$12.5k turned into $600M and is $1.5M per year enough for a good life?

What a great week:

Met a man who lives a good life:

• Have been running a traditional business for over 20 yrs

• Owns the majority

• Net profit about $1.5mm per year

• 3 kids, married for 25 years

His attitude to life and business:

"I'm still fairly young and have a long runway to continue operating this business."

Haven't seen this positive 49-year-old in a while.

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When talking to a GP of a 9-fig aum private equity fund…

• What is the most exciting part of your job?

• Something you are extremely excited about?

• Something you enjoy most?

"The smell of a deal... If you found something, or came across something. And you're trying to win that deal on great terms. That's the part I really enjoy about it."

A short answer from a gentleman who did 7 acquisitions in 14 months.

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If you want to attract these people into your life, you should first:

1. Live an interesting life yourself

2. Share what you build (your journey, your product, your service);

If you don’t know what to do with it. The sponsor of today’s newsletter (Spacebar Studios); builds such newsletters for companies doing $1-50m in revenue.

It gets SO much better because they offer a free strategy call to those interested.

They've even said that for those first six companies who call and like what they hear and see, they're willing to create a completely new newsletter for free.

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The other day I posted on twitter:

I've told you this a few times, and now I've finally found people who are willing to help me build the “private equity guy” as I've always dreamed of.

This account gets 1-3 million impressions per month – there’s a lot we can do about it.

It's going to take time, but you'll soon see more people on our team - one of the first people we're hiring is a Chief of Staff - just to make sure we never forget anything important.

At the same time, we're becoming very specific about the market and investment opportunities.

Thank you so much for following the journey!

I started 2.5-3 years ago without knowing what EBITDA meant.

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The longer I’ve played the game, sharing my journey, the better I’ve come to understand the Private Equity Guy “client.”

A great lesson for yourself as well (no matter how big or small you start!)

If you know your customer, you can start to figure out what value you can provide them.

The company started with $12,500 (borrowed from his wife's parents)

Long story short, today Kaufman and Broad is worth sub $600 million.

(A great reminder in case you're building something today)

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Decisions in life:

2 men, both at Stanford University

Wednesdays off, one goes and plays golf the other visits manufacturing buildings in the agricultural space.

Same story every Wednesday for a long time.

10+ years later...

No information on the man who played golf…

But the "curious" young man who visited the factories runs a $300M aum holding company with over 20 acquisitions.

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You can’t fake curiosity and passion.

Whether it’s building a portfolio of traditional businesses that generate cash flow.

Or raising venture capital or running a B2B software company.

You’re competing with people who live and breathe this profession, and if you don’t… It's very difficult.

And even if you’re lucky and you make it, you’re still not where you wanted to be.

So the goal is to have a deep personal interest.

If you love doing it, it never feels like work; it feels like fun. All the time.

It should be YOUR personal passion, not your parents’ or your friends’.

It should be something you enjoy doing, even if you're alone.

And if you’re only striving for status and reward, but you’re not enjoying it…

You’ll eventually burn out.

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At the same time. Even with passion, ambition, and curiosity... it may not be enough on its own.

You need great people around you…

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Book a free call here and their team will introduce you to up to three entrepreneurs and operators who are building and running a business similar to yours.

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Peter Thiel has a great line about how the best trade of the 2010s was just buying FAANG.

FAANG being the five most popular and best-performing American technology companies.

And if you wanted to be the best-performing hedge fund manager in the world, you just had to hold FAANG, and that's it, something like an 8x return over that period.

But no one did that because it's boring and you don't get paid for that.

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I will constantly remind you this list as this is something I personally read every week.

IMHO these are some of the signs of a good life:

- 3-5 kids with 1 woman

- Portfolio of sub $1-$5mm EBITDA traditional businesses

- Headquarters with 5-6 people

- Monthly dinners with folks 10x smarter than me

- Little or no alcohol

- Little or no sugar

- 7 hrs of good sleep

- Always looking 5-10 years younger than I really am

- 2-3x mastermind weekend (hike-sauna-long walks) with folks 10 yrs ahead of me

- 3-4 ski and pool trips per year with kids

- Always around my family

- 1x/month weekend-trip with wife

- Weekly market insights/update newsletter to over 5,000 investors/biz builders/buyers

- Plenty of of steps per day (ideally 10k+)

- Lift heavy weights 2-4x per week

- Weekly date-nights with wife

- Read/study 1 book every second week

- Weekly podcast with top 1% entrepreneur

- 200+ investors who know-like-trust me

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How has been the week in the small holding company world?

The more I read and learn business and investing; the more I see the real game is staying in the game.

Lots of people obsess over exits.

Not too many talk about durability.

It seems that in order to create real wealth?

You just gotta stay in the game.

1. Acquire well

2. Operate conservatively

3. Keep optionality

4. Avoid zero

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The heavy equipment rental deal is still in works. We'll get into the details. I found an investor for this deal.

I'll keep you posted.

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Imagine acquiring a $3M-per-year cash-flow business for 2-3x earnings...

How many such deals would you need in life?

1, 3, 9?

Larry Gagosian does this in the world of fine art.

He runs 18 galleries and does $1B+ in off-market art sales per year.

Yes, he may be selling art, but there is a VERY clear and actionable toolkit that can be copied by all people building, acquiring, and running companies.

(I have to warn you: this toolkit is VERY dangerous in the hands of your competitors.)

For example, he teaches how he builds proprietary deal flow by focusing on the secondary market (again all explained in the research).

Few lessons and takeaways (save for later if busy now):

1.  Make the market; don’t wait for an invitation.

2.  Pick up the phone 100 times a day and map the territory until you are the territory.

3.  Build a private index of your niche, know who owns what, who’s aging out, who’s hungry, then move.

4.  Operate in validated markets, less romance, more cash flow.

5.  Price with information, not hope; asymmetry is your profit.

6.  Control compounds; dilution is a tax on your future self.

7.  Reinvest relentlessly into brand, distribution, and access.

8.  Own your distribution so you can name your price.

9.  Manufacture scarcity and status so demand chases you.

10.  Treat relationships as infrastructure, not decoration.

11.  Track heirs and successors because tomorrow’s deal starts years before it closes.

12.  Host rooms that concentrate your market: parties are just sales events with better lighting.

13.  Think in decades; compounding needs time and uninterrupted control.

14.  Keep a 50-asset hit list and call five owners every day, especially the ones who “aren’t selling”.

15.  Keep majority control: golden shares, buybacks, terms that protect the mission.

16.  Measure speed like a KPI: days from first contact to LOI is a P&L line item.

17.  Avoid analysis paralysis; decisions beat perfect plans.

18.  Chase leverage, not prestige; the secondary market is where adults get rich.

19.  Never trade long-term control for short-term capital.

20.  Refuse to be transactional; follow up when there’s nothing to gain yet.

21.  Be the index in an opaque market so everyone has to call you first.

22.  Start lean, grow on revenue, keep the cap table clean.

23.  Roll up fragmented, boring niches and become the default buyer.

24.  Build a flywheel of trust, scarcity, and distribution control.

25.  Play a 40-year game, quiet, relentless, impossible to dislodge.

Enjoy.

Here are the links to Spotify, Apple Podcasts and YouTube.

That’s all for today.

Thanks a lot for reading and I’ll share a few updates again next week.

Take care,

PrivateEquityGuy / Mikk Markus