some people might know it, so the Warren Buffet logo I used but I just created the account on a Friday evening like I mentioned, but obviously it was just for fun. I had no clue that Compounding Quality would become so popular.

And then obviously after a while, you said, OK, maybe I should change this icon. I should change the Warren Buffett logo because yeah, maybe it’s just. I got an e-mail from Charlie Munger’s firm, Munger, Tolles, & Olson saying some people think that while Buffett is involved here, please can you change the picture which was on the one hand, obviously it’s a big compliment and obviously Warren Buffett is not involved. I’m .0001% as good as Buffett probably on the other hand, well, it’s scary. But I didn’t want to change the image or the logo before.

Why? After a while, the logo became so iconic in some way that I just wanted to keep it, but obviously changing it was the right thing to do. And as you mentioned for a lot of people, Warren Buffett is a big example. And I think if everyone could be a bit more like Buffett, well the world would be a healthier, wealthier place. So last year I also spent reading. I read everything Warren Buffett has ever said and written.

So it’s 5000 pages and I’m 100% sure that it’s way better than any degree you can get at university, any MBA, any C of A study, any whatever experience in the fields, just to read what Warren Buffett has ever said, everything he has ever said and written and that will be the best learning school you can probably get.

Tilman Versch [00:09:10] And he’s a global household name in some effect for investing and investing is quite a faceless thing, so adding the face of Warren Buffett is like kind of the thing that gets people’s attention and draws them in. And he has this trustworthy brand. It’s a bit like Apple from the brand positioning he has in the world of finance, which is super interesting to see.

Pieter Slegers [00:09:37] Absolutely, absolutely.

Tilman Versch [00:09:40] And going back to your brand. Were there other, like game-changing moments outside of the retreat of Gautam Bate? Thank you for this, Gautam.

Pieter Slegers [00:09:53] Yes, exactly. So also indeed. And I met Gautam last year at the Berkshire AGM or the day before, we had Tilman together. He is an amazing person, really catch, really down to Earth, so really grateful for him. Another big moment for me was when Bill Ackman engaged in some tweets of me sharing things about Buffett and so on.

But I think in general, that’s what I always said. Well, when I was a kid, I always wanted to become a teacher, and obviously, you also had a passion for investing in the stock market. And I always say that, well, right now you’re doing both. So on the one hand, you’re following your passion for investing, following the market 24/7. On the other hand, I think social media is also a big way of teaching. In hindsight, maybe where I was quote-unquote lucky as well is the first year I run Compounding Quality.

I was still working full-time. I was still doing everything anonymously obviously. And just the fact that you kept on giving and trying to provide as much value as you possibly could without asking for anything in return. Well, I tweeted for one year I had written something like 150 articles just freely available. More general content about the stock market and so on. That helps a lot, I guess. It’s like the flywheel effect of Amazon or what Chief Beezles has done with Amazon because you give, give, give.

Well, that’s the essence also of social media, I guess try to provide as much value as you can. And on top of that, maybe what’s another really important one I guess is just to be attending, be yourself. For example, some people will want to do something in social media here when you create a threat or a post on Fiat ChatGPT or any other AI tool.

People can feel that. People can sense that everyone is unique and just by being yourself, by doing what you generally think is the right thing to do. People can feel that and that makes a huge difference as well the authenticity and having that is really, really important there.

Tilman Versch [00:12:16] What is impressive about you is the persistence and the stamina you put into putting out content, working through things, but it seems a bit like you found your calling in this job, so you’re a passionate investor, but you’re marrying it with this teacher, you always wanted to be from your childhood. Could you describe it a bit?

Pieter Slegers [00:12:39] Yeah, exactly. I feel like I’m the luckiest person in the world, in the sense that while one, I have had the opportunity to follow my passion and make a living from that. Am I two big passions are indeed on the one hand, teaching, on the other hand, yeah, the stock market. And I’ve always, I’ve also always said when I would do something completely different.

So when one day I wouldn’t do anything in the stock market or investments, it would definitely be teaching. So indeed combining those two things is probably the most fun part, and you also see that with other people like Brian Feroldi for example, is also amazing. I think he also has some kind of teaching background and you see that with plenty of people.

So I also think, by the way, maybe to elaborate a bit on that for social media, but also for the newsletter and so on. I think the key goal should be to explain complex problems as easily as you can. When you can, for example, you can explain the reverse DCF or the importance of return on invested capital. Just saying something in a way that a 12-year-old can understand it. Well, I think that’s the big difficulty of the content creation game, to put it that way.

But it’s also when you succeed in that well, it’s amazing. So probably the best right and finance and investing is Morgan Housel, right? I think when you would give his articles, give his books to your 14-year-old niece and she doesn’t know anything about investing or the stock market or finance. She will be able to understand what Morgan Housel is saying and that’s beautiful. So yeah, also, Morgan Housel is probably someone I really, really look up to.

Tilman Versch [00:14:33] So these are also your role models somehow.

Pieter Slegers [00:14:37] Absolutely.

Tilman Versch [00:14:37] Kind of become peers with them after two years.

