Sardar Biglari – A person to watch

A post on the Gannon on Investing blog alerted me to a guy named Sardar Biglari. He’s a 29 year old who started an ISP company when he was in college, then read about Buffett and realized that — qua investor — he does not want to be in an unpredictable business. He now runs The Lion Fund (hedge fund).

I’m very wary of smart talkers. Over the years, I’ve learnt that the wolf-like car-salesmen types are not the ones to worry about. The dangerous operators come in sheep’s clothing. The dangerous ones appear completely genuine and different, until you’re checking your wounds. So, out of curiosity, I read the one interview that I could find, and what was available on the site of Western-Sizzlin a company Biglari recently took over, and some stuff in the press.

Aside: I would have liked to read Biglari’s letters to his investors, which were public until recently, but it turn out that someone commented to his company that, since he runs a hedge fund, and since hedge funds aren’t supposed to solicit investments from the general public, putting his letters on the site might be construed as an illegal solicitation. In other words, my bloody government is trying to protect me from being tempted to invest in The Lion Fund, even though they already have a rule that prevents anyone with less than $1 million of net worth from investing in such fund. Oh, the tangled web of socialism! (I’ve emailed them asking if I can be given access.)

Anyhow, back on story: so far, everything adds up with this guy and the typical warning flags (things said, ways in which said, things left unsaid). In fact, I’m sufficiently convinced to have invested a small sum of money in Western-Sizzlin, where Biglari is Chairman.

Update (Oct 18, 2006): I should have added that I like the way Biglari is planning the new financing for Western-Sizzlin, using rights shares instead of debt. All too often, take-over firms will bring their own money in the form of convertible debt to the new company that gives some shareholders better treatment than others. The rights share way (or a debt from a truly unrelated third-party, if that makes sense) indicates a sense of fairplay.