Artisan Canvas

A Q&A with Portfolio Manager Craig Inman

Craig, happy 11-year Artisan anniversary. To commemorate your time at Artisan Partners and with the U.S. Value team, we have a few questions to better get to know you personally and professionally. To break the ice, please tell us a bit about yourself.

I grew up in South Carolina and have lived in the southern US my entire life. One thing that is interesting about my childhood is my dad was a professional golfer on the PGA Tour (he also played the Senior PGA Tour later in life). Back then, it was not the glamorous life it is now, though I do fondly remember the many places we visited when I was a kid. Once his career was over, we moved and settled in Atlanta. I went to college at Wake Forest University in North Carolina, which is where my dad and sisters also attended. After graduating in 1999, I moved back to Atlanta to begin working. I love Atlanta for many reasons, this is where I met my wife – we were married here in 2008. We now have three boys aged from 12 to 7. As one can imagine they keep us very busy!  I love investing as a profession, but it demands a lot of time and attention, so when I’m not working you can usually find me at home spending time with the family. When I have extra free time, I love to play golf. I played golf in college and still love the challenge of trying to keep my game sharp. Unfortunately, golf takes a lot of time, so I don’t get out on the course as much these days. To unwind and recharge I am also an avid runner. I’m mostly a trail runner, many mornings during the week and often on Saturdays, you can find me wandering the woods of North Atlanta with the great tribe of trail runners we have in the city.

Growing up, what did you want to be and where did you see yourself in your current phase of life?  What was your path to investing?

I wasn’t sure early in life what I wanted to do when I got older, but when I was 12, I began to play a lot of golf and it was my dream to be like my dad and play on the PGA Tour. I spent the next 10 years working hard to try and achieve that goal. Unfortunately, professional athletics is one that requires a superior (I’d say superhuman!) level of talent. I knew when I graduated from school, I would have to “get a real job”. Being a business major in college I spent some time reading about this guy Warren Buffett which piqued my interest in investing. I always had a strong interest in businesses and how they made money. Once I understood the mechanics of how stocks are partial ownership in a business, I was hooked. The stock market, was fascinating to me. Much like golf it is complicated, “unmasterable”, and takes a long time to build your knowledge and skills. It is also a process vs. outcome driven arena which fits my personality. I distinctly remember reading all of Berkshire Hathaway’s annual letters and a friend giving me a stack of Outstanding Investor Digest interviews as the formative material that helped me identify who I was as an investor.

As you’ve just celebrated your 11-year anniversary at Artisan, what do you think the special sauce is of Artisan and of the Artisan U.S. Value Team? 

In the early days it would have been hard for me to articulate this, but now I see it very clearly. The first component is we have the backing of an excellent firm that gives us the freedom to operate autonomously, while also taking care of operational details we would have to manage if we ran our own firm. This frees up our time and attention to do what we do best, invest. This is a unique model in the industry.

Next, we have a small team that is carefully chosen. This gives us an advantage because we are like-minded, team-oriented, and driven to follow a process that is time-tested through market cycles. The main thing I love is that we have a culture on this team that is open, trusting, with low egos, yet rigorous in debate. This culture and process give us a fiduciary mindset along with a collaborative and rigorous investment process that stands out in the industry.

As an investor, what excites you and/or scares you the most when researching an investment opportunity? What are the things you look for always and can apply broadly in your research efforts? 

I get excited when I see a good business, with a clean balance sheet and a path to higher earnings that shows the current asking price of the business is very cheap. It takes a lot of work to try and confirm the evidence, but I love digging in to try and find the truth. Of course, what is scary is no matter how much you dig, you can’t know for sure. The world is too uncertain, so any investment always requires embracing risk. I try to decrease risk as much as possible by having a strong understanding of the moat around a business and what its business characteristics are likely to be in the future. This means I’m looking for the ability to keep generating free cash flow far into the future under a lot of different scenarios.

Why Value? What about Value Investing really appeals to you and the core of who you are? 

I think the market is generally efficient. I believe most of the inefficiencies reside where there is fear and uncertainty on the rise. Markets in the short term are voting machines, and people’s emotions are key factors in setting stock prices at moments in time. This ebb and flow of investor sentiment can create opportunities for investors who have a lens on the intrinsic value of a business and a longer time horizon. When the news is getting worse, investor time horizons tend to shrink. This is another reason why I believe structurally, that being a value investor is a superior method for getting more return for the risk being borne in an investment.

If you could spend time with anyone, currently living or from the past, who would it be and why? 

Great question!  I’d probably choose Warren Buffett because I’m a big fan and would love to spend time asking him questions. Of course, I can’t help but think if we are granting wishes, playing a foursome with my dad, Jack Nicklaus, and Arnold Palmer would be at the top of my list!  I’d still take dad as my partner in a four-ball.