Pieter Slegers [00:14:43] I wouldn’t put it that but it’s amazing to learn from other people. That’s also the big advantage of the world we live in today, right? The big advantage of the 21st century, there are plenty of books. There are plenty of things available online, even or often for free that you can learn from the best in the field free.

So for example, I’ve done that. I’ve printed out everything Morgan Housel has written as well. So just all these articles and so on. I read blog posts that are so, so valuable I can learn so much. As Munger said, I think you should be a lifelong learner and I’ve set the ambitious goal to reach 52 books a year for the next 52 years.

I think that’s a lovely goal to aim for. I think right now this morning I started reading my 80th book of the year. So it’s November 2024 for those who are listening a bit later. And I think just doing that and learning from the best investors in the world, learning from the best businessman in the world, learning from the best writers in the world, that’s so, so valuable.

Tilman Versch [00:16:30] So how does a day and the week look like for you? Is it more like I would think of like you’re a monk, waking up in the morning, drinking tea and then reading, reading, reading and then two hours on social media and then reading, reading again?

Pieter Slegers [00:16:42] If you replace tea with coffee, you’re pretty accurate to be honest, I try to keep my day very, very structured, in general. Just because you have two books, I really love deep work and I eat at Frog just about productivity and the key message basically is, well, two hours of undistracted work will deliver you more output than what most people achieve in a traditional 8-hour work day. So actually I try to live by that statement.

The key message basically is, well, two hours of undistracted work will deliver you more output than what most people achieve in a traditional 8-hour work day. So actually I try to live by that statement.

How does my day look every day? Well, I try to do it to live every day exactly the same. Obviously, in practice, that doesn’t work every day, but usually, I wake up five minutes before 5:00 AM, go to the toilet, brush my teeth, and grab a coffee. And at 5:00 AM at my desk, usually read a book. So every day between 5:00 AM and 7:00 AM I read a book. Hence the 80 books I read so far this year.

Tilman Versch [00:17:48] Do you read them in hardcopy or do you have an eBook reader?

Pieter Slegers [00:17:53] I read them a physical book, so hardcopy. Reading for that is I’m already 12 hours a day behind my laptop. So this is one of the only times of the day that I can spend without my laptop and I also love to build a huge personal library over time. I think that’s also some of my goals that would be really, really cool in general.

So I spent quite some money on books. That’s true, but it’s an investment in yourself and we both know that that’s always the best investment, right? So yeah, 5:00 AM to 7:00 AM is always reading. 7:00 AM until 8:30. I read a 10K or an annual report every day. 8:30 till 9 is usually well, I have some breakfast and so on. I catch up with my girlfriends right now. 9:00 AM until 12 is usually just indeed analysing stocks.

So analysing when a company within a portfolio publish results. Just finding new companies. Writing an investment case about a company, and so on. So then it’s noon until 1:00 PM, and I try to go for a run. I should confess that this year I didn’t run as much as I used to run just because also what’s happening with Compound Quality and everything around it. But I try to do that also during the run, listening to a podcast.

I think you have a lot of excellent podcasts. Once again about business, about investing, about writing, and so on. After lunch, well also still the same. Basically, 1:00 to 2:00 PM writing for the newsletter and analysing stocks and then 2:00 to 4:00, it’s more like social media. Answering emails and so on.

And this is also quite an exception, Tilman, because the internal rule I have for myself is that usually, once again, doesn’t work all the time. It’s usually I don’t do meetings before 4:00 PM. What’s the reason for that? Also, because I’ve been working from 5:00 AM till 4:00 PM. Well, that’s all almost a full day.

My brain is a bit foggy, already cooked. And that’s when I tried to do some more light work, like some meetings, like other things around the business and that’s how it’s usually worked for me. Obviously, we are both based in Europe and when we want to do meetings in the US obviously that’s most of the time late afternoon for us or in the evening.

So this structure works really well for me. In the end, I tried to structure my day as much as possible just about keeping productivity high, and learning as much as I possibly can, and also obviously depends on whether you are a morning person, a night person, or an evening person. For me, it’s definitely, I’m a morning person. For some people, that also sounds weird.

So you’re a morning person, you are the most productive in the first hours of the day, right? You spent the first hours of the day reading and not writing investment cases or analysing stocks. You could say something about that, but I feel like I’m about to turn 28 right now. We need to be lifelong learners and I think that I have the moral.

Yeah, and just the only thing, well, I’m obliged towards my readers, and subscribers to keep learning and keep learning new things keep improving as a person, as an investor and so on. And that’s why I just do it first thing in the morning then it’s done. I can’t skip the reading just before because something else came up during the day and to me, the structure works really well, in general.

Tilman Versch [00:22:00] One recommendation I would maybe try to do the run without the podcast. And just focus on running and being in nature. I’m experimenting with this as well because I have my mid-day walks. I’m an old guy and doing them without any input is regenerating and then you’re more productive afterwards. Give it a try. Let me see what you think.

