Buyers and Builders

Imagine raising millions for your startup…

A team of 50 and significant revenue…

Then getting FIRED from the same company you started…

Then starting a boring traditional company that generates significant cash flow, so you could buy another company…

And not just one, but 4 companies!!!

And THEN, growing these businesses an average of 65% in the first year post-acquisition.

All this in four short years.

What a WILD story and an even wilder life for 34-year-old Chase.

“It was a condensed MBA – 50 employees. Millions in revenue. Scaling the company at a double- and triple-digit YoY growth rate. I was a 23-year-old clueless entrepreneur trying to keep a ship together… Ultimately, getting fired from my baby.”

Today, Chase is a new man, happy, relaxed, builds a business he never wants to retire from, travels the world with a kid, and Decada Group has 5 companies in its portfolio.

We discuss:

— Why slow growth may be the smartest thing ever d

— The best companies plan for decades

— Having fun daily, and genuinely enjoying building the company vs. arrival fallacy and chasing IRR

— How to grow a business (SMB Growth Playbook)

— 5 step guide on how to grow business by 65% in the first year post-acquisition

Show notes:

00:00 - Intro

00:31 - The wild story of raising multiple rounds of VC and then getting fired from your own company

05:09 - Transforming a profitable lifestyle business into a serious cash cow type business and a portfolio of 5 SMBs

07:05 - Building a holding company by accident. “It was never the idea.”

14:50 - How to make sure opportunities come to you vs. you constantly chasing them

18:48 - The technology revolution is not over, but the heyday is over

23:32 - Overview of the current diversified portfolio of traditional businesses

27:53 - How do they find companies to acquire while having ZERO competition on deals

38:10 - Growing portfolio companies by an average of 65% in the first year post acquisition (How exactly?)

54:51 - Pros and cons of focusing on single business vs managing a portfolio of companies

My full conversation with Chase Murdock, the co-founder of Decada Group — Stream now.

Follow PrivatEquityGuy on Twitter: ⁠⁠https://twitter.com/PrivatEquityGuy

⁠⁠Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small profitable niche businesses: ⁠⁠⁠https://privatequityguy.beehiiv.com/

⁠Chase on Twitter: https://twitter.com/chasemurdock

This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

There's a gentleman who manages a $115 million AUM fund with annualized returns of 35% (before fees) since inception.

And he wrote a 3,150-word letter for those who dream of compounding their money at 20-25% per year over the course of their careers.

1. Your chance of becoming a great investor is 1/50 of 1% or something. If not less… You have almost no chance of being a great investor.”

2. Going to Harvard, Stanford, Wharton or reading every book ever written on investing won't make you a good investor

3. I don’t believe there is a correlation between investment performance and number of books read.

4. Experience is overrated. It’s important but it’s not a source of competitive advantage. If that wasn’t true, all the great money managers would have their best years in their 60s, 70s and 80s. And we know that’s not true.

“There are 7 traits great investors share that are true sources of advantage because they can’t be learned once a person reaches adulthood. Some of them can’t be learned at all, you’re either born with them or you aren’t.”

Show notes:00:00 - Intro

00:43 - Why only very few can compound money 20% for their entire career

05:22 - To protect your investment, you need one of these four sources of economic moats that are hard to duplicate

07:59 - Having advantages over fellow fund managers and individual investors

11:12 - 7 traits that can’t be learned yet true investors who end up compounding at 20% or 25% over their careers ALL have in common

Follow PrivatEquityGuy on Twitter: ⁠https://twitter.com/PrivatEquityGuy⁠⁠

Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small profitable niche businesses: ⁠⁠⁠https://privatequityguy.beehiiv.com/⁠

This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

Ever considered acquiring a profitable, sub $1-5M EBITDA niche business?

So you could spend summers on Lake Como, winters in Aspen, and Saturdays in Las Vegas at the Wynn listening to David Guetta…

Or so you could retire your parents, send your lovely kids to a private school, and buy your wife the BMW convertible she always wanted…

I don't know your exact dream, but owning a business like this makes it all possible.

So... I have something for you.

I believe Jules Brenner of the Industrial Succession Group just shared everything one needs to know when it comes to acquiring a traditional niche business with $1M+ EBITDA.

• How to find a deal?
• How to find co-founders?
• How to raise capital?
• How to pitch investors so they are actually willing to invest?
• How to manage it all post-acquisition?

Ohh.. and I forgot.

He really walks the talk:

• 3 acquisitions
• $20 mil in revenue
• 50% gross margin
• $4 mil in EBITDA

With a goal of reaching $100 mil by the end of 2028…

And maybe (if a few acquisitions go well) $35 mil already by the end of 2024

Most importantly, him being very open and generous with advice, sharing it all without holding anything back.

