We are pleased to share exclusive insights from Jeremy Deal and his business partner Seth Lowry from JDP Capital into the advantages of managing a small fund. The conversation took place at London Business School earlier this year.

The following transcript has been edited for space and clarity.

Seth Lowry: Jeremy, what’s your background and why did you start JDP?

Jeremy Deal: I started my career at a small division of Honeywell (NYSE: HON) that designed and manufactured electronic home security equipment. The division had just been sold to Honeywell by the founder and CEO, whom I met through my college roommate’s father. I was not terribly interested in the industry, but I connected well with CEO and thought I could learn a lot about business from him. Two years later he asked me to join him and two others we worked with to start a competing company. By this point I had developed a strong interest in value investing and was at a crossroad between starting a new career in investing, or joining the startup. I chose the startup because I thought the business experience would be an enormous competitive advantage as a future investor. Three years later we sold the company and I left to start what would evolve to become JDP. Several years before I made the career switch I started reaching out to likeminded, well-known value investors for advice. At one of their shareholder meetings I met an investor from the Bay Area who also had a strong business background and experience picking value managers. We got along from the beginning, saw investing through the same lens and shared a similar temperament. In 2011 his family became my first investor, along with a friend of his.

Lowry: Originally coming out of high school, I had two professional aspirations. One was aviation and one was investing. I actually decided to pursue aviation first and went to the Air Force Academy. I got within an inch of being a fighter pilot, but it turns out I was extremely blind.

Deal: You can still read annual reports, so that’s good.

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