Short Briefings on Long Term Thinking - Baillie Gifford

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Sep 2026

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Baillie Gifford’s Short Briefings on Long Term Thinking bring valuable insights into the benefits of taking the long view. You’ll hear frank, thought-provoking opinions from our team in Edinburgh and experts around the world. These podcasts do not constitute an offer of or solicitation for purchase or sale of securities or provision of any investment services. They are provided for information only and should not be considered as investment advice or a recommendation to buy, sell or hold a particular investment. Our podcasts have been compiled with considerable care to ensure their accuracy at the date of publication. No representation or warranty, express or implied, is made to their accuracy or completeness. For further details please see our legal information at www.bailliegifford.com

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September 28, 202627 min

Emerging markets: when the crowd gets it wrong

The biggest car-carrying ships on the planet. A chip-testing rig that weighs as much as a small elephant. Investment manager Alex Summers takes us inside some of emerging markets’ least-watched growth companies to explain how his team sees what others have missed. “Often, the crowd is going to be right,” he acknowledges, but when it’s not, long-termism, access to management and asking different questions are key to how his team determines investment opportunities. Background: Alex Summers is co-manager of our Emerging Markets Leading Companies Fund, an investment manager in our Emerging Markets Equity Team and a member of the International Growth Portfolio Construction Group. In this conversation, he tells Short Briefings… host Leo Kelion why one of his team’s guiding principles is that before investing in a company, he and his colleagues must be able to articulate the critical uncertainty about a stock and why others may be wrong. “Often, you can observe something about a company, and it may be true,” he explains. “But if everybody else believes that, you’re not going to create any additional outperformance by owning those companies.” Companies discussed include: Hyundai Glovis – the logistics company that’s invested in a dozen ultra-sized ships and now sees an opportunity in transporting spent electric vehicle batteries Chroma ATE – the test-equipment company whose customised cabinets provide critical checks for NVIDIA and Nasa Silergy – the mainland China-based semiconductor company specialising in power-management chips Reliance Industries – India’s most valuable company and its heavy investment in solar panels, green hydrogen and battery storage systems Toss – the South Korean financial super-app that provides banking, payment and ecommerce services Resources: Baillie Gifford website Emerging Markets Leading Companies Fund Emerging markets: from imitators to innovators (video) Emerging markets: the next engines of global growth Short Briefings on Long Term Thinking podcast archive When consensus fails Companies mentioned include: · Chroma ATE · Hyundai Glovis · Meituan · NVIDIA · PB Fintech · Reliance Industries · Samsung Electronics · Silergy · SK hynix · Talabat · Toss · TSMC Timecodes (audio version): 00:00 Introduction 01:45 From Toronto to Edinburgh 02:35 A lesser-covered class of companies 03:35 Taking a five-to-10-year view 04:15 Forming non-consensus views 05:35 Hyundai Glovis and EV batteries 07:10 Corporate governance reform in South Korea 09:30 Getting access to senior leaders 11:50 Chroma ATE’s chip-testing equipment 14:50 Building conviction in Silergy 16:30 Declining to invest in Talabat 18:20 Visiting Reliance Industries in Jamnagar 20:45 Retaining sell discipline 22:00 Toss and private companies 24:15 Moving towards physical assets 25:35 Podcasts and Substack picks Glossary of terms (in order of mention): Magnificent Seven: A nickname for seven large US technology-related companies – Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA and Tesla. Holding period: The length of time an investment is owned. Corporate governance: The systems and processes by which a company is directed and controlled, including board accountability and the treatment of shareholders. Minority shareholder: An investor who owns less than a controlling stake in a company and cannot direct it alone. Bottom-up investing: Assessing individual companies rather than starting with forecasts for economies, markets or sectors. Economies of scale: Advantages that arise as a company handles more volume, reducing the average cost of each unit. Profit margin: The proportion of revenue left as profit after costs have been deducted. Graphics processing unit (GPU): A chip designed to perform many calculations in parallel, originally for graphics but now also widely used in AI. Analog chip: A semiconductor that processes continuous real-world signals, such as sound, temperature or voltage. Flotation or initial public offering (IPO): The process by which a private company first offers shares to public investors and lists them on a stock exchange. Cash flow: The movement of money into and out of a business over time. Capital allocation: The decisions a company makes about how to use its money, such as investing in growth, making acquisitions, paying dividends or reducing debt. Business vertical: A distinct business area within a company, usually focused on a particular product, service or market. Overweight: Holding more of an investment, sector or theme than the index used for a comparison. Fintech: Technology-driven financial services, such as digital payments, lending or banking tools. Insurance brokerage: A business that helps customers compare and buy insurance, acting as an intermediary between them and insurers. Capital-light: Describes a business that needs relatively little investment in physical assets to operate and grow.

