Announcing New Membership Benefits

Free release on capital-light home builders, exploratory reports, and new member benefits

As our Speedwell Research members know, we have recently launched a new research product called Exploratory Reports, which are included at no extra cost in a Speedwell Membership. We will be sharing the first one of these for free next week. 

The idea behind the Exploratory reports is to do "pre-research" to see which companies are worth researching more. The earlier companies we wrote about were already familiar to us and thus had been effectively "pre-vetted." However, we are facing a bit of a paradox now as it is hard to decide to commit weeks to researching a company before we know that that company is worth committing weeks of research to. 

Thus, we are rolling out "Exploratory Reports" where we will write up companies we stopped researching part way through the process. These will be shorter pieces (our first one is 22 pages) that explore a company and/or new industry, but are not as in-depth as our typical 80+ page reports. We will keep tabs on these companies, and if the facts change, we may revisit them in the future. 

Our first exploratory research piece on the homebuilder, Dream Finders Home (DFH), was released a few weeks ago to our members. To give potential subscribers a sample of the work, we have decided to make this piece free. 

We were initially drawn to homebuilders because their ROICs were much higher and consistent than we expected. After doing some research, we found Dream Finders Homes, or DFH. This one was interesting to us because they utilize a capital-light homebuilding model and are still led by the founder, who owns over 60% of the stock. There is another capital-light homebuilder, NVR, that has had a fantastic multi-decade performance, and DFH’s plan is essentially to copy them. 

Founder Patrick Zalupski started DFH in the midst of the 2009 housing crisis, and in just over a decade he has built it up to generating $3bn in annual revenues, making himself a billionaire in the process. His two annual shareholder letters are written in plain language and as a capital allocator thinking about the average shareholder (you can read them here).

In this piece, we touch not just on DFH, but the homebuilding industry in general, certain macro trends, and some homebuilding peers, particularly NVR. 

Be on the lookout for the release of this piece next week! If you wish to become a member you can gain access to it today though, as well as our Extensive Research Reports on CPRT, FND, RH, CSU, ETSY, among others! We will also be releasing an Extensive Report on Evolution later this month!