David Trainer

This Company Is Giving Average Investors Exceptional Information

The world of investing has shifted radically over the past two decades, with average investors gaining more and more ground on the professionals. But even with all the tools and services available to everyday players in the market, a simple truth remains for most investors: You don’t know what you don’t know.

David Trainer

David Trainer, CEO of New Constructs LLC, is one of the few people who does know the things most investors don’t, and he’s lookingΒ to level the playing field.

β€œI always had interest in how to analyze a company. I learned early on in my finance career the key information to really understand that is in footnotes,” Trainer says, referring to the footnotes that go with company filings.

β€œI built an early career in Wall Street [making] these higher-quality, higher-integrity models. At the same time, I had a front-row seat to how the sausage is made with respect to IPOs and all kinds of other things that Wall Street is selling.”

Trainer was working on Wall Street before, during and after the tech bubble in the late β€˜90s and early 2000s. He specialized in scrutinizing the minutia of company filings to find the information companies tried to hide (or at least reduce the visibility of in complex footnotes).

That information tells a truer story and allows investors to make decisions without the influence of a carefully constructed appearance created by those doing the filing. For one example, in pre-IPO filings, companies can use accounting loopholes to hide massive expenses in stock compensation, giving an enhanced appearance of profitability to spur investment.

β€œFleecing the pockets of many to line the pockets of few was just kind of done with scale on Wall Street. In a lot of ways, not all the ways, but sometimes,” he says. β€œBecause Wall Street is able to sprinkle in some good advice in there every now and then, it’s hard to know when they’re giving you good stuff or when they’re giving you bad stuff.”

But the work was highly specialized, and during the tech boom, Trainer realized it wasn’t an area that would be easily accessible to the public.

β€œI was trying to hire people during the tech bubble, and I noticed it was extremely difficult to hire people. Their options were; β€˜you can come work for David Trainer and read annual reports, or you could go work for the tech team, work for (legendary tech investment banker) Frank Quattrone and do a tech IPO a week and make 10, 100 times more money. You decide. What sounds better? What’s more interesting?’”

That led Trainer to a simple realization: If the average investor was ever going to get on fairer footing with the insiders, someone needed to make it easy for them. The problem was, he was one of the only people on Wall Street who had the knowhow.

β€œI realized If I didn’t create technology, if I didn’t create some system to shine a light in the dark corners of all these filings, if there wasn’t some automation around it, no one would do it,” he says.

New Constructs was born out of that realization, offering the same detailed research to average investors as that offered to hedge fund managers. In addition to its services, New Constructs also offers investment advice and information in the form of blog posts, podcasts and videos on it’s website.

Those offerings and the equalizing information he offers are all part of a larger operating philosophy for Trainer; one driven by a noble idea.

β€œTo me, the American dream is being able to earn a living while making the system better. When the two are aligned, I think it’s a special thing,” he says.

β€œThere’s a huge opportunity here for me to improve the integrity of the capital markets and also earn a good living. That’s a great thing to be able to do. I’m going to make the system better, and the fact I’m incentivized to make the system better is a great way to honor the way our country is set up.”

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