August 31, 202631 min

Greek loans, Polish denim, German cookers: the new shape of European growth

“Europe looks more like emerging markets than it does North America,” Joe Faraday, Baillie Gifford’s new head of European equities, suggests in this conversation. He means that growth takes many forms across the continent, creating an eclectic mix of companies to choose from and specific circumstances to consider. As he reveals, it’s led him to reposition the portfolios under his watch, broadening the types of companies they contain. Background: Joe Faraday is our head of European equities and investment manager of the Baillie Gifford European Growth Trust and European Fund. In this conversation, he tells Short Briefings… host Leo Kelion about some of the stocks he has added to and removed from the portfolios of our European Growth Strategy. Faraday took charge earlier this year with a mandate to improve performance. “We’ve changed rather a lot,” he says, regarding efforts to broaden the mix of growth themes the portfolios he manages tap into, while ensuring that he grounds each buy or sell decision on an intimate understanding of each stock. Companies discussed include: Piraeus Bank – Greece’s biggest lender, expanding its reach with new insurance, asset management and digital banking services LPP – the Polish retail group behind Sinsay, the rapidly growing fashion and homeware brand big in central and eastern Europe TotalEnergies – the French energy group involved in exploration and production, liquefied natural gas and renewables Rheinmetall – the German defence contractor, whose activities range from drones and armoured vehicles to ammunition and satellites Bending Spoons – the Italian app acquirer that rearchitects and revitalises mature digital businesses Rational – the German manufacturer of ‘combi ovens’ designed for commercial kitchens Resources: A disciplined case for European Growth European megatrends: what’s on my mind? Supercommunicators by Charles Duhigg The European opportunity set The Short Briefings… archive Companies mentioned include: · Airbus · Allegro · Bending Spoons · CaixaBank · Dino Polska · Exail · Iberdrola · Piraeus Bank · LPP · LVMH · Nexans · Rational · Rheinmetall · TEKEVER · TotalEnergies Timecodes: 00:00 Introduction 01:50 From paint-making to portfolio management 03:30 Investment track record 05:25 Broadening the growth types 07:05 Megatrends and individual circumstances 08:45 Rearmament, energy security and consumption 10:30 “Europe’s not like Marmite” 11:45 TotalEnergies – a mega energy business 16:30 Rheinmetall – a catch-all defence contractor 19:05 LPP – the Zara of eastern Europe 22:20 Piraeus Bank pushes into insurance 24:40 LVMH and the outlook for luxury 26:40 Building on Bending Spoons 28:50 “Decisive action has been taken” 29:35 Book choice Glossary of terms (in order of mention): Small-cap: Shares in companies with relatively small total stock market values. Compound: Gains that build on earlier gains, so an investment’s value can grow at an increasing rate over time. Exploration and production: The part of the oil and gas industry that searches for reserves and extracts them. Liquefied natural gas (LNG): Natural gas cooled into liquid form so it can be stored and transported more easily. Integrated power: A business that combines several parts of the electricity system, such as generation, trading and supply, often across conventional and renewable sources. Capital allocation: The decisions a company makes about how to use its money, including investing in operations, buying businesses, repaying debt or returning cash to shareholders. Free cash flow: Cash left after a company has paid its operating costs and the investment needed to maintain or expand the business. Capital markets day: An event where a listed company gives investors and analysts detailed information about its strategy, operations and financial prospects. International Monetary Fund (IMF): An international institution that monitors economies, advises governments and can lend to countries facing financial difficulty. Flotation: The process by which a private company lists its shares on a public stock market, often through an initial public offering (IPO).