Pieter Slegers [00:22:24] Exactly. I tried it many times, but probably the problem quote-unquote on average is that I’m obsessed with productivity and learning, so to also to give you an example, yesterday I ran half a marathon, it was a local event here in some local city I live in, and after 1:00 PM my headphones broke down and I was even during the event, which was an official race, I was listening to a podcast about investing and it frustrated me so much that I needed to run for another 20 km went out without listening to anything, but I think it can work as well and exactly true when are the best ideas arriving to you is always when you are going for a walk when you go for a run, during the shower and so on.

So obviously that’s also very important in general. You need to laugh at what you do and you need to have a healthy mind plus a healthy body. Obviously, that’s a cliche, but it works that way because when you are struggling with something yourself, I think it would harm the quality of the ideas you have a lot.

Tilman Versch [00:23:36] It’s helpful to keep yourself up and loving yourself a lot when you want to give to others. Because otherwise, you can’t do it consistently and persistently, which is also important. Maybe let’s go back to the history part. So you had already mentioned you were one year in giving, giving and building this snowball or this flywheel, if you want to call it that. When did you become clearer that this could be a business and when how did you start out to experiment with revenue sources?

Pieter Slegers [00:24:17] So basically, well, initially it just starts for fun. What is actually really funny is that and I recall that moment when I think was 15, maybe just turned 16, I was reading a newsletter, an investing newsletter.

I thought, wow, it would be so cool if I could do this one day, but then after that I thought, well, you can’t do something like that. It’s very ambitious and so on and hence here we are. So that’s beautiful. Well, regarding so yeah, can’t start in June 2023. And I quit my job during the summer of 20. I’m sorry. The account started in June 2022 and I quit my job during the summer of 2023. What happened to me or what was the case for me contractually from my employer back then, I wasn’t allowed to earn anything outside of my job in the finance industry.

So basically never try to monetize anything before I quit. So it didn’t do paid subscriptions. I didn’t do advertisements just earnings were 0.0. It was even a loss because I invested some things in the business like buying a domain name for your website and so on.

Why or what gave you the courage to quit your job back then? Well, obviously you can look up some things and network with other people. And I knew that when I quit my job. I would basically make double the money I made from a regular job, just by putting advertisements on the newsletter.

So I probably was also quite conservative in that and waited quite long before actually taking the jump, but that’s also maybe something, yeah, I think when you have news that you can monetize mainly in two ways. One is indeed the advertisements and two is to have a paid subscription in place. I think to me it made not a lot of sense to use advertisements. Why? Those people that are on your websites, come to your website because of you because they liked you or they liked your content. They liked what you had to say and so on.

And then when you do an advertisement, well, you are basically pushing the people that came for you away to other channels. Again, when you have a paid subscription, well, they come to you and you keep them with you, but they get something extra and they pay for that. So I chose or I did choose to take that route and I am able to pay a subscription for Compounding Quality.

So before I quit my job, all content on the website and social media was 100% general and educational, and with that, I mean just general thoughts about the stock market, how to think about growth, and how Buffett built his empire. What are famous investors buying and selling right now?

What changed when I quit my job as I started to implement a portfolio of Compounding Quality, an ETF portfolio that was a community investment case. So when I buy a stock around a 40 to 50-page deep dive about it. So then it got more into the stock-picking work basically.

So that’s what happened there. I think for people who don’t have the limitations for their job that they could, monetize a newsletter earlier when they are doing that, I think most people recommend turning on a paywall or whatever do advertisements just to see whether this is something feasible or not, because we also need to be honest with each other, I’m using Substack right now, but I think when you look at the leaderboard.

There are a lot of people who are writing investment-related content and subtext. But I think there are very, very few people who are able to make a living from that. I should be grateful for that. I think intensity is really important on the one hand. The second point is probably, indeed, the simplicity to try and explain complex topics in a really easy way.

I think those are probably the most important things and maybe on top of that, like you already briefly touched upon the consistency that people know what you expect from you every, just saying something every Tuesday and every Thursday you get an article from me or another frequency.

But when you would, for example, say I’m going to do a newsletter and sometimes I have a lot of time and then that month I publish six articles and then December’s really busy for me and I don’t publish anything. And then January is your OK and I publish three articles and a month after whatever ten articles, something like that. I don’t think it would work really well, so just the consistency is indeed also a very important pillar.

Tilman Versch [00:29:24] Yeah, it’s super helpful to be consistent with this, but it’s also super hard to keep this up depending on the content formats you produce. So you have to find something that’s repeatable and in this sense scalable as a content format.

Pieter Slegers [00:29:38] Yeah, exactly. And that’s also something it’s a flywheel that never stops. Meaning when you want, when you go on a business trip for a week, when you want to take a holiday for a week that’s good.

But in the end, I made a commitment to publish every Tuesday, Thursday and Sunday. The articles need to be there and they need to be good, so it never stops and nobody cares whether you went on a week business trip and were stuck in the airport for 24 hours and can’t make it or something like that.

The content and the investment cases need to be there, so it’s a flywheel that never stops. And I think that’s probably the biggest challenge of what I’m doing right now, I know quite some people and I won’t name names who Have had a really difficult time personally in terms of just the constant pressure fighting burnout and so on because it’s a flywheel that never stops. So that’s an important thing to take into account for example.