We discuss:

— Creating a list of companies to be acquired

— How they will reach $100 million by 2028

— 6-7 failed deals, while not losing hope

— How to pitch, structure and present a deal in a way that investors would love

— Deal structure (equity to debt ratio)

— A very good VP of Marketing can do magic for your traditional business

— An agency where people make 100+ cold calls a day to grow their business

00:00:00 - Intro

00:00:41 - A portfolio of industrial companies with 100+ employees

00:05:39 - 2.5 years of research (for example, metal fabrication in the aerospace industry)

00:09:58 - Step-by-step guide to how you pitch your deals so investors want to participate

00:19:02 - “If you paid nothing for a company, would you still buy it?”

00:25:14 - Obvious red flags when looking at deals

00:31:39 - A lot of traditional businesses don't have a CRM or a website and just make a 7-fig from real estate

00:37:17 - The VP of Marketing handles all business development

00:38:02 - The way their deals are structured

00:40:11 - Buying a business so you don't have to rely on an exit

00:41:56 - Selling products to LAX Airport which burns $2,000,000 a day

00:44:37 - The industrial sector does not get the love from small business buying community

00:47:39 - Jules pre-acquisition vs. Jules post-acquisition (skills, experiences, beliefs)

My full conversation with Jules Brenner, the founder of Industrial Succession Group — Stream now.

Follow PrivatEquityGuy on Twitter: ⁠⁠https://twitter.com/PrivatEquityGuy⁠⁠

Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small profitable niche businesses: ⁠⁠https://privatequityguy.beehiiv.com/

Jules on LinkedIn: https://www.linkedin.com/in/jules-brenner/

This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

What would be your potential reward for mastering the fundamentals?

Whether it's small business acquisitions, private equity investing, or the financial media and newsletter business…

In Matt’s case the reward is approximately $14,000,000 in net profit in 2024

All this with a team of 16 people.

We discuss:

— How to grow a business (Growing 86% in 2020; 77% in 2021)

— Email is still massively untapped for PE funds, VCs and traditional businesses

— Spend $1-2m per month on advertising

— Why more private companies should publish their numbers

00:00:00 - Intro

00:00:19 - Team of 16; $2.3M in revenue per employee

00:05:57 - Different sources of revenue

00:07:48 - A short masterclass on how business builders and investors can use email to their advantage (deals, talent, capital)

00:18:01 - Mentors are key

00:19:19 - Hiring mistakes and lessons learned

00:22:54 - Bootstrapping vs. raising capital

00:23:25 - Why share ALL numbers publicly, even when running a private company

00:28:17 - How to overcome VERY difficult periods (personal, family, business)

00:39:11 - 3 lessons from 17-year career (distribution is everything)

00:43:12 - The key to 0.0001% success is to turn your business into your hobby

00:50:47 - $200,000,000 and I’m out

My full conversation with Matt Paulson, the founder of MarketBeat — Stream now.

Follow PrivatEquityGuy on Twitter: ⁠⁠https://Twitter.com/PrivatEquityGuy⁠⁠

Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small niche manufacturing businesses: ⁠⁠https://privatequityguy.beehiiv.com/subscribe

⁠⁠Matt on Twitter: ⁠https://twitter.com/MattPaulsonSD

This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

Imagine being so unhappy with your boss that you leave…

- Start the exact same business

- Following the exact same strategy

Today, ONLY 5 yrs later do $500m in revenue and $100m in EBITDA

Here is my full research on a true M&A and buy-and-build pioneer Mr. Fredrik Karlsson:

00:00:00 - Intro

00:00:52 - 24 portfolio companies (15 B2B; 9 B2C)

00:03:51 - The type of businesses they acquire

00:07:00 - The beauty of investing in HoldCo businesses

00:10:05 - A very successful investment in yacht supplies business

00:12:19 - How to find the right CEOs to run PortCos

00:16:02 - Being happy with 1% organic growth

Follow PrivatEquityGuy on Twitter: ⁠⁠https://Twitter.com/PrivatEquityGuy⁠⁠

Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small profitable niche businesses: ⁠ https://privatequityguy.beehiiv.com/subscribe⁠⁠

This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

Here is the dream story of many entrepreneurs:

Owning a business that generates so much free cash flow that you can invest in/acquire 8 businesses.

I’d even call him Andrew Wilkinson Jr…

Capital allocation at its best…

Started in 2017…

Today there are 8 companies in his portfolio.

All while being 32, traveling & living in 20 countries, having Tim Ferriss as an inspiration and driving a Range Rover Sports.