August 4, 202636 min

SpaceX: past, present, future – and finding the next world-changers

Baillie Gifford first invested in SpaceX in 2018, nearly eight years before its record-setting stock market listing. Investment manager Luke Ward, who championed the holding, discusses what first drew him to the business, why Starship is critical to its future, and reveals where he’s now looking for another company with industry-upturning potential. Background: Luke Ward is an investment manager on Baillie Gifford’s Private Companies Team and co-manager of Edinburgh Worldwide Investment Trust. In this conversation, he tells Short Briefings… host Leo Kelion how SpaceX’s first successful landing and recovery of one of its rocket boosters led him to explore an investment in the company, and how he gained access to its senior management. Ward also explores three growth drivers that could determine its future success: regularly flying a new, larger spacecraft, Starship, into orbit upgrading its Starlink broadband network with satellites that connect to smartphones directly putting and operating datacentres in orbit In addition, he discusses some of the risks in being a long-term shareholder in the Elon Musk-run endeavour. Ward also reveals why he thinks the construction industry is ripe for disruption from 3D-printing robots. Resources: Baillie Gifford Private Companies Team Edinburgh Worldwide Investment Trust Elon Musk by Ashlee Vance Private companies: our philosophy Quantum, space, fusion: three firms engineering the future SpaceX: the economics of the impossible Starlink: broadband from above Titan robotic construction system Companies mentioned include: · Alphabet (Google) · Anthropic · Astranis · Rocket Lab · SpaceX · Tesla Timecodes: 00:05 Introduction 02:00 A successor to the Space Shuttle 03:55 Reimagining a market 05:55 Reusable rockets 06:30 Mars as a ‘forcing function’ 07:55 First encounter with Gwynne Shotwell 10:10 The ‘scale of the Dutch East India Company’ 12:40 What we got wrong 14:25 The advantages of early access 17:50 Starship’s cost advantage 19:40 Next-generation Starlink satellites 22:30 AI and space-based datacentres 27:20 SpaceX’s scale of ambition 29:00 Governance risk 31:05 Flywheels and stepping stones 32:55 3D-printed homes 34:25 A “nerdy” book pick Glossary of terms (in order of mention): Path dependency: The idea that earlier choices shape and constrain what becomes possible later. Rocket booster: The part of a rocket that provides extra thrust during launch, usually early in flight. Orbital-class craft: A spacecraft or rocket powerful enough to reach orbit around Earth. Market capitalisation: A public company’s total value on the stock market, calculated from its share price and number of shares. Vertical integration: When a company owns and controls more of its supply chain itself, rather than relying on outside suppliers. Point solution: A product or service built to solve one specific problem, rather than a broader system of related problems. Balance sheet: A financial statement showing what a company owns, owes and is worth at a point in time. Roadshow: A series of presentations in which a company and its advisers meet potential investors before a share sale or listing. Cost curve: The trend in how the cost of producing or delivering something changes as technology improves or scale increases. Geostationary orbit: An orbit where a satellite moves at the same rate as Earth rotates, so it appears to stay above the same point on the planet. Transistors: Tiny electronic switches used in computer chips to control electrical signals. S-curve: A pattern where progress starts slowly, accelerates rapidly and then slows again as a technology matures. Ancillary services: Supporting services or costs around the main product or technology, rather than the core hardware itself. Orders of magnitude: Very large multiples, usually powers of 10. Radiation hardening: Designing or adapting electronics so they can keep working despite radiation in space. Cap table: Short for capitalisation table, a record of who owns a company’s shares and on what terms. Thermal mass: A material’s ability to absorb, store and release heat, helping to smooth temperature changes.

June 23, 202631 min

Tokenisation: a better way to own what you own

Tokenisation represents an “operating system upgrade” for the investment industry, says Theo Golden, Baillie Gifford’s new head of digital assets. In this episode, they explain what it involves and how it should deliver a better experience, both by reducing the number of middlemen between you and your investments and making your holdings more “useful”. Background: In this conversation, Theo Golden tells Short Briefings… host Leo Kelion about how tokenisation can reduce costs and complexity – and pave the way for providing clients with new services that better fit their needs. Tokenisation means taking an asset – such as a fund – and turning it into a line of code. This lives on a blockchain: a shared digital record that no single party owns or controls. The investment itself doesn't change, but what does are the ways that ownership is recorded and transferred. Instead of a chain of intermediaries, each keeping their own set of books, everyone can work from one shared record. As Golden puts it, it's “the same but better” – the same investments, on faster, lower-cost, more flexible rails built for the internet age. It also paves the way to new capabilities. Among those Golden discusses are making it much easier for clients to use the funds they invest in as collateral for loans, and the development of “agentic wealth management” – AI bots that autonomously plan and, potentially, update an individual client’s portfolio based on their risk appetite and changing circumstances. Baillie Gifford’s first steps with tokenisation involve fixed income, but in time the ambition is to “build across our investment universe,” Golden says. “So be ready for Baillie Gifford on chain.” Resources Baillie Gifford digital assets hub Dr Ian Hunt: Replicating Legacy is Squandering the Promise of Tokenisation: We Are Building a Faster Horse Short Briefings on Long Term Thinking podcast archive Timecodes: 00:00 Introduction 01:40 “A world with less friction” 02:15 The lesson from losing it all 04:50 From Bloomberg to bonds 06:35 Defining tokenisation and the blockchain 08:20 Same assets, better system 09:35 One golden source of truth 12:35 Making assets more useful 16:10 Turning assets into “Lego bricks” 19:20 Stablecoins, regulation and new decision-makers 24:00 Managing crypto risks 26:25 The ‘same but better’ rule 28:00 Starting with fixed income 29:20 Meeting clients where they are 30:27 Book pick Glossary of terms (in order of mention): Trading volumes: The amount of buying and selling taking place in a market over a period of time. Blockchain-based tokenisation: The use of blockchain technology to create digital tokens that represent ownership of assets. Self-sovereign: Controlled directly by the owner, rather than depending entirely on a bank, platform or intermediary. Custody: The safekeeping of assets. Self-custody means holding and controlling the asset directly yourself. Counterparties: The other parties involved in a financial transaction or agreement. Multi Asset: An investment approach that can invest across several asset classes, such as shares, bonds, currencies and infrastructure. Catastrophe bonds: Bonds that transfer insurance-related risks, such as natural-disaster losses, from insurers to investors. FX rates: Foreign exchange rates. Smart contract: Computer code that automatically carries out agreed rules when certain conditions are met. Token: A digital representation of an asset or ownership right on a blockchain. Walled garden: A closed system where users can only operate within the rules and limits of one provider or platform. Fixed income fund: A fund that invests mainly in bonds or other debt instruments that typically pay interest. Growth equity fund: A fund that invests in companies expected to grow faster than the wider market. Vehicle for transfer: The system or method used to move ownership or value from one party to another. Rails: The underlying infrastructure that allows transactions or transfers to take place. Reconciliation: The process of checking that different records match each other. Shareholder registry: The official list of people or organisations that own shares or fund units. Transfer agency register: A fund-administration record that tracks investor ownership and transactions. Wallet: A digital tool used to hold and manage blockchain-based assets. Finality: The point at which a transaction is considered complete and cannot easily be reversed. Unitisation: The process of dividing a fund into units so investors can buy and sell a share of the fund. Inert: Hard to move, transfer or use in other financial activities. UK gilt: A UK government bond. Margin call: A demand for more cash or collateral when the value of an investment or position has fallen. Interoperability: The ability of different systems, assets or pieces of software to work together. Composability: The ability to combine digital assets or software components, like building blocks, to create new services. COBOL: Common Business-Oriented Language – an older computer programming language still used in some legacy financial systems. AI agents: Software that can act semi-independently to carry out tasks on behalf of a user. On-chain books and records: Official ownership and transaction records kept on a blockchain. Stablecoin: A digital asset designed to track the value of a traditional currency, such as the US dollar or pound. Fiat currency: Government-issued money, such as pounds, dollars or yen, that is not backed by a physical commodity such as gold. USDC: A stablecoin issued by Circle that is designed to track the value of the US dollar. FCA: The Financial Conduct Authority, the UK regulator for financial services firms and markets. Burn a token: Permanently cancel or destroy a digital token so it can no longer be used. Remit a token: Re-issue a token to a new wallet. Neobank: A digital-first bank, usually operating mainly through apps or online services.