So one may be to elaborate on that as well. I love the newsletter, don’t get me wrong, I love all the people involved there. I love to do it. But basically, when people ask me this question, do you want to write a newsletter today? Absolutely. Do you want to write a newsletter next year? Yes. Three years? Yes. Five years? Yes. 10 years. I don’t know. 20 years, probably not.

And with that, I mean, when you could choose between writing a newsletter and doing an investment fund, for example. I guess when you’ve done this for multiple years, for a few decades, maybe, then the fun business is quote-unquote, I’m sure that some people or a lot of people won’t agree with me, it’s more of a chill business and maybe that I’m mispronouncing myself here, but just because it’s not a flywheel that keeps on running and when you have an investment fund like your investment portfolio.

You have built your positions and you go to the US for one week, next week just to talk with some, with the management of some companies you own or to network and so on or to go to the Berkshire AGM, you are learning and you’re working for your business and the same is true in the newsletter business.

But in the newsletter business, your content needs to be there as well. Well, in the fund management business, it’s just about like, Buffett said, if you have one or two great ideas a year, you’re doing really well, right? While in the new software business, you need to write three articles a week, meaning 150 or a bit more a year. The content needs to keep running and as it continues flywheel.

Tilman Versch [00:32:42] You have this entertainment component. I call it like that. You have to entertain people and entertain them consistently. And this is really hard for me. That’s why I also gravitated away a bit from content focusing on other spaces because it’s like it’s something where you have to put in energy again and again and again, and it has to be your calling to a certain extent.

Pieter Slegers [00:33:09] Yeah, absolutely. I think when you don’t love this, you won’t pursue basically. I’m sure, and that’s the case in everything in life, right? If you love what you’re doing, you never have to work a day in your life.

I think that’s really important and also just the fact that you are giving back the fact that you are helping other people, the fact that you are making them hopefully a better investor, to me that’s a beautiful thing. And then live, it’s all about finding purpose and for some people that’s an investment newsletter for other people, that’s something completely different.

But finding it for yourself, I think, when you can find something like that for yourself, you’re really lucky and just go for your dreams and then try to provide as much value as you can.

Tilman Versch [00:34:02] And you also made it clever to a certain aspect. There is a certain duty and a certain pressure you have, but you integrate it in the way that it became your life over the last two years.

Pieter Slegers [00:34:12] Yeah. True. And that’s maybe also something funny or something I can share with Compounding Quality. When it started, I was just having fun. I was just tweeting on Twitter. Nowadays, and also on LinkedIn, I am writing the newsletter. I was just having fun. No stress. I loved what I was doing.

And then I quit my job and I remember it really well. One week later, I quit my job, right? I’m now at my home, alone in my home office. And I was like, damn. Now it needs to be good. Now it needs to succeed. I have no income. I don’t know anything about marketing. I don’t know anything about business.

The only thing is that I love investing and I love to write a newsletter. To me, that also gave some stressful moments like you need to promise or keep your promises and continue to do well. Well, luckily, I got over that after a few weeks, but that’s also something that probably sounds really like some people can kind of relate to what I’m saying right now.

But the fact that you just love what you’re doing, it’s fun. And also for me, it’s basically funny. Right now I’m writing, right? I’m writing the newsletter. When I was a child I was 10, 11, 12 years old. I was always the worst writer of the entire class when you to a short story or a summary about something. I always got a 5 out of 10, so just be above the threshold, which is really bad when you’re in secondary school.

Normally get 7 or 8 out of 10 and I got a 5. So that’s funny. You can keep exploring. When you are actually having fun, people can just sense it. People can feel it in your writing and be your own unique self. I think that will only become more important with all the AI tools we have nowadays.

Tilman Versch [00:36:18] Yeah, it really helps also to connect and grow your inner child in a certain way that you’re aligned with these tasks you have. Let’s try to go back to Summer 2022. And think of yourself and this time. Where did you get better since then, which are the areas you saw yourself improving and growing?

Pieter Slegers [00:36:47] Sounds cocky and isn’t that meant that may matter? Just I think he improved in, everything on the investment side and in the writing side and so on. And as I mentioned, that’s also, for example, this is an honest confession. I’m going to make it here as well. So June 22, I created the account and then in the summer of 2023, one year later, I quit my job. During the first year when I was still working, I was just having fun. I’m reading a lot learning a lot, all investments related, reading everything of Buffett, reading everything of Munger, reading everything of Francois Rochon and so on and so on.

Then 2023, I quit my job. And then I had a stressful moment like, I don’t know anything about business. I don’t know anything about marketing. Right. So that’s also when I try to learn a lot about all the other aspects of business, about marketing and so on. For example, in Belgium. So I live in Belgium and we speak Dutch. It’s the same language as what they speak in the Netherlands. I have a friend here who doesn’t live too far away, who writes in Dutch, which is about investing, which is a really small market and is doing over 1,000,000 in ARR.

