Management interviews: the most underdeveloped skill in investing | Ross O'Toole

Summary

• Ross O’Toole wrote Breaking the Script because in 25 years and more than 500 investment books read, he found nothing in the public domain on investor-management interviews—despite them being “a large part of our job” for fundamental investors. He worked at four or five asset managers where the skill was never formally handed down, so he framed the book as the reference guide he would have wanted coming out of college.
• His most honest admission: asked whether management interviews generate alpha or self-delusion, “I don’t actually know what the answer is.” Investors “probably overestimate our ability” to read management, but techniques may elicit better responses. The biggest payoff is longitudinal: interview the same team quarter after quarter and build a credibility baseline over time.
• A core tactic is to frame questions with “what” rather than “why.” “Why did you miss results?” and “what were the reasons your results didn’t meet expectations?” are “really the same question, but the why creates defensiveness”—especially useful in the contentious, stock-down-50% interviews event-driven investors conduct.
• The value of interviews is sector- and situation-dependent: for a coal company at a 50% NAV discount, the interview may matter less because “management is definitely not responsible for commodity prices”; for early Meta, understanding Zuckerberg’s 3-to-5-to-7-year vision could matter much more. Ross notes that Google went down on the day it went public, while Facebook fell from roughly $36 to $18 amid fears about its desktop-to-mobile transition.
• On AI, Ross wonders whether the book could become outdated quickly because language models can already generate interview questions from transcripts; Andrew counters that AI “decreases alpha from some skills and really amplifies alpha from another.” Great interviewing can unlock unique data, making the skill more valuable if the conversation is captured. They discuss a likely future of recorded meetings; Ross warns against outsourcing judgment to LLMs and cites Chanos’s “inside out, not outside in” approach.
• Asking for examples is a double-edged sword: Andrew says some of his biggest losses involved companies whose one great customer example may have been their only meaningful user. Ross’s answer is to demand the negative example too—“tell me about a customer that you lost”—because management rarely volunteers what is going wrong. His framing: “pessimists sound smarter but optimists sort of own the future.”
• Question craft beats rote question lists: in all likelihood, 80% of investors ask the same questions and receive prepared answers. Ask familiar questions in an unfamiliar form, anchor with your own number (“I think your margins are going to be between 25 and 30%—tell me why I’m wrong”), and structure the interview as an arc: build rapport with easier questions before raising the contentious issue. Andrew’s favorite question, also in the book: “What are other investors asking that I should be thinking about?”

Deep dive

1. The most underdeveloped skill has no literature

• Ross’s origin story: 25 years investing, more than 500 investment books read, and “there really isn’t anything in the public domain” on the investor-management interview—plenty on valuation and moats, nothing on how to conduct the conversation that is “a large part of our job.” Across four or five asset managers, the skill was never handed down; a running list of questions slowly became a book of principles and tactics. “It’s a book I wrote for myself.”
• Andrew’s endorsement comes with a use case: it would go “right to the top” of what he’d hand an intern transitioning to leading interviews—and he spent the whole read applying it to podcasting.
• Andrew’s own case for why interviews matter even to skeptics: a management interview last year “set my hair so much on fire that I instantly published a public letter to the board.” A bad interview is a red flag that can save you from disasters—“half the game is avoiding the downside.”

2. Are we reading management, or being read?

• Andrew’s worry: management teams are skilled sellers who see more investors than he sees management teams—“if you don’t know who the patsy at the poker table is, you’re probably the patsy.” Ross’s answer is unusually candid: “I don’t actually know what the answer is.” An industry of alpha personalities wants to believe it has good judgment; “we probably overestimate our ability.”
• But techniques may still elicit better responses. Ross’s example is Howard Stern’s “poking”—provocative questions that break down the wall—plus the logic of repeatedly asking for a story in different ways. Someone who is lying may eventually tell it inconsistently.
• The strongest benefit is longitudinal: “if you can talk to the same management every quarter year after year, you’re going to start to discover whether they’re more credible or not because you’re going to have a baseline.” Ross also says the interview is only one tile in the mosaic—married to financials, expert calls, and sell-side or other analyst conversations—not a standalone verdict, especially given sector biases such as trusting a coal CEO more than a medical-device CEO.
• The point is not only the numbers: Ross also wants to learn whether the CEO or CFO thinks logically and is a good person, because businesses are run by people.

3. “What” beats “why”—and silence beats both

• For the contentious, stock-down-50% interviews of event-driven investing, Ross’s core mechanic is: “why did you miss results?” versus “what were the reasons your results didn’t meet your expectations?” They are “really the same question, but the why creates defensiveness.” What-framing can preserve rapport while still asking the challenging question; Ross calls it one of the better chapters in the book.
• The tangent worth keeping: 14-year-old Cameron Crowe interviews Kris Kristofferson, gets a weak answer, and freezes into silence. Kristofferson fills the silence, “spilling his guts,” then tells Crowe it was one of the best interviews he’d ever done: “you’re such a great listener.” Create the space and let them talk. Andrew’s version: “STFU”—just stop talking.
• Ross’s caveat: better technique does not necessarily produce better alpha. It can give you a fuller picture and clearer understanding of where management is coming from, but you still have to apply your own judgment.