June 1, 202636 min

Why American culture feels so chaotic – and how investors can benefit

The US public’s tastes and habits are fragmenting, leading to new consumer behaviours. The shift from a handful of TV networks to an endless supply of streamed shows and social media clips is just one of many causes. Investment manager Dave Bujnowski discusses the characteristics that determine which growth companies should thrive in the resulting ‘high entropy’ environment. Dave Bujnowski is an investment manager in our US Equity Growth Team and co-manager of the Baillie Gifford U.S. Equity Growth Fund and our American Fund. In this conversation, he tells Short Briefings… host Leo Kelion about his work with anthropologist Dr Grant McCracken, studying the causes and effects of the fragmentation of American culture. They believe that US culture is a system that has entered a ‘high entropy state’ – meaning that tastes and habits no longer change in an orderly manner. The result is “tremendous instability” and a sense of “continual pandemonium”. This shift, they argue, has implications for growth companies and helps explain why some are struggling to maintain mass-market appeal. But the disorder also plays to others' advantage, and they have sought to identify which will thrive and why. Portfolio companies discussed include: · Cloudflare – the service that protects websites from attack and optimises their performance · DraftKings – the sports gambling platform that lets Americans bet on sporting events · Samsara – the Internet of Things specialist helping companies track and make sense of data · SharkNinja – the home appliance company behind the CREAMi ice-cream maker · Shopify – the ecommerce platform serving merchants · Resources: Dr Grant McCracken Short Briefings on Long Term Thinking podcast archive The Long View collection Thinking in Systems When systems fragment: entropy, cultural change and the next great US companies Companies mentioned include: · Alphabet (Google) · Amazon · Cloudflare · DraftKings · Meta · Netflix · Samsara · SharkNinja · Shopify · SpaceX Timecodes: 00:00 Introduction 02:05 System-level thinking 03:20 How change happens 06:10 Entropy and fragmentation 08:15 A conversation with Cloudflare’s CEO 10:20 Ants and anthropology 13:25 Grant McCracken on North Sea culture 15:15 The causes of splintering culture 17:05 New consumer behaviours 19:15 Challenging times for lululemon 21:00 Shopify and agility 23:10 Agentic commerce 25:40 SharkNinja and new niches 28:30 DraftKings and cultural anchors 30:40 Samsara’s entropy antidote 32:10 Finance and space: systems to watch 33:50 Book choice Glossary of terms (in order of mention): Entropy: In this podcast, a metaphor for systems becoming more fragmented, varied and harder to predict. Cash flows: The money moving into and out of a business. Market cap: The total stock-market value of a company: share price multiplied by number of shares. S&P 500: A major US stock-market index of large companies. Second law of thermodynamics: A physics principle often simplified as the tendency of energy in a closed system to spread out over time. Mainframe: A large, central computer used by organisations to process major computing tasks. Big iron: Informal technology term for large, powerful central computers. MMA: Mixed martial arts, a full-contact combat sport. Delulu: Internet slang for optimistic or unrealistic self-belief. Short for ‘delusional’. Traffic aggregation: Bringing together large numbers of users or customers in one place, often online. Total addressable market (TAM): The total potential market size for a product or service if it reached all possible customers. Prediction markets: Markets where people trade contracts based on the likelihood of future events. Internet of Things: Everyday equipment connected to the internet so it can collect and share data.

