The Coffee Can Investor

What if the smartest investing move was simply to stop selling? Author and former CBS News chief Neeraj Khemlani joins CFO Bookshelf alongside his friend and investment expert Matt Ankrum, CFA, to unpack The Coffee Can Investor—a book born from a $5 million gift to three daughters, a century-old coffee can, and one obsessive question: what do 100-bagger stocks have in common?

About The Book

The Coffee Can Investor is published by Columbia Business Press—a deliberate nod to Benjamin Graham’s The Intelligent Investor. Written by Neeraj Khemlani (former 60 Minutes producer and media executive) with insights and guidance by Matt Ankrum (CFA charterholder and former Janus analyst), the book blends serious financial research with an intensely personal story: Matt’s decision to invest $5 million of his own money into a concentrated portfolio of exceptional businesses for his three daughters, designed to compound over 30 years or more.

The result is a book that does what few investing books manage—it informs, inspires, and entertains. Mark describes the book as going far beyond Good to Great and Rich Dad Poor Dad, with a feel more like The Education of a Value Investor.

The Coffee Can: Origin Story

The concept traces back to a 1984 article by Robert Kirby in the Journal of Portfolio Management. Kirby managed money for a Los Angeles heiress whose husband secretly mirrored every stock purchase Kirby recommended—but never sold. The husband stored physical stock certificates in a coffee can and let them sit undisturbed for years.

When the husband passed away, his wife discovered the can. Kirby examined it and found a remarkable result: the husband’s untouched portfolio significantly outperformed the managed account. One position—Xerox—had grown more than 100-fold from a $5,000 investment. At the end of the article, Kirby issued an open invitation for someone to repeat the experiment.

Matt Ankrum accepted that invitation—with a twist. Instead of simply buying and holding whatever came along, he would study what all 100-bagger stocks have in common and build a portfolio specifically designed to find the next ones.

The Five E’s: Stocks for the Long Haul

Matt’s analytical framework for identifying exceptional long-term holdings evolved through his 100-bagger research into what he calls the 4E Framework—with a fifth E added during this conversation by Mark, with Matt’s blessing.

E1: Essential

Is the product or service truly essential to the customer? Matt connects this directly to one of the study’s most striking findings: 76% of 100-bagger companies had recurring or repeatable revenue. Essentiality is the reason why.

E2: Excellence in Operations

Exceptional businesses don’t just have good ideas—they execute. This E examines what operational excellence looks like in the companies Matt studies and why it matters for long-term compounding.

E3: Enduring Competitive Advantage

Can the business protect and grow its position over decades? Matt references Hamilton Helmer’s Seven Powers as essential reading on this topic—specifically the distinction between competitive advantage and competitive power.

E4: Entrepreneurial Management

Matt draws a sharp line between missionary leaders and those simply managing for near-term results. Axon Enterprises and its CEO, Rick Smith, are cited as a vivid example of what mission-driven leadership looks like in practice.

E5: Extraordinary (proposed by Mark)

Mark proposed adding a fifth E during the conversation—and Matt gave his blessing, with an important caveat. For investors with a 30-year horizon, hear what Matt says about how this E stacks up against essentiality.

Key Research Findings from the 100-Bagger Study

• 68% of 100-bagger companies (IPO’d since 1980) were B2B, not B2C—counterintuitive for most retail investors who think of Apple and Nike.
• 76% had recurring or repeatable revenue streams—the financial fingerprint of essentiality.
• A 100x return over 30 years implies approximately 16.6% annualized growth—roughly double the long-run market return.
• Held long enough, the returns of the business define the returns of the stock (Charlie Munger).

Portfolio Construction

• The coffee can portfolio represents ~10–20% of Matt’s total portfolio. The balance is held in index funds.
• Matt targets approximately 20 names across different industries—enough for meaningful diversification without “diluting genius” into your 100th-best idea.
• Research behind each holding runs 30–45 pages, including a pre-mortem: what would cause Matt to change his mind?
• Each company is tracked via three key metrics, unique to that business—a framework Neeraj describes as showing “what makes Matt’s eyes go big.”
• The time horizon begins at 30 years, the minimum to define exceptional. The ideal is forever.

Mistakes & Hard-Won Lessons

Chapter 14—one of the most candid chapters in the book—deals honestly with mistakes. The most instructive: Fastenal.

In 1998, as a young analyst at Janus, Matt correctly identified that Fastenal would miss earnings estimates. He sold the stock; it dropped 55%. He looked like a hero. But from the point of sale through 2023, Fastenal went up 19-fold while the market returned roughly 4x. That single decision likely cost the fund more in long-term value than almost any other. The lesson isn’t just to hold—it’s that selling right doesn’t mean re-entry is easy. Matt never bought back in.

The book also covers what to avoid: commodity businesses that don’t control their own destiny (oil being the prime example) and geographies with structural governance risks.

Meaningful Quotes

“Held over the long enough timeframe, the returns of the business will define the returns of the stock within that timeframe.” — Charlie Munger (cited by Matt Ankrum)

“Volatility, when you own individual stocks, is actually a feature of the process, not a bug.” — Matt Ankrum

“In the short term, the market is a voting machine, but in the long term it’s a weighing machine.” — Ben Graham (cited by Matt Ankrum)

“You have to allow it to happen and allow it to unfold, and you have to allow for patience.” — Neeraj Khemlani, on compounding

“No bad business over the long term ever makes an exceptional stock. They just don’t.” — Matt Ankrum

“If you really have a great company that you have strong conviction in, why would you want to diversify deeper into something you have much less conviction in?” — Matt Ankrum, on diluting genius

“The best stories are usually from people who don’t even realize they have a story, and you have to pull it out of them.” — Neeraj Khemlani

Books & Resources Mentioned

• The Outsiders – William Thorndike
• 7 Powers – Hamilton Helmer
• Investment Biker – Jim Rogers
• Build – Tony Fadell
• Power and Prediction – Agarwal, Gans & Goldfarb
• A Brief History of Intelligence – Max Bennett
• The Camera Never Blinks – Dan Rather
• Berkshire Hathaway Annual Letters
• The Coffee Can Portfolio – Robert Kirby

About the Guests

Neeraj Khemlani

Neeraj Khemlani is a media executive who spent more than a decade as a producer at 60 Minutes, covering stories from the collapse of the Soviet Union to the Cali Cartel. He later served in senior leadership at Hearst, overseeing entertainment cable networks, and where he saw the company shift capital allocation towards B2B media assets, including Fitch Ratings. The Coffee Can Investor is his first book.

Matt Ankrum, CFA

Matt Ankrum passed all three levels of the CFA exam in consecutive years. He began his career at Janus Capital in 1996, riding the dot-com boom and learning hard lessons from its collapse. He has since worked as a head of strategy for a Fortune 500 company, co-founded a fintech SaaS business, and served as CEO of a brain neuro-rehabilitation company before returning to investment management. The coffee can portfolio is funded with $5 million of his own money and invested for his three daughters.

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