Company Touch Tracker
This quarter our team engaged with 441 companies across the world, putting our trailing 12-month company touches at 1,711.
In Q2, team members traveled domestically to Colorado, Minnesota, and Nevada with multiple trips to New York. Internationally, team members traveled to Brazil, UK, India, Switzerland, Australia, China, Taiwan and South Korea and interacted, by phone, with companies in 27 other countries and 17 other states. We track these interactions and share them on our Company Touch Tracker1.
China Visit
This quarter, Tyler Glauser, Portfolio Manager, traveled to China and Korea with colleagues, Liping Cai, PM, Daniel Xu, Research Analyst, Rafael Semnario, Analyst Intern, and Angelina Mackay, Analyst Intern. Here are some of his thoughts the Chinese markets:
I do my best thinking while jogging. Body completely engaged, blood flowing, heart pounding, mind wandering. I have found that to be a formula for meaningful preparation for a long day of meetings in a foreign country. One of my favorite things to do while traveling is to run along the best waterfront trails in any given city. A few highlights for me over the years include Sea Point Promenade in Cape Town, South Africa, the Hudson River Greenway in New York City, USA, Tamaki Drive in Auckland, New Zealand, Lungegard Lake in Bergen, Norway, Copacabana and Ipanema beaches in Rio de Janeiro, Brazil, and Marina Bay in Singapore.
The best way to explore a new city is to wake up super early in search of a long, scenic running path. Recently, in Shanghai, I started the day with a 7-mile run along Nanjing Road and the Bund (the iconic luxury shopping and waterfront promenade district) in Shanghai. It was 5:30 am and the city was just waking up. It had been raining and the air was wet and heavy. I spent some time racing an old cargo ship along the water until I could not keep up with it anymore. It was a beautiful way to start the trip.
It is interesting to consider how China has evolved in recent history. I first visited Shanghai more than a decade ago as a university student on a summer school trip. Shanghai was the busiest container port in the world; the gateway for Chinese goods to be sent to the world. International companies were taking advantage of the Free-Trade Zone and establishing offices in the area. The Chinese A-Share market was expanding, allowing more foreign investors access to Chinese-listed companies. The city was full of foreign faces and languages at that time.
After Covid-19 lockdowns ended, I spent several months living in Beijing while my wife, who is a singer, worked locally at Universal Studios. I traveled to many cities in China during that stay, and the lack of foreign faces and languages was striking. What was once a hub of global tourism and business had been reduced to an isolationist empire.
On my most recent trip, I noticed a few tourists from outside China as I ran along the Bund. As we visited with management teams throughout the week, we heard anecdotal evidence regarding inbound tourism and business showing signs of life for the first time in years. Inbound tourism to Shanghai dropped by over 80% from 2020-222. Beginning in 2025, tourism in Shanghai has seen a sharp recovery, with levels surpassing the pre-pandemic numbers. Could tourism coming back to Shanghai be a sign that the macro will finally start looking up in China?
Global investors have spent three years underweight China, driven by the real estate overhang, soft consumer confidence, and geopolitical tensions. These concerns are legitimate, and management teams we met with did not sugarcoat the backdrop. One executive told us bluntly that ordinary people are struggling more now than they did during the COVID years, and that brands who assume “we survived the pandemic, so we’re set” are making a dangerous mistake. We met with 8 companies over our 2-day visit to Shanghai. None of the management teams we met were planning for a consumer demand rescue in the near-term. And yet, not one of the companies was lowering its growth ambitions. What emerged instead was a consistent picture of a consumer who is bifurcating – ruthlessly value-seeking on functional purchases while spending freely on small things that deliver emotion, identity, or experience. One executive put it best: the younger generation is hunting for “emotional value,” pointing to the Labubu collectible craze3 as the phenomenon every brand in China is now trying to decode. A toy that costs less than a coffee, a facial oil rooted in Chinese botanical tradition, a hotel pillow you love enough to take home – consumers are spending where they find value either through exceptionally low prices or through emotional connections.
This strong commitment to emotional value cuts both ways, however. One executive mentioned how they cannot get young people to work in the back kitchens of their drink stores because they want to work in the front of the stores so they can connect with people and serve customers. This has led to a great deal of wage inflation, similar to what we have seen in the US since COVID with the new generation refusing to accept some job functions (think of the staffing shortages in restaurants in the US).
Another observation that was reinforced on this trip: for years, “premium” in China meant “foreign.” That era appears to be ending. For some time, we have seen domestic cosmetics brands taking share from foreign brands. A strong sense of Chinese nationalism is helping to fuel this as well as genuine improvements in the product quality of the domestic players. Abroad in Korea and other Asian countries, Chinese still means “cheap” and Western still means “quality.” But within China, that is shifting rapidly and perhaps we should not take it as a given that it will remain the case in other Asian nations for too long.
Douyin (Chinese Tik Tok) is driving explosive growth for many of the brands that we met with. But as I heard one insightful executive say recently, “Attention is rented, but brand equity is earned.” Tik Tok represents exactly the type of channel where you can rent attention to drive explosive growth in short periods of time. But brand equity comes from trust which can take years to build. Brands must serve their customers consistently and provide emotionally positive experiences.
During these meetings, I kept returning to an idea I have been considering since hearing a former OpenAI executive speak earlier this year. In 1930, John Maynard Keynes predicted that within about a century, technology would largely “solve the economic problem,” leaving humanity with the harder task of learning to live wisely, agreeably, and well. Nearly one hundred years later, AI is commoditizing cognition much as the Industrial Revolution commoditized physical labor. Research, code, content, and service are all moving toward near-zero cost. When functional output becomes cheap and abundant, meaning becomes scarce. In the investment world, nowhere is meaning more abundant than in the Consumer sector, my area of coverage. Shanghai reinforced this idea: every management team we met, whether selling toys, tea, facial oil, or a night’s sleep, was ultimately pursuing the same goal—making customers feel something an algorithm cannot replicate.
What does this all mean for our portfolios? It’s still not clear that things are off to the races in China, but I am inclined to believe that the rock-bottom valuations we are seeing for Chinese Consumer companies have overshot, and that we have great opportunities to selectively allocate to the brands and companies that are creating emotional value for their customers. We are hopeful that consumers in China will begin to spend their money more freely, and the market will return to valuing companies based more closely with their fundamentals. I do not know when it will happen, but when it does, I imagine that many investors who may be avoiding Chinese consumer equities will find themselves like me, on the Bund that morning, chasing a cargo ship that they just cannot quite keep up with.
It is a very exciting time to be a global investor.
[1] Grandeur Peak Global Advisors – About Us – Global Footprint, https://grandeurpeakglobal.com/global-footprint/
[2] “Shanghai takes actions to welcome rising inbound consumption”
[3]”The Rise of Labubu: Behind the emotional economy are the emotions of the economy” April 23, 2026