May 4, 202634 min

The big squeeze: when bottlenecks work to your advantage

Bottlenecks often act as constraints on growth, but companies that create funnels through them can gain pricing power and capture long-term value. Investment manager Mike Taylor reveals some of the companies he thinks achieve this best and how he spots such pinch points before they fully form. Mike Taylor is a Baillie Gifford partner, an investment manager in its Global Alpha Strategy and a co-manager of The Monks Investment Trust. In this conversation, he tells Short Briefings… host Leo Kelion about how bottlenecks can confer an advantage on companies that sit astride them. That includes those that serve a mismatch between supply and demand created by others, and those whose products and services create a new pinch point, which they control. In addition, he explains why mixing a cocktail of bottlenecks in his portfolios can deliver smoother growth for their shareholders. Portfolio companies discussed include: Medpace – the drug and biologic contract research organisation Games Workshop – the maker of the Warhammer tabletop battle games Tidewater – the provider of offshore vessels to the oil and gas sector Freeport-McMoRan – the mining company that produces gold and copper, among other minerals DISCO – the precision tools company, widely used in the semiconductor industry Samsung Electronics – the electronics conglomerate SK Hynix – the memory chip specialist Resources: Don’t Burn Your Boats: the case for selective AI investing Global Alpha Investment Strategy SPQR: A History of Ancient Rome Short Briefings on Long Term Thinking podcast archive The Monks Investment Trust Valuing scarcity in the age of AI Companies mentioned include: Amazon DISCO Games Workshop Tidewater Freeport-McMoRan Medpace NVIDIA Samsung Electronics Sandoz SK Hynix Timecodes: 00:00 Introduction 02:10 Investing inside and outside Baillie Gifford 03:55 Defining bottlenecks 04:45 How Medpace helps biotechs meet regulatory requirements 07:35 Founder-leader, August Troendle 09:30 Stress testing the bottleneck 12:00 Games Workshop creates its own pinch point 14:50 Shepherding Warhammer over the long term 17:45 Mixing bottlenecks to reduce volatility 20:05 Tidewater and the coming offshore vessel shortage 23:30 Freeport-McMoRan feeds the US’s copper needs 26:20 AI bottlenecks: silicon wafers and high-bandwidth memory 30:00 Enduring versus fleeting bottlenecks 31:25 Book choice Glossary of terms (in order of mention): Adenovirus: A common type of virus that can cause mild illnesses such as colds, sore throats or conjunctivitis, but can also be modified for medical uses such as delivering genes into cells. Gene therapy: A treatment that works by adding, altering or replacing genes inside a patient’s cells to treat disease. Clinical trials: Research studies in people that test whether a medicine, treatment or medical approach is safe and effective. FDA: The US Food and Drug Administration, the regulator responsible for approving medicines, vaccines and medical devices in the United States. Contract research organisation: An organisation that helps biotechnology and pharmaceutical companies run clinical trials. Private partnership: A business owned by its partners rather than by public shareholders. Supernormal profits: Profits above what would normally be expected in a competitive market. Supply side: The part of an industry concerned with how much of a product or service companies can provide. Demand side: The part of an industry concerned with how much customers want or need a product or service. Rate limiter: The factor that determines the maximum speed at which something can grow, expand or be produced. Novel therapies: New types of medical treatments, often based on recent scientific advances. Intellectual property (IP): Legal rights over creations such as brands, stories, characters, designs, patents or software. Free cash flow: The cash a company produces after paying the costs needed to run and maintain the business. Energy transition: The shift from fossil-fuel-based energy systems toward lower-carbon sources such as renewables, batteries and electrification. Compute: The processing power needed to train or run AI models or other computing tasks. High-bandwidth memory (HBM): A type of advanced memory chip that can move very large amounts of data quickly to processors, making it especially useful for AI systems. Steam turbine: A device that uses steam to spin a wheel or rotor, converting heat energy into mechanical motion.