In annual recurring revenue. Every single year, which is really exceptional because it’s in Dutch, the market is really small. Well, what’s the reason for that if you ask me? In the newsletter space, there are a lot of people in general. Let’s put it even more broadly. In general, there are a lot of people who are great investors. Then you have another pool of people who are great entrepreneurs, great business people, and then you have a 3rd pool of people who are great writers, great marketers and so on and so forth. But basically, what is very rare is that you are at least a reasonable investor, a reasonable entrepreneur, and a reasonable writer, slash marketer, and combine those 3 when you can do a bit of the three, a bit of all.

I think that’s very important in what we are doing right here. So also over the past few years. I’ve read a lot of business books. I’ve read a lot of books about storytelling. I’ve read a lot of books about marketing writing and so on. So for example, you have a book on writing from Stephen King. I think that’s phenomenal. He’s one of the best fiction writers in the world, right?

Just having the privilege to learn from something like that, I don’t know what the book costs 15, 20, or 30 USD/EURO. That’s just amazing. It’s the same as what Charlie Munger once said, well, there are answers for billions of dollars in a $30 history book. I think that’s truly amazing. And when you achieve in reading 52 books in the next 52 years, your friends over 2500 books I think you can’t help but become very knowledgeable, hopefully become very good at what you’re doing. And when you combine that with the fact that you love what you are doing, I think that’s very powerful.

Tilman Versch [00:40:21] When you went in 2023 also experienced this all in effect? So once you’re not in between positions like having one job and making this a side hustle things change and you get more focused and more and more things open up as you step this pathway more and more?

Pieter Slegers [00:40:44] Yeah, I think two things before I quit my job, I felt like sometimes I was leading a double life or something like that. So for example, we met in Omaha, right? And in 2023, I did a lot of meetings and so on the Compounding Quality. But also for example, and that’s a funny story. So I had a reservation with Gautam Baids to go have dinner at the restaurants the day before the Berkshire AGM.

But that morning, my former employer also mentioned to me well, the Prime Minister of Belgium is also in Omaha to attend the Berkshire AGM. So you should meet him here, give him a text and grab a coffee and so on. So OK, that morning I texted him. Look, I’m also in Omaha. Let’s have a coffee. On Sunday, after the Markel meeting with the Prime Minister of Belgium. OK. He agreed to. We agreed to have coffee and so on, and then that Friday evening I was waiting outside the restaurant to meet Gautam Baid.

And I said to him because I was still anonymous. I said to him, well, I will wait outside. I’m wearing a blue suit, blah blah. Because yeah, otherwise you won’t recognise me, right? He didn’t know what I looked like. So I was waiting for go time outside of the restaurant. Yeah. Woo arrived at the driveway. The Prime Minister of Belgium. And I said, oh, God. So I was waiting there outside. He did some small talk.

And I was like, no, please, can you go inside as fast as possible because I have an appointment with Gautam and he will be here in a few minutes and I can say to you that I’m Pieter, which is my real name and to Gautam that I’m Compounding Quality. So before I quit my job, sometimes I had a huge feeling that I was leading a double life.

And then I quit my job, right? Summer of 2023. And I had a feeling like I’ve been running the newsletter or writing the newsletter while working full time and I worked something like 60 hours a week for my regular job. So I thought, well, when I quit my job I will have so much time I can analyse so many companies I can read so many 10Ks. There are extra 60 hours a week that are available right now.

In Amsterdam, the top is very naive because so many things are happening at the same time and things you need to take care of during meetings and everything that is related to running a solo business basically from back office to answering emails to accounting, to you name it. So that’s something to take into account probably as well, but, in general, it has been a lot of fun for me. As we already discussed. Just structuring my day every day helps me to increase my output tremendously, or at least I have the feeling that that’s the case.

Tilman Versch [00:44:05] Yeah, this energy of a double life. I also had this working in politics part-time and then building investing, which is also two different worlds. But I could say who I am in both worlds but not fully. I know that feeling.

Pieter Slegers [00:44:19] I’m happy that phase is over for me as well. Sometimes it was quite stressful to live that way.

Tilman Versch [00:44:27] But when you started out, you said you were in parts a bit naked, not having marketing or business skills.

Pieter Slegers [00:44:34] Yeah, exactly, exactly.

Tilman Versch [00:44:36] Which kind of clothes did you then get overtime? Like ideas, and concepts from others. What helped you to build the skills and what was like maybe a few strongly impressive concepts that resonated with you?

Pieter Slegers [00:44:56] I think 2 things are very important. On the one hand, just the books I’m reading. That’s really important and also managed to provide. I’m a shameless copycat, but especially when you start out, you don’t need to reinvent the wheel. You can look at what other people are doing.

People who are 10 or 20 years ahead of you are doing and try to replicate that a bit. So just look at what some for example someone who was very successful can be an investing, but maybe FBNA or productivity doesn’t matter that much. Just look at what someone who was very successful is doing and try to replicate it for your own niche. For us in the invest investment field. I think that’s really, really powerful.

And what’s also it’s like you when you start investing, when you start a business, you will make mistakes, no doubt about that. But it’s just listening to other people what they have been doing. And trying to replicate it in a successful way is really important also, to be honest, what helped me really hard over the past few years is I have a lot of great mentors in my life and try to find someone like that just who has been doing this for multiple years like the Belgian guy I talked about was doing 1,000,000 ARR for 20 years straight.

