Nomad Investment Partnership Letters (2001–2014)

Nick Sleep and Qais Zakaria (often “Zak”) ran the Nomad Investment Partnership from September 2001 until they liquidated and returned capital in 2014, compounding at roughly 20% annualized before fees across that span. Written every six months for partners, the letters track their shift from deep-value “cigar butt” picking toward concentrated, nearly permanent ownership of businesses that share scale savings with customers. The IGY Foundation later published this approved full collection (lightly edited for privacy) so readers would use the canonical PDF rather than circulating bootlegs.

18 January 2002 — Inaugural letter. Nomad had just launched (investing from 10 September 2001) and was already up about 10% versus a modest index gain, framed strictly as absolute-return work. Sleep sketches a genuinely long reporting cadence—annual and interim letters plus Global Investment Reviews—and warns that more frequent NAV chatter would be counterproductive. Early holdings concentrate in media/publishing and hotels/casinos/resorts, with International Speedway and Thailand’s Matichon offered as miniature case studies of franchise quality bought at a discount.

30 June 2002 — Interim report. Results are still short-dated, but Nomad is holding up better than world equities in a weak tape, in the Buffett-partnership pattern of looking relatively good when markets are soft. Sleep stresses patience as a competitive advantage and asks partners to ignore near-term noise. Portfolio stats underscore concentrated sector bets across many narrowly labeled Bloomberg industries rather than closet indexing.

31 December 2002 — Year-end report. A down second half leaves absolute returns only “fair,” even while Nomad beats a badly falling index without leverage, shorts, or derivatives. Sleep owns the Conseco wipeout in public and refuses window dressing. He sorts the book into hard-to-copy franchises, asset-backed situations, and deep-value workouts, and digs into Stagecoach’s repair story and a growing Costco stake.

30 June 2003 — Interim report. Partners’ fast approval of an unlisted-equity policy lets Nomad buy depressed Weetabix, which jumps roughly 20% from cost and reminds everyone that client temperament is part of the edge. Sleep refuses to forecast short-term prices; he only claims autumn 2002 quotations were so low that long-term success looked hard to avoid. Relative advantage versus the MSCI World is already large.

31 December 2003 — Annual letter. Sleep prefers multi-year compounded scorecards over neat annual consistency theater, because managers control being right more than when they are right. He bans financial exotica and jokes that any request to use it should trigger redemptions. The letter shifts from stock stories to partnership principles: honest mistake analysis, how they size ideas, and how growth of assets must not dilute price-to-value discipline.

30 June 2004 — Interim letter. Near-index trailing returns invite a dig at closet indexers; Nomad still charges no performance fee when there is no performance. With assets past about $100m after drawing the subscription queue, the partnership is declared closed by default, reopening only when prices create room. Capital allocation and partner quality beat asset gathering as explicit priorities.

31 December 2004 — Annual letter. Approaching the first five-year measuring stick, Sleep warns against extrapolating the strong cumulative record. Unlike the late-1990s barbell of bubble tech versus neglected value, he sees valuations evenly elevated and reinvestment risk high—especially with the fund closed. A long Costco section reframes “growth versus value” as studying the compounding engine, including scale savings passed back to members.

30 June 2005 — Interim letter. A meager ~2% price gain still accompanies a better partnership price-to-value ratio after adding to cheap names—the outcome Sleep wants partners to cheer. He cites social-proof cartoons and Cialdini to argue that following the crowd is the opposite of Nomad’s job. Ignore NAV theater; watch the discount to intrinsic value.

31 December 2005 — Annual letter. Five calendar years in, roughly tripling the starting dollar before fees still comes with a slightly annoying index-matching year given Nomad’s concentrated, eclectic book. Sleep contrasts that luck with Bill Ruane’s brutal early Sequoia stretch. Education of partners about process matters more than pigeonholes like “value” or “growth.”

30 June 2006 — Interim letter. First letter on Sleep, Zakaria & Co. letterhead during the handover out of Marathon: Marathon still owns performance reporting until early September, while Zak and Sleep explain the pending independence. Much of the note is operational—refundable performance-fee design that vendors cannot cookie-cut—and a reminder to read the transition letter and prospectus carefully.