March 16, 202638 min

The active edge: the case for growth in uncertain times

A series of “extraordinary” events has made the environment more challenging for growth stocks. But “this level of trepidation can’t go on forever”, says Baillie Gifford partner Stuart Dunbar in this latest episode, suggesting that patient investors will benefit when stability returns and the markets value exceptional companies at a premium again. Stuart Dunbar is a director in Baillie Gifford’s Clients Department and is responsible for helping shape and communicate the firm’s investment philosophy. In this conversation, he considers how a succession of disruptive events – the most recent being the current war in the Middle East – has rattled markets and led investors to focus on companies’ short-term profits rather than their long-term potential. However, this period of flux will not last forever, he argues. And when we re-enter a period of stability, patience should be rewarded as markets recognise exceptional companies’ future earnings potential and price them accordingly. In the meantime, Baillie Gifford’s investment teams remain focused on finding and supporting businesses that will prosper from change and supporting their management to take the long view. And as Dunbar reveals, as the sources of growth broaden out, we are backing some companies that come as a surprise. Portfolio companies discussed include: Astera Labs – the semiconductor chip designer, whose products tackle data bottlenecks in AI datacentres IREN – the datacentre operator whose clients include Microsoft Medpace – a contract research organisation that biotech and pharmaceutical companies hire to run their clinical trials Nu Holdings – owner of the Latin American fintech Nubank Spotify – the audio streaming platform that lets people listen to music, podcasts and audiobooks WillScot – North America’s largest provider of temporary space rentals, leasing out modular offices, portable storage containers and classroom units Resources: Actual investors hub Actual investing revisited Baillie Gifford podcasts Private growth investing The Compound and Friends podcast The Success Equation Companies mentioned include: AJ Bell Amazon Anthropic Astera Labs ByteDance IREN Medpace Microsoft Nu Holdings NVIDIA Spotify WillScot Timecodes: 00:00 Introduction 02:00 Active v passive 03:35 “Know what we own” 06:15 Building relationships with company leaders 07:55 Causes and effects of uncertainty 11:05 Beyond the Magnificent 7 12:45 A period of relative stability 17:50 Compressed valuations 19:25 Nubank and Medpace’s promise 23:10 Meetings with clients 25:40 Broader sources of growth 28:15 Private equity growth 31:25 Better-informed stock picking 33:25 Staying independent and standalone 35:45 “Wait until the market comes to its senses” 37:10 Book choice Glossary of terms (in order of mention): Latent heat: energy absorbed or released during a change of state, like ice melting, without a change in temperature. Active investing: trying to beat the market by choosing investments based on research and judgement. Passive funds: investment funds that track a market index rather than picking stocks actively. Quantitative approaches: investment methods that use data, models and statistics to make decisions. Market capitalisation weights: an index method that gives bigger companies a larger influence based on their total market value. Alignment of incentives: making sure different parties are rewarded in ways that encourage the same goals. Drawdowns: significant falls in the value of an investment from a previous peak. R&D: research and development – spending on innovation and new products or technologies. Backdate options: setting share-option dates retrospectively to make them more valuable, often controversially. Shareholder registers: the official records of who owns a company’s shares. Benchmark: a standard, often an index, used to compare investment performance. Magnificent 7 / Mag 7: the seven giant US tech stocks that have dominated market performance in recent years. GPU: graphics processing unit – a specialised chip often used for AI computing because it handles parallel tasks well. Sub-market multiple: a valuation lower than the market average. Strategic asset allocation: deciding how much to invest in broad asset classes like shares, bonds or private markets. Benchmark-aware: closely focused on performance relative to a benchmark index. Venture capital: investment in early-stage, high-growth private companies. Private equity buyout funds: funds that buy controlling stakes in companies, often using debt. Private equity growth: investing in more mature private companies that are expanding but not yet public. Roadshow: presentations by company leaders to investors ahead of an IPO or fundraising. Alternative asset classes: investments outside traditional shares and bonds, such as private equity or infrastructure. Path dependency: the idea that outcomes are shaped by the sequence of earlier decisions and events.