Well, when you have the ability to send him a message and say look, Martin is his name, well, Martin, I’m thinking about doing this and that in my business. What do you think? And to get his opinion? And his insight is really powerful.

And also, by the way, you met him last year. I guess. I think, Chris. So Go To Value was also an alter to Seeking Alpha. We talk every single day. Same for him. He started them not sure 2018 or 2019 I guess. He has gone through the bulls and busts of the business, so having his opinion as well, well that’s really valuable. So I would really recommend everyone to try and find a great mentor and do that and you would be surprised about how many people say yes.

Also, one thing for example looking to do over the next few weeks is I live in a small city in Belgium you already know by now to just invite a quarter of the best entrepreneurs in the neighbourhood for dinner. I will pay for everything and we just discuss ideas and I can discuss some ideas I have for my business and then you can say, for example, one person I will invite is some kind of they basically built some kind of mini-Berkshire private equity company with 1 billion in AUM.

It’s a 10-minute drive even by bicycle from here. And then you can ask the question, why would a person like that chat with someone like me? Why would he attend a restaurant meeting when you invite him. Well, honest answer. He won’t come to that restaurant meeting for me. But when you’re in, when you invite three or four other people who are really, really successful here in the neighbourhood, we have, for example, also built a business of whatever 500 million or 7 million in a completely different niche.

He will come and when you tell another person that another billionaire will come, well, that he will also come. And that’s basically how you build some kind of internal audit committee which can be really, really powerful. You’ll pay for the restaurant. Everyone is happy. Everyone has a fun time. The other people, well, they look up to the other attendees and I think that’s something really smart to do. And that taking that restaurant bill is probably one of the best investments you can make for your general career, your thoughts, and so on.

Tilman Versch [00:49:03] I guess you’re underselling yourself a bit with this reach, but that’s just my take here.

Pieter Slegers [00:49:08] I don’t know I know. I feel, and I think that’s really important, to just be really, really down to Earth and that’s one I think I’m a very have a lot of empathy for everyone, but one thing I really, really don’t like in people and people I don’t want to engage with is people who are very arrogant. I think you should be investing, but also just in general, be down to Earth, be yourself, and have respect for everyone.

That’s really important. So for example, a month ago I was at we were doing for the newspaper, we are doing some interviews and so on at the head office of the newspaper here in Belgium and there is some guy, and once again I won’t name names, was really successful really well-known. But obviously, when he’s on TV, when he writes a column and so on, it’s really friendly, really empathic and so on.

But then you see how he treated the people who couldn’t do anything for him at the office of the newspaper back there and how he treated the people who needed to take care of his IT issues or bring him some drinks and so on in a very unrespectful way. And then you just for me personally, you lose all my respect. To be very arrogant against people who can’t mean anything to you directly, I think that tells a lot about your personality and that’s the last thing I would want to become myself, and also for me, the followers on social media, the readers on the e-mail newsletters.

They are just numbers on the screen and I don’t try to think that much about it, I think it’s a great idea to write every piece you write just with one person in your mind, whether it’s your 14-year-old niece, whether it’s Warren Buffett and think and act that way. I think that’s the way you should go with it.

Tilman Versch [00:51:21] Maybe let’s also try to look back and we already touched a bit on this. And that you seem to be also an experimental guy, but we haven’t worked this out really that much. We had this one conversation where you’re talking that you’re trying to throw as spaghetti at the wall and look what sticks. With this, you’re trying out a lot of things, but maybe let’s also talk about the things that did not work since you started out. So what are things you tried that were not successful to say it like this and with exclamation marks?

Pieter Slegers [00:51:58] It’s a good question. It’s a difficult question to start with. You have some kind of book series from strategic, which is how to test business ideas and so on. They are excellent. And I also think that’s one of the beautiful things about social media and newsletters and so on. You can indeed throw spaghetti against the wall really quickly.

See what works and see what doesn’t work so you can test things really quickly. That’s also what makes me a bit resistant about launching an equity fund. With a newsletter, you can test something. It doesn’t work. OK. It took one hour of time and I lost 100 USD slash euro. But anyway, when you launch an equity fund and it doesn’t work well, you’ve probably lost a few 100,000 dollars.

And you can’t go back immediately. So that’s what I like about the newsletter. To answer your question, what didn’t succeed? It’s a difficult question. I don’t think I have a straight answer. I think it’s just really important to be unique and be yourself. For me, Compounding Quality has always been around educational content. When I would publish right now a meme about the stock market or something about crypto or something about value investing or something else that just doesn’t work.

So that’s something I noticed. Another thing I noticed is that I recently launched two new newsletters. One is just a Dutch version of Compounding Quality because of the traditional media exposure you have here weekly column and so on. And then the largest newspaper. And another one on dividends where TJ Josh is doing excellent work. It didn’t work out as well as I would have expected. So that’s a big lesson for me as well. Not everything succeeds, and sometimes you will fail and I think that’s for everyone in the business.