31 December 2006 — Annual letter. Independence succeeds as a firm-building year even while Nomad trails the quoted index; Sleep insists the index is context, not a risk-free home. He catalogues index-relative pathologies: fake diversification, forced opinions outside the circle of competence, and marketing gravity. Philosophy and client selection matter more than one soggy relative year.

30 June 2007 — Interim letter. Strong recent compounding looks “normal” inside a wide short-term distribution, yet still above Nomad’s multi-year average—so partners should mentally bank excess for leaner stretches. Sleep dwells on the feedback-lag problem: traders get instant lessons, long-term investors risk eating hemlock because payoffs arrive years later. Stoic indifference to quarterly zigzags is part of the method.

31 December 2007 — Annual letter. Sleep re-reads old letters and finds them heavier than investing’s simple core, blaming the urge to sound newly impressive. The deeper thread is destination thinking and business quality over cleverness. Cumulative dollars continue to outrun the index without hedge-fund plumbing.

30 June 2008 — Interim letter. A sharp drawdown refunds the performance-fee reserve to partners—an equitable quirk Sleep jokes ruins cocktail-party bragging. Relative and absolute pain are both real; grace under pressure is the request. Index composition curiosity is waved off when vendors want subscription fees to explain their own benchmarks.

31 December 2008 — Annual letter. Crisis-year NAV is ugly (~−45%), yet Sleep redirects attention to an improved price-to-value ratio and deferred returns. He reprises the 2005 psychology point: brains overweight immediate gains versus larger delayed ones. Partner behavior in the trough is treated as part of Nomad’s moat.

30 June 2009 — Interim letter. A Darwin bicentenary prologue models intellectual humility—state conclusions while admitting contrary facts exist. The investment counterpart is revising mental models without performative certainty. Recovery gains appear, but process talk stays above victory laps.

31 December 2009 — Annual letter. A huge rebound year (~+71%) restores multi-year context: since inception Nomad has roughly doubled the index dollar after fees on the quoted yardstick. Sleep credits partners twice for adding capital and staying calm when it counted. Results still come from ordinary long stock picking, not exotica.

30 June 2010 — Interim letter. After marking a decade of letters, Sleep turns to comparative advantage and how some cultures keep winning. Scale-economics-shared names remain the spine of the book. Net compounding since inception still dwarfs the average share on their preferred long horizon.

31 December 2010 — Annual letter. Another strong year prompts an explicit plea: mentally move surplus from fat years into thin ones before making subscription or redemption decisions. Destination businesses and customer-reciprocity models dominate discussion. Index tables stay for orientation only.

30 June 2011 — Interim letter. Zeckhauser’s behavioral-finance aside (someone buying Zimbabwean paper at a fraction of NAV) frames how unusual bargains look to consensus brains. Sleep keeps stressing a few simple advantages compounded for a long time over omnibus macro opinions. Concentration in trusted cultures continues.

31 December 2011 — Annual letter. A down year versus soft markets becomes a story about opaque institutions and hard conversations with management, not about reinventing the portfolio. Scale-shared retailers and internet platforms still define most of the risk. Partners are again asked to judge Nomad only over very long spans.

30 June 2012 — Interim letter. Attenborough and “information as food” set up how Nomad chooses what to consume carefully. Sleep repeats that indices barely occupy their minds; pick another benchmark if you must, but keep the horizon long. Founder-led cost cultures (Costco’s basis-point obsessiveness, Amazon’s vending-machine light bulbs) illustrate identity-level thrift.

31 December 2012 — Annual letter. Daily work is still slippers, annual reports, and re-analysis of the same compounding machines. Sleep generalizes that Nomad businesses are often founder-run with low-cost identities rather than financial-engineering stories. Calendar strength is noted without inviting extrapolation.

30 June 2013 — Interim letter. Trailing and since-inception figures again show a wide annualized gap versus the average share. Continuity of the index column is confessed as habit more than conviction. The letter keeps faith with a small set of shared-scale compounders instead of rotating into a new ideology.

31 December 2013 — Annual letter. Sleep marks roughly twenty percent annualized before fees since September 2001—about a ten-bagger on a starting dollar versus roughly a double for the index—and treats that gap as evidence for patience more than personal heroics. He argues regulation increasingly burdens small simple boutiques, revisits hard lessons such as Zimbabwe, and frames twenty-five letters as a high-level record of method rather than a stock tip sheet. Months later Nomad would liquidate; this letter itself does not yet announce the end.