February 13, 202632 min

China’s new growth leaders: inventing, not copying

From new cancer drugs to batteries and robotics – China’s top-tier growth companies are forging paths of their own rather than following in the west’s footsteps. Investment manager Sophie Earnshaw names companies that have caught her eye and explains why being a long-term stock picker differs in China from elsewhere. Background: Sophie Earnshaw is a decision-maker on our China Equities Strategy and joint manager of the Baillie Gifford China Growth Trust. In this conversation, she tells Short Briefings… host Leo Kelion about a select group of Chinese companies breaking new ground, supported by the state’s efforts to become self-sufficient in more of today’s critical technologies and a leader in some of those of the future. Earnshaw also details how the “phenomenal rate” at which companies are born, scale and die in the country makes stock-picking a challenging task – making the access we have to company leaders, academics and other local expertise core to our mission of finding the best firms to invest in on behalf of our clients. Portfolio companies discussed include: - CATL – the battery maker whose products power electric vehicles worldwide and increasingly support the renewable energy sector - BeOne and Innovent Biologics – pharmaceutical firms developing the next generation of cancer drugs - AMEC and NAURA – semiconductor equipment makers enabling China to develop increased self-reliance in computer chips - Alibaba, ByteDance and Tencent – China’s ‘big tech’ companies, whose artificial intelligence tools are becoming embedded into people’s daily lives - MiniMax – the AI startup rolling out video and agentic tools at a fraction of the cost of western counterparts - Horizon Robotics – the automated driving tech provider with its eye on an even bigger opportunity. Resources: Baillie Gifford podcasts China: a tale of two stories China investment strategy hub (institutional clients only) House of Huawei Private investor forum 2025: investing in great growth companies Trip notes: on the road with Baillie Gifford China Growth Trust Companies mentioned include: Alibaba AMEC ASML BeOne ByteDance CATL Horizon Robotics Innovent Biologics Jiangsu Hengrui Huawei MiniMax Samsung NAURA Tencent TSMC Xiaohongshu Timecodes: 00:00 Introduction 01:55 Joining the China Equities Strategy 02:40 Intense competition 04:00 The government’s influence 06:10 CATL, the electrification champion 08:45 Investing with a 5-year time horizon 10:25 Shanghai office, local expertise 11:45 Regulations and geopolitics 14:30 China’s next Five-year Plan 16:15 Innovent Biologics’ new cancer drugs 18:10 Lower-cost clinical trials 19:45 Being selective in semiconductors 21:25 Investing in chip equipment makers 23:00 China’s ‘big tech and AI’ 25:10 MiniMax making AI like ‘tap water’ 27:45 The road to robotics 29:35 A market you can’t ignore 30:30 Book choice Glossary of terms (in order of mention): Third plenum: a major policy meeting of China’s ruling Communist Party, often used to set big economic/political direction. Sovereign bond issuance: The government raising money by selling bonds (IOUs) to investors. Opportunity set: the range of investable companies available to choose from. Capex: capital expenditure – money spent on long-term assets like factories, equipment, or data centres. Fiscal deficit target: how much more the government plans to spend than it collects in revenue (taxes plus other income), expressed as a share of the economy. GDP: gross domestic product – the total value of goods and services a country produces in a year. Market capitalisation: the total value of a company’s shares (share price × number of shares). ESG: environmental, social and governance – how a company manages environmental impact, people issues, and corporate oversight. Large-form batteries: big battery packs used in things like electric vehicles and grid storage. Energy storage systems: large batteries that store electricity for later use (helping balance the grid). Generic drugs: copies of medicines whose patents have expired; usually cheaper, same active ingredient. Bi-specific (bispecific) drugs: drugs designed to bind to two targets at once (often to direct immune cells to cancer). ADC drugs: antibody–drug conjugates – antibodies that deliver a toxic payload to cancer cells. Out-licensing: selling rights to your drug/technology to another company (often for upfront + milestone payments). EUV machines: extreme ultraviolet lithography equipment used to make the most advanced chips. Foundry: a factory business that manufactures chips for other companies. Etch and deposition: steps in chipmaking – etch removes material to form patterns, deposition adds thin layers. Picks and shovels: a metaphor for companies that sell essential tools to an industry (rather than end products). Digitalisation: moving processes and services from offline to software and data-driven systems. Compute: the processing power (chips and servers) used to train/run AI. Large language model (LLM): an AI trained on lots of text to generate and understand language. Margins: how much profit a company makes per pound/dollar of revenue (after costs). Cloud business: selling computing power/storage/software over the internet instead of on a local machine. Algorithm layer: the method or software logic that makes the AI work (as distinct from the hardware). Gross margin: revenue minus direct costs (before overheads), a rough measure of product profitability. Assisted driving: features that help a driver (lane-keeping, adaptive cruise control, etc) but don’t fully replace them. Autonomous driving: a car driving itself with minimal or no human input. Software attachment rate: the percentage of customers who add paid software features and/or subscriptions.

January 14, 202635 min

Smarter models, sharper founders: growth investing in the AI era

With developments in generative AI progressing at such a furious pace, how can investors cut through the noise to identify the companies that will really matter? Baillie Gifford’s Kyle McEnery shares his approach to meeting the entrepreneurs building the future – including his encounters with AppLovin, Anthropic, NVIDIA, Roblox and Reddit. Background: Kyle McEnery is an investment manager in our Long Term Global Growth Team (LTGG) and previously led Baillie Gifford’s Artificial Intelligence Research Project. In this conversation, he tells host Leo Kelion why AI’s ever-increasing capabilities make this one of the most exciting times to be a growth investor, and how leadership and culture act as signals in the noise to help identify companies with the greatest long-term growth potential. In addition to discussing which of the firms enabling and using today’s language-based ‘frontier’ AI models are leading the pack, he explains how efforts to understand and simulate real-world physics could unlock further progress. Portfolio companies discussed include: Anthropic – developer of the Claude AI models, which excel at coding, among other tasks. NVIDIA – the semiconductors firm whose accelerator chips are powering many of the advances in generative AI. Roblox – the video games platform whose Cube 3D technology allows creators to build objects and environments out of text-based descriptions. AppLovin – the ad-tech company whose AI-first strategy keeps the business lean and nimble. Reddit – the online discussion forum, whose authentic human conversations are gaining in value as a counterpoint to AI-generated output. Resources: AI and the future of everything: a long-term perspective Anthropic: why we are backing the AI frontrunner Long Term Global Growth Strategy (institutional investors only) LTGG philosophy and process (institutional investors only) Private companies: from Anthropic to Zetwerk The forge of intelligence: exploring the rise of physical AI Short Briefings on Long Term Thinking hub Companies mentioned include: Alphabet/Google Amazon Anthropic AppLovin Horizon Robotics NVIDIA Reddit Roblox Tesla Timecodes: 00:00 Introduction – Dartmouth College’s artificial intelligence workshop 01:50 From quantum to AI via asset management 02:50 Creating and then culling a machine-learning initiative 08:05 ChatGPT’s wake-up call 10:35 Exceptional companies at the dawn of generative AI 12:10 Anthropic’s appeal to business customers 14:55 A winner-takes-all opportunity? 17:05 Dario Amodei and the scaling laws 19:10 NVIDIA’s foundational role in neural networks 22:55 Making video game items in Roblox with AI 25:00 AppLovin – a company built for the next era 26:55 Reddit’s valuable conversational communities 29:35 World models, spatial AI and the physical world 32:35 Staying open-minded and humble 33:35 Book choice Glossary of terms (in order of mention): Generative AI: AI systems that create new content such as text, images or code rather than just analysing data. Machine learning: AI techniques where systems learn patterns from data rather than being explicitly programmed. End-to-end, systematic (investment strategy): Fully automated, with decisions made by predefined rules rather than human judgement. Agentic AI: AI systems that can plan and carry out tasks autonomously rather than just responding to prompts. R&D: Research and development. GPT: OpenAI’s models, which power its ChatGPT chatbot. Natural language processing: AI that enables computers to understand and generate human language. Token: A chunk of text, such as a word or part of a word, used by language models. Foundation models: Large AI models that can handle a wide variety of tasks. Know your customer (KYC): Financial checks used by banks to verify customers’ identities and risks. Scaling laws: The idea that AI performance improves predictably as models, data and computing power increase. Compute: The processing power required to train and run AI models. Jevons’ paradox: The counterintuitive idea that efficiency gains can increase, rather than reduce, overall usage. CUDA: NVIDIA’s software platform for programming its chips for high-performance computing. Jensen: Jensen Huang, NVIDIA’s co-founder and chief executive. Metaverse: Shared virtual worlds where people interact, create and play online. Large language models (LLMs): AI systems trained on vast amounts of text to understand and generate language. Multimodal models: AI systems that can process multiple types of data, such as text, images and video. World models: AI systems that learn how the physical world works in order to predict and simulate it. Embodied AI: AI that learns through physical interaction with the real world, such as robots or vehicles. Imitation learning: Training AI by having it copy actions demonstrated by humans.

