Update from the PMs – July 2025

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– Andrew Macken & Chris Demasi

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This letter marks Montaka’s 10-year anniversary. We are so humbled by the ongoing support and patience of Montaka’s investors, particularly those who have partnered with us since the early days.

At the heart of this Monocle is a deep exploration into something that has been central to Montaka’s investment insights over the past decade: the ‘flywheel’ conceptual model. That is, the business dynamic where a company shares its economics with its customers, which creates self-reinforcing symbiotic benefits to both.

Flywheels strengthen a company’s competitive advantages and increase the likelihood of reliable, long-term growth. Yet this highly valuable dynamic is routinely underestimated by markets and only achieved by a select few companies. Finding and owning these on your behalf remains Montaka’s relentless focus for the next 10 years and beyond.

In ‘Why Competitive Advantages Matter – And How Flywheels Make Them Stronger’, Andy takes a look at flywheels from a philosophical perspective. He illustrates how it is a conceptual model that connects so many investments in Montaka’s portfolio. And this model is at the core of why we continue to see substantial upside in our investment holdings.

One of these investments is US hard surface flooring retailer, Floor & Decor. In ‘How Floor & Decor Outperforms Home Depot & Lowe’s in the $40B Flooring Industry’, Lachlan answers important questions relating to the company’s flywheel and the large opportunity that lies ahead.

Finally, in this month’s Spotlight Series Podcast, Andy interviews Lachlan on ‘scale economics shared’ – another name for a flywheel, and a topic explored in his May essay titled ‘Patience and Probabilities: Where Montaka’s Competitive Edge Shines’. We explore mini case studies on the flywheels of Amazon, Spotify, and Floor & Decor.

 

 

Sincerely,

Andrew Macken & Chris Demasi

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Podcast: Join the Montaka Global Investments team on Spotify as we share real-time examples and investing tips that govern our stockpicks. Click below to listen. Alternatively, click on this link: https://podcasters.spotify.com/pod/show/montaka

 

 

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