Finding the Next Great Tech Compounders | John Tinsman

In this episode of Excess Returns, we sit down with John Tinsman, portfolio manager of the AOT Growth and Innovation ETF (AOTG). John shares how his investing journey began, the lessons he learned from both successes and failures, and how those experiences shaped his current investment philosophy. We dive deep into the concepts of low marginal cost, profitable growth, digital toll booths, and the transformative impact of AI. John also discusses his approach to valuation, position sizing, and why he believes large-cap growth and technology will continue to lead in the years ahead.Main topics covered:John’s path from personal investing to launching an ETFLessons learned from early stock picks and market-making experienceThe power of low marginal cost businesses and long-term compoundingHow AI is reshaping software development, innovation, and profitabilityThe importance of revenue and earnings growth in stock selectionDigital toll booths as the future of software business modelsDifferences between profitable vs. unprofitable growth companiesWhy technology leadership today differs from the dot-com eraThe role of sectors, valuation, and position sizing in portfolio constructionJohn’s views on growth vs. value, large-cap vs. small-cap, and future innovation trendsTimestamps:00:00 The riskiest thing in investing02:00 John’s background and early investing journey05:00 Lessons from Apple, Boeing, Visa, and Potash10:00 Insights from agriculture and value investing12:00 AI’s impact on software development and innovation16:00 Sectors, classifications, and thematic approaches18:00 Comparing AI disruption to past bubbles21:00 Profitability in today’s tech companies22:00 Will the top companies stay dominant?26:00 Large-cap vs. small-cap technology investing28:00 Growth vs. value in today’s market30:00 Demographics, Buffett’s lessons, and sector shifts34:00 Value vs. software companies35:00 Digital toll booths explained37:00 Growth sustainability and digital infrastructure40:00 Semiconductor cycles and long-term demand44:00 Screening for growth and low marginal cost47:00 Sell discipline and valuation checks49:00 Position sizing and portfolio management51:00 ETF tax benefits and structure53:00 Where AOTG fits in portfolios54:00 One belief peers disagree with56:00 One lesson for the average investor57:00 Closing thoughts and outro