December 16, 202528 min

Emerging market companies leapfrogging western rivals

From Pony.ai launching a robo-taxi service during a Shanghai storm to E Ink revolutionising the way supermarkets label their shelves – emerging market companies are in many cases leapfrogging western counterparts. In this episode, investment manager Alice Stretch reveals to host Leo Kelion some of the most disruptive companies innovating at speed in Asia and Latin America. Background: Alice Stretch is an investment manager in Baillie Gifford’s Emerging Markets Equity Team. In this conversation, recorded as part of our annual Disruption Week briefings, she explores some of the growth companies in her portfolios turning constraints to their advantage and reducing friction in their customers’ lives. Companies discussed include: PolicyBazaar – the Indian insurance platform making it easier for people to protect themselves against life’s financial shocks. Nubank – the Brazilian digital lender extending access to banking and credit. Meituan – the food delivery and local services app extending its reach beyond China. MercadoLibre – the Latin American ecommerce and fintech giant expanding into advertising. Mobile World – the Vietnamese conglomerate that has expanded from mobile phones to competitively priced groceries. Sea Ltd – the Singaporean gaming, shopping and fintech group eyeing the possibilities of agentic AI. TSMC (Taiwan Semiconductor Manufacturing Company) – the world’s leading chip manufacturer. E Ink – the Taiwanese e-paper pioneer building on its ebook success to provide supermarkets with updateable price tags and marketers with low-power digital billboards. Pony.ai – the first driverless car company to offer a robo-taxi service in four of China’s most populous cities. Resources: Disruption Week Emerging markets: how we do what we do Emerging markets: from imitators to innovators Emerging markets: the next engines of growth (podcast) Emerging markets in 2050: growth in a changing world Imec Short Briefings on Long Term Thinking hub Companies mentioned include: Amazon ByteDance Chroma E Ink MercadoLibre Mobile World Meituan Nubank NVIDIA PolicyBazaar Pony.ai Sea Ltd Stellantis TSMC Timecodes: 00:00 Introduction – Pony.ai takes to Shanghai’s roads 02:00 The imitators become the innovators 05:10 How PolicyBazaar benefits from not being locked into a legacy system 07:10 Nubank: reducing friction while expanding access to banking and credit 09:25 MercadoLibre’s multi-act expansion leads it to advertising technology 10:25 Mobile World’s move from selling handsets to groceries 11:50 Ways Sea Ltd developed capabilities while operating under constraints 13:45 Sea CEO Forrest Li’s ability to adapt and pivot 15:25 Taking the long-term view and a generalist approach 17:30 Studying the semiconductor industry with the help of Imec and TSMC 19:45 Investing in Chroma and E Ink in Taiwan 21:10 Walmart and other supermarkets adopt E Ink’s updateable price labels 22:45 The case for investing in Pony.ai as a long-term growth investor 24:10 Pony.ai’s cost advantage and international partnerships 25:55 Taking macroeconomic and geopolitical risk into account 27:15 Putting deep knowledge and research to our clients’ advantage

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