4. Where the interview matters: coal NAV vs. Zuckerberg’s vision

• Andrew asks whether someone who dislikes management interviews should simply focus on coal. Ross says that in a deep-value, mean-reversion situation—“this company is trading at a 50% discount to its net asset value”—the interview may matter less, since “management is definitely not responsible for commodity prices.” For early Meta, by contrast, Zuckerberg’s 3-to-5-to-7-year vision and ability to position the company in a fast-moving industry could matter more than quantitative answers in the financial statements.
• Both dwell on how non-obvious the winners were. Google went down on the day it went public after its Dutch-auction IPO. Facebook went from roughly $36 at its IPO to $18, while CNBC discussed the stock every day amid fears that mobile would overwhelm its desktop advertising business.
• Andrew’s counterfactual is that, with foresight of the next 20 years except for the winners, he would have interviewed Zuckerberg in 2008 and concluded Facebook was toast because of the coming mobile shift and Instagram. Ross is “not sure” an interview would have solved that, though a good conversation might have helped create conviction that the prevailing news narrative was wrong.

5. Preparation, note-taking, and the AI debate

• Ross’s uncomfortable truth: “the preparation is probably the most important part of the interview.” In an ideal world, assuming you took good notes, you reread them and the last four to eight transcripts before walking in. The ideal setup is a lead interviewer plus a dedicated note-taker, because “your brain isn’t sophisticated enough” to actively listen, plan the next question, and type simultaneously. His confession: “I don’t take good notes”; if asked for specifics afterward, he is “kind of at a loss.” Amazon’s interview process, as he recalls it, used a verbatim note-taker so absent colleagues could read exactly what the candidate said.
• Ross wonders whether the book could become outdated quickly because large language models can take transcripts and notes and generate “five or seven good questions.” Andrew’s counter-thesis: AI “decreases alpha from some skills and really amplifies alpha from another”—a great interviewer generates unique data that no one else has, so the skill could become more valuable if the conversation is captured. Ross foresees a future in which these meetings are recorded.
• Ross says he is glad he was not 22 and coming out of college with LLMs as a first source. He built mental models by reading, and “it’s just too easy to kind of outsource your judgment,” as investors already do with sell-side research. His anchor is Chanos: “work from the inside out, not the outside in”—start with SEC documents, the 10-K, transcripts, and the company presentation before consulting outside opinions.

6. Examples build conviction—and can blow up portfolios

• Andrew’s confession on the “ask for examples” chapter: some of his biggest losses involved companies with a great product story and a great customer example that may have been the only meaningful customer using it. Companies know narrative works; he cites a Meta call highlighting an Indian brand it helped grow by about 95% in a quarter with AI. Ask for an example and “you’ve just teed them up to sell.”
• Ross’s fix: for every positive example, demand the negative—“tell me about a customer that you lost. Why did you lose them?” If attrition is 5%, ask why. His framing: “pessimists sound smarter but optimists sort of own the future,” and in 25 years of transcripts, “rarely do management teams tell you that things are going wrong”—even when they are, they spin it.
• Andrew’s specimen of spin: United Parks & Resorts, which owns SeaWorld and others, blamed poor results on bad weather in 15 of the past 16 quarters. Ross’s counter-move is to ask management to grade its execution versus the external environment on an A-to-F scale over the last four to six quarters, then follow up: “You blamed weather for those 6 quarters. Do you want to reconsider your grade?” Most people overgrade themselves, but a high grade despite repeated excuses “should make you step back.” Ross would rather own teams that admit, “we didn’t execute.”

7. Question craft: activists, silver bullets, and the interview arc

• On interviewing management under activist pressure, Ross routes it back to preparation: tension comes when investors “have a high opinion of their perspective” without understanding the business. Walk in with a rational, well-supported point of view—whether on buybacks, capital investment, divestitures, or strategy—and walk management through the relevant math. If they still push back, that becomes part of your analysis of them. “The dirty little secret of activism” is that activists may provide cover for the board and management to do what they already need to do.
• On the possibly Buffett- or Buffett-adjacent “silver bullet” question— which competitor would you kill, or which would you invest in if you could not invest in yourself—Andrew offers a tentative recollection that asking media investors may have pointed to Capital Cities and Tom Murphy. Ross sees it as a useful way to ask about competition differently: “80% of us are asking the same questions,” and management has rote answers ready for “what keeps you up at night?” Asked repeatedly over years, changing answers can help reveal who is gaining ground and who is falling behind. Andrew cautions that for 15 years every airline might have named Spirit as the competitor to kill; treating that as a bullish disruptor signal could have led an investor badly astray, since he says Spirit would have gone bankrupt and liquidated.
• Ross speculates about a Hot Ones-style setup with spicy wings to knock management out of its comfort zone. Andrew’s practical closing point is to structure the meeting as an arc: open with a softball on strategy or culture, build rapport, and crescendo to the contentious margin question once the relationship is established. Anchor rather than ask only open questions: “When I do the math, I think your margins are going to be between 25 and 30%—tell me why I’m wrong.” Andrew’s page-41 favorite, also in the book: “What are other investors asking that I should be thinking about?”