Well, most of the best entrepreneurs when they’ve done 10, when I’ve launched 10 businesses or 10 business ideas, usually only two of them succeed and the same for the book, by the way. So I worked together with Luke la Cruz, a great friend, on The Art of Quality Investing. He did 99% of the work, meaning the book was already there in Dutch.

We hired someone to translate it into English and update a book here and there. Two things. One, I was surprised at how much work it was even when look and a translator did, 99% of the work, so I can’t imagine how much work a book writing a book from scratch. By the way, I think Simon Colt also just published a great book about quality investing. So a lot of work. The second point, I was a bit disappointed with the book sale so far.

So that’s also has been a disappointment. But once again because when for example, I would have written the book from scratch myself and spent weeks or even months of writing that it wouldn’t be a success. I would be really disappointed. Now the damage is a bit smaller because we work together on it.

So that’s a bit about, I think in the end it’s all about testing ideas testing quickly failing quickly and if it works well, bet heavily. I think that’s a great way to go about those ideas and the books from strategiser. Well, they help me tremendously with that. So in the end, it’s all about keep learning, keep improving learn from books and learn from other people. That’s probably the most valuable lesson I’ve learned over the past few months.

Tilman Versch [00:55:53] Like you had this kind of coming out moment when you turned from the Buffett logo to Pieter. What was it like from the perception that you’re a guy from Belgium, not an American Idol? What did it change? How did people react to this? And you’re also quite young. Some people could have thought you’re already in your 40s or something like that?

Pieter Slegers [00:56:21] I must answer I was before exposing myself or before getting out of the anonymity, I was a bit afraid in the sense that like what you mentioned, I was running Compounding Quality anonymously.

And then on Twitter, I saw some people, I think it’s Terry Smith or someone from Terry Smith’s team and then Oh no, this guy’s working on Wall Street and blah, blah blah. And I was like. I’m just a regular guy, 28 years old from Belgium, but if you want to think that please there was some kind of mystery again against Compounding Quality and after a while that also resulted in the fact that I was feeling very comfortable in being anonymous.

And with all the mystery going on, and then I said I exposed myself and said I was doing the account right. Why? Because I felt like you are talking about money, you’re talking about finances, investing and so on. So I thought people had the right to know who I am because trust, integrity, and honesty are really important in the industry. Something that people are missing a lot in the industry.

So yeah, to give you an example, I was the right hand of a senior fund manager managing an equity fund while in that fund there were around 200 million messages on the management. I didn’t invest a single dollar in the fund myself, and I also didn’t want to, and that gave me a feeling like, what are you doing well, what kind of life are you living if you do it that way? I think a lot of that is going on in the industry.

So there are people managing billions of dollars who don’t invest a single dollar in the fund themselves. That’s just completely wrong. Well, so many incentives and I’ll show you the outcome, right? So I think that’s important. And now I’m talking and I forgot the question. So if you can repeat it, I can get back to the lessons.

Tilman Versch [00:58:27] How was your coming out changing things?

Pieter Slegers [00:58:30] Yeah. So yeah. So I was afraid of that and then I exposed myself. But probably also a difference. Not sure if it’s the same in Germany, but the difference between the Belgian mentality and the US mentality, for example, when I said I was running the account, everyone was very, very positive about it.

So it’s great to know where we are right now or yeah, you are an entrepreneur right now. Kudos to you. We are supporting you. So that’s something that was really lovely. It also in hindsight helped me a lot like the traditional media exposure in Belgium right now, for example, columns, maybe sometimes even TV and stuff like that.

That helps. So it has been very positive while in the beginning indeed, I was afraid, oh, people being it’s a 20-year-old from Belgium it’s not some big guy on Wall Street but in the end, I didn’t experience it that way. The reactions were very positive in general.

Tilman Versch [00:59:35] That’s great to hear. Maybe for the end of the interview, let’s take a look at what you have currently. So there’s a newsletter. There’s a community. There’s the book. What else is there?

Pieter Slegers [00:59:50] So basically, yeah, we have Compounding Quality. Compounding Quality is mainly built on two social media channels, Twitter and LinkedIn. LinkedIn, I post on my real name, Pieter Slagers, which has 210,000 followers. Twitter has something like 430,000 followers. Then we go one step lower and you have the newsletter business.

So there we have Compounding Quality which is the main channel. There are almost 350,000 readers. We have the Dutch version. Unintelligible(Dutch version), which will be difficult to pronounce for most people with 10,000 readers and a dividend newsletter run by Josh with 110,000 readers. And then you have indeed the book, The Art of Quality Investing, which can elaborate on that. While The Art of Quality Investing has sold 8000 books so far I know that books like Quality Investing from Laurence Cunningham and Investing for Growth from Terry Smith have sold approximately 30,000 copies.

So that was our ambitious internal goal, but it doesn’t look like we will make that. OK. You have quality investing has only been on from April this year, April 2024, but we’ll see and right now I’m also still seriously thinking slash looking into launching an equity fund. And also there I think it’s integrity, honesty, transparency, really important. So when we pursue it will be a 06/25 fund like the Buffett Partnership structure which will result in making less money for yourself obviously, but it’s the right thing to do and on top of that probably 25% of the commissions that will be made from our side, from the business side will be given to charity.