Most importantly, being generally happy and relaxed (my comments about him).

"The freedom of location. For the past 7 years I’ve lived and worked in 20 different companies. Only thanks to the businesses I ran.”

We discuss:

— Building a list of companies to acquire

— Finding the absolute best off-market deals

— Growing businesses 2-3 times in 18 months

— A 30-day post-acquisition action plan

— One book that changed his life forever

00:00:00 - Intro

00:00:29 - Early failures turned into successful cash-flow machine

00:03:20 - Andrew Wilkinson from Tiny as a big influencer

00:05:18 - Acquiring a business using seller financing or not doing a deal at all

00:07:54 - Capital allocation at its best - buying vs. starting

00:11:19 - 8 businesses, 8 different CEOs

00:18:35 - Growing portfolio companies 2-3x in 18 months

00:21:19 - How to build a database of companies you want to acquire

00:23:52 - How to acquire a business in 30 days

00:27:59 - This is how you build a company where people want to work

00:32:11 - Turning big mistakes and failures into success

00:36:09 - Diversification, diversification, diversification

My full conversation with Lee Betts, the founder of BettsCo — Stream now.

Follow PrivatEquityGuy on Twitter: ⁠⁠https://Twitter.com/PrivatEquityGuy⁠⁠

Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small niche manufacturing businesses: ⁠⁠https://privatequityguy.beehiiv.com/subscribe⁠⁠

Lee on Twitter: ⁠https://twitter.com/leebetts_

This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

One great acquisition can change the life of you and your children.Forever.As the smartest private market deal makers have said:"The goal is to acquire $10 bills for $3 ... and again, that's only possible in the private markets."My top 5 lessons on actively looking for exeptional $2-10 million revenue companies. (Pre-acquisition)1. Being street smart will take you further than you can imagine. Cold calling. Being likable.General soft skill, listening more than talking, asking great questions. Doing a follow up. Many don't want to do it, and most don’t know how to do it.2. VC is sexy; but old-school folks who run a cogs and gears manufacturing biz in their 50s are much happier. They make money every single day. Days become weeks. Weeks become months and years.95% of them are seriously happy with zero debt and not much stress. Time for a wife, time for kids, time for hobbies, time to travel. No Forbes but they could care less.3. An hour-long meeting that will last 2-3 hours. Take time and listen. This is their life's work. Very rarely does anyone go there and appreciate the work they’ve done. It’s their baby. It’s the company they have built. Be that person who listens.4. Without brokers, it takes years. Getting a person who does not want to sell their business to actually sell it, takes ages. You really have to enjoy the journey. If it's a great business, you play by their rules.5. Soft-skills. Forget the Excel and EBITDA. They barely use CRM. Talk in plain language: "How much money did you make last year?"That and 11 other lessons, hot takes on this week's podcast:

00:00 - Intro

00:47 - A person with average intelligence can do it

02:56 - Forget the industry

08:52 - It's a numbers game

16:12 - Emails are good. Phone calls are better. IRL meetings are the best

24:01 - Practice negotiations, make offers

Follow PrivatEquityGuy on Twitter: ⁠⁠⁠https://Twitter.com/PrivatEquityGuy⁠⁠⁠Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small niche manufacturing businesses: ⁠⁠⁠https://privatequityguy.beehiiv.com/subscribe⁠⁠⁠This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

The day has come! SME people, whatever you are doing, stop it.

Here is a masterclass:

How to grow ANY traditional and “boring” business 50-200% annually.

From $2.2M to $3.1M…

From $7.6M to $11.2M…

From $1.2M to $1.8M…

And why do so many boring niche businesses suck at marketing?

Masterclass notes:

00:00:00 - Intro

00:00:56 - Why should we listen to Priit in the first place?

00:01:25 - Customers are satisfied with my products, what next?

00:02:43 - “Yes, but I have an agency or marketing person in the office, isn’t that enough?”

00:04:46 - Posting on Instagram, running FB and Google Ads – Good but very far from enough

00:06:55 - The biggest problem is not HOW to achieve growth

00:08:52 - How to grow from $2-10 million per year mark to $20 million

00:11:06 - What is data-based marketing?

00:16:29 - I’ve been stuck at $2 million for 4 years: here’s how to grow to $5 million

00:19:27 - What does going through that kind of growth require from the owner and management

00:25:14 - How quickly can Priit turn the company around?

00:27:41 - Business owners don’t know what they don’t know

00:30:39 - “Do this and you’ll succeed!”

If you are a business that needs help with growth marketing, I highly recommend getting in touch.

