Becker Private Equity & Business Podcast: "Astera Labs: It’s Better to Be Lucky Than Good"
Host: Scott Becker
Release Date: July 22, 2025
Episode Title: Astera Labs: It’s Better to Be Lucky Than Good
Introduction
In this episode of the Becker Private Equity Podcast, host Scott Becker explores the intriguing concept of luck versus skill in investment decisions through his personal experience with Astero Labs. Titled "It’s Better to Be Lucky Than Good," Scott delves into the nuances of holding an investment without conviction and the unpredictable nature of market movements.
The Accidental Investment
Scott begins by narrating how he inadvertently acquired shares of Astero Labs:
"I happened into shares of Astero Apps through a distribution from a hedge fund that I'm invested in. Of course, I know absolutely nothing about Astero Labs." [00:15]
This unexpected acquisition sets the stage for the central theme of the episode—investing without informed conviction.
The Dilemma: Hold or Sell
Faced with this unforeseen investment, Scott confronted a critical decision: to hold onto the shares or sell them. His rationale for holding was not based on thorough analysis but rather on fear of regret:
"I held my position in Astero Labs not out of any conviction or thought about it, but fear that it would do great and I'd feel stupid for selling it." [00:40]
This highlights a common investor psychology where emotions can override rational decision-making.
Performance Overview
Scott provides a candid update on the performance of Astero Labs since his acquisition:
- Initial Gains: The shares appreciated by 100% since he received them.
- Current Status: Despite the initial surge, the stock is down by 17%.
- Recent Volatility: The stock experienced a 20% jump over two days, followed by a 10% decline the next day.
Scott reflects on these fluctuations with a mix of excitement and trepidation:
"It's up 100%. [...] It jumped two days ago, 20%. And I was so excited thinking, my God, how smart am I? But of course, it's down again today about 10%." [01:05]
Luck vs. Skill: An Honest Reflection
The crux of the episode centers on whether Scott's investment outcomes are a result of luck or his own investment acumen. Despite the impressive gains, Scott attributes his success to luck rather than informed decision-making:
"Is it to be lucky or good? Probably lucky in this case is I had no real intelligence behind this choice." [01:25]
This admission underscores the unpredictable nature of the stock market and the dangers of investing without proper research or conviction.
The Importance of Investment Conviction
Scott reiterates a fundamental principle he advocates for in investing:
"I typically preach on any investment you make, you should have a conviction around this investment. I had none around Astero Labs." [00:35]
This statement serves as a cautionary reminder to investors about the risks associated with holding stocks purely based on fear of regret rather than solid investment theses.
Insights and Lessons Learned
Through his experience with Astero Labs, Scott imparts several key insights:
- Emotional Investing is Risky: Holding shares out of fear can lead to suboptimal investment decisions.
- The Role of Luck: Sometimes, investments perform well due to factors beyond an investor's control.
- Importance of Research: Making informed decisions based on thorough analysis is crucial for long-term investment success.
Conclusion
Scott wraps up the episode by acknowledging the role that luck played in his investment journey with Astero Labs. While the gains were substantial, the lack of conviction and understanding could have led to significant losses had the market not favored the stock.
"It's better to be lucky than good. [...] Probably lucky in this case is I had no real intelligence behind this choice." [01:25]
He emphasizes the importance of building a portfolio based on informed decisions to mitigate reliance on luck.
Key Takeaways:
- Accidental Investments: Can lead to significant gains but come with inherent risks if not backed by conviction.
- Emotional Decision-Making: Holding investments out of fear of regret rather than strategy can be detrimental.
- Luck vs. Skill: While luck can influence outcomes, informed and researched investments are more sustainable.
Notable Quotes:
- "I held my position in Astero Labs not out of any conviction or thought about it, but fear that it would do great and I'd feel stupid for selling it." [00:40]
- "I typically preach on any investment you make, you should have a conviction around this investment. I had none around Astero Labs." [00:35]
- "Is it to be lucky or good? Probably lucky in this case is I had no real intelligence behind this choice." [01:25]
Thank you for tuning into the Becker Private Equity & Business Podcast. Stay tuned for more insightful discussions on private equity and business strategies with Scott Becker.