So that will be the goal. But it’s still in the exploring phase, so not making any promises here, but that’s something that might be the next phase for Compounding Quality. But obviously running a newsletter and running an equity fund is a completely different thing. So I still have a lot of things to explore, to study and to continue I would say.

Tilman Versch [01:02:15] And the community?

Pieter Slegers [01:02:18] The community is included in Compounding Quality, so partners of Compounding Quality can be. They are included in the community so the community runs in the circle just like good investing does right now.

And there you can people can pitch stock ideas whenever something is going on in any company in a portfolio. Well, it will be published there. People can ask questions. So basically, I think for Compounding Quality, the goal is a very simple look, obviously, it’s a paid subscription, so you pay some money. It’s 399 USD for the regular subscription. That’s for a year and I provide you well. I analyse the stock market with all my heart and passion the entire week and I provide you with as much value as you possibly can, so everything is included there.

My personal portfolio, the community investment cases, ETF portfolio and so on. So just providing value and I think when you think about business, when you think about your business or launching your business, the big question like unintelligible said will start with why and the big question is which customer problem am I solving?

And when you aren’t solving a customer problem when you aren’t making a life of your customer to put it that way, I always call people who read Compounding Quality Partners. But when you don’t improve the life of your partners well then something is wrong, so you should be beneficial to their life, basically I guess.

Tilman Versch [01:03:51] What kind of persona do you think of when you write for your customer?

Pieter Slegers [01:03:58] It’s a difficult one because the problems of Compounding Quality are very broad from a retail investor to hedge fund managers to someone who is investing $1000 to someone who is investing 50 million USD. So it’s very, very broad. I think what people have your mind?

One thing, one question I ask when writing every article is, would Warren Buffett approve which would be sending out something like that, or some kind of investment case? I think that’s a good threshold to live by and a second point as I mentioned, I also want to write my article in such a way that my 14-year-old niece can understand it while being accurate and not being too short-sighted. I think those are two metrics I try to live by or ride by and I try to help me alongside the journey, I guess.

Tilman Versch [01:04:54] So there’s an easy quality philtre on the content that is easy to consume, but that is high quality.

Pieter Slegers [01:05:02] That’s the goal, at least. A part of me can decide whether I succeed, but that’s the goal.

Tilman Versch [01:05:08] Maybe as one of the last questions. Thinking about these different elements. Where do imagine yourself to be in five years with this?

Pieter Slegers [01:05:21] It’s a difficult question. Short answer. A bigger, stronger, better. I think that’s the main goal. Compounding Quality has been around for two years right now and I think it would be completely naive to state that things in five years from now will be the same as they are right now.

So I don’t think I have an answer for that. I think it’s important to keep learning and keep being flexible because for example, over this year I got quite some acquisition bits for Compounding Quality. Two things. One, I think I have a moral duty towards partners to not do something like that. I will never sell my soul for money to put it that way. And two, when I look at those acquires or potential acquires.

I think the key advantage UF, the key advantage compounding quality as right now is that we are small and flexible like the throw the spaghetti against the wall thing. It happens so much that in the morning, I read something in a book. And I’m just like, OK, let’s test it one hour later. Throw a spaghetti against the wall, and see whether it sticks or not. If it doesn’t stick, we go on.

If it does stick, well, you can invest heavily in that and that’s not something that’s a company, a big company with a whatever market cap of 1 billion and then and a few hundred employees can do. So that’s something I like as well. I think five years from now, hopefully, I think the newsletter will still be there and hopefully bigger, stronger, and better and then let’s see how the ideas for an equity fund will play out.

One important thing here is I should try or I should provide partners with as much value as I can and launching an equity fund shouldn’t harm that goal, so that’s the most important threshold for me right now. And when I feel like I can meet up to that expectation, I’m ready to launch an equity fund, I guess.

Tilman Versch [01:07:34] For the end of the interview, I always give the guest the chance to add anything or raise a question we haven’t discussed. So is there anything that comes to your mind?

Pieter Slegers [01:07:44] I will end as I started by generally thanking you I think you are doing an amazing job for the entire community and I’m providing so much value so I think you are one of the kindness, people I know, and I think way more people should know you in the industry.

And I’m sure that when you keep doing what you are doing, it will happen one day and I’m happy to help with that as well, and for the rest of the people reading. Well, just follow your passion. Be yourself, keep learning, keep reading, that’s the most important thing. And whenever anyone made it this far and still has a question for me, feel free to reach out, reach out via social media via e-mail and I’m happy to try and help you wherever I can.

Tilman Versch [01:08:38] Thank you very much. I can just give that back. You’re also super kind and helpful and I really like your story and that you found your calling. Somehow that’s an interesting marriage of, like, a lot of traits that are combined in you that shine through here, passion for investing, teaching and also like learning, which is the basis for teaching again, which is another flywheel.

Pieter Slegers [01:09:07] Absolutely. I have a lovely time. I hope people learn something new, and as mentioned, always available let’s keep in touch and let’s keep learning.