Note: Alongside being a happy customer, I am also an investor in the business.

Link to Conversion-Ninja

Follow PrivatEquityGuy on Twitter: ⁠⁠⁠https://Twitter.com/PrivatEquityGuy⁠⁠⁠Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small niche manufacturing businesses: ⁠⁠⁠https://privatequityguy.beehiiv.com/subscribe⁠⁠⁠This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

Spent 7 hours researching a true master of small cap private equity:

- 586 transactions

- Acquire $1 million to $10 million EBITDA companies

- Average deal $12 million

- 72% IRR

- 7x cash on cash returns

He had two rare public appearances on Patrick O’Shaughnessy’s and Harry Stebbings' 20VC podcast.

His name is Justin Ishbia and he is the founder of Shore Capital Partners.

00:00:00 - Intro

00:01:28 - Mentors

00:02:05 - Lessons from dad

00:04:05 - Early days of Shore Capital Partners

00:09:45 - Margin of safety

00:11:50 - Making mistakes

00:14:40 - 80% are the first time CEOs

00:17:19 - How Justin finds six to seven talented Board of Directors for each of his portfolio business

00:21:45 - How to build systems that works 8 times out of 10

00:23:25 - Which people succeed in Shore Capital Partners

Here's what I learned:

1. “Constellation Software, Mark Leonard is a friend and a mentor. I'm not smart. I know who to copy. And did I copy -- they did all in software. We've done it in operating businesses,”

   
   

2. Biggest lesson from dad: “Don’t do things you don’t understand. You do what you understand and you can execute on it well.”

   
   

3. Industry, industry, industry! “If you go into the publishing industry right now, he doesn't care if you are Jack Welsh’s at his prime, you'll probably not end up having a bunch of success.”

   
   

4. 80% of our CEOs are first time CEOs. Big believer in early career energy. It takes a really smart person about 18 months to learn 90% of the industry.

   
   

5. Margin of safety. Most private equities commit $100 to a thesis, investing between $60 and $80 of that investment for the platform and reserving $20 to $40 for add-ons. Justin and Shore Capital have almost the exact inverse. They’re committing $100 to the thesis, and deploy $5 to $25 for the platform. It gives that great opportunity, he thinks, to increase your margin of safety, increase an opportunity for success.

The biggest take away was how Justin hires 6-7 board of directors for portfolio companies with almost zero $$$.

As the board of directors themselves say when they very first time show up:

“There's more people on the board than there's millions of revenue.”

Follow PrivatEquityGuy on Twitter: ⁠⁠https://Twitter.com/PrivatEquityGuy⁠⁠Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small niche manufacturing businesses: ⁠⁠https://privatequityguy.beehiiv.com/subscribe⁠⁠This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.

Very first acquisition in November 2016

As of March 2024, they manage a portfolio of 12 companies.

All done with their own capital.

(Except the one they did in late 2023)

95% of acquisitions have been owner succession & retirement driven buy-outs.

Cub Investments with Nick Haschka makes long term buy & hold equity investments in growth-oriented field services companies.

Most importantly, all this while raising three beautiful children.

Their biggest competitive advantage – looking for companies with an extremely small universe of buyers.

“What we do is very different from corporate America, strategic consulting, investment banking, PE, McKinsey….”

We discuss:

— Finding the absolute best deals

— Location as your biggest advantage

— How to get the buyer to sell the business

— Doing everything with their own $$$

— Using SaaS as a difference maker in those boring businesses— Post-acquisition before and after

— Finding a perfect co-founder

00:00:00 - Intro

00:00:19 - Current portfolio and Nick’s dream acquisition...

00:02:10 - Background story and why small business PE is not for most people

00:05:50 - How Nick finds the best deals

00:10:55 - Location and industry knowledge as your biggest advantages

00:13:30 - Red flags when acquiring a company

00:16:25 - 2023 and raising capital in a short 4 weeks

00:24:40 - What made the biggest difference in their MOST successful deal

00:32:07 - Craziest post-acquisition stories

00:39:30 - Founders relying on their memory,not CRM

00:44:19 - Partnership with the co-founder

00:51:01 - The work never stops - how to manage it all

My full conversation with Nick Haschka, the co-founder of Cub Investments.

Follow PrivatEquityGuy on Twitter: ⁠⁠https://Twitter.com/PrivatEquityGuy⁠⁠

Join HoldCo Builders weekly newsletter on finding deals, raising capital, and growing small niche manufacturing businesses: ⁠⁠https://privatequityguy.beehiiv.com/subscribe

⁠⁠Nick on Twitter: ⁠https://twitter.com/NickHaschka

This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.