20x growth, 15 portcos, and kids who don’t want to run the family business or become titans of industry.

Dear Friends, Company Builders and Fellow Capital Allocators,

I had a wonderful meeting with a gentleman who is in the business of selling personal protective equipment to metal manufacturing companies.

He’s been in the business for 20+ years while paying himself $400-$500k in dividends per year.

THE absolute best part… all while living the elusive 90-minute workday.

i.e., he gets up, reads and answers emails, has an early morning meeting, and is done for the day… with a house paid in full, no debt, kids at universities, daily walks with his dog, lots of time photographing birds in nature, Tuesday evening saunas with the boys, hanging out with his wife, traveling 6 months per year… no real worries and no desire to do more than just live life

Yes, his closest competitor makes 3x, but he said he couldn’t care less, as they’re at the office many more hours where he barely even goes there.

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During our meeting I asked what was next for him, he said his son might be interested in taking over the business...

"Knowing my son, I’m afraid he doesn’t have what it takes," and started laughing.

He went on a little rant, saying he has many friends his age (also business owners) who plan to retire in the next 3-5 years, but whose kids don’t have what it takes to run the business.

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Not a week goes by when we don’t discuss the importance of every single company having even a tiny list with Brandon. He does this for a living, and they helped their client go from 0 to 140,000 subscribers within 14 months, which added an additional $500,000 in revenue.

He sent me an email last week:

His company, Spacebar Studios is a sponsor of this newsletter… Whatever the case for you, you can book a free call with Brandon to discuss how to create and build a newsletter for your own firm.

Again, they are going to work with 3 standout companies to add 25,000 subscribers to their newsletter within 90 days, or you don’t pay.

(There is nothing to lose. Literally.)

Book a call here.

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The following is our very typical office conversations while discussing the succession of traditional niche businesses:

Everyone has different views, like it or not, the world is now, and will forever be, a tough, cruel place, made more so by those without financial security.

Financial security leads to a sense of safety, can afford freedom, is one enabler to remove stress, and can improve the quality of healthcare and long-term care needs, as well as provide comfortable and safe living surroundings, not to mention the ability to learn and grow through experiences and travel.

Take those traditional companies that have been generating millions in free cash flow for decades. Fine… maybe the kids don’t want to run the family business or become titans of industry. But that doesn’t mean they can’t volunteer or focus on impactful philanthropic pursuits and improving their community and that of their fellow citizens.

The older generation is worried about the worst-case scenario: the next generation running out of money, becoming addicted to harmful substances (you know what I mean).

So it comes back to rules and the family philosophy: “You have to do something; you can’t do nothing.”

Many of them are in situations where a wealth planner can really help by acting as a strategist, implementer, and educator to the family. It comes down to good parenting, good role models, and sound, objective advice from an advisor to help educate all members of the family to become good stewards of the capital (even if, over the past five years, it has come into their hands relatively easily).

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It’s remarkable what hiring the right executive coach can do for your business, your career, and your life.

Listening to a gentleman who hired one in the M&A space, who helped him understand the process, the integration of rolling up the exact type of companies which led to many acquisitions.

Without this hire, he would never have gotten to that point... because how many people or companies do you know who have ever completed an acquisition?

It’s VERY rare. At the same time, it’s a skill like any other that one can learn... and even master when learning from someone who’s done a few dozen themselves.

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If you are ever considering starting an investment firm, I highly suggest you read Graham Duncan's letter to a friend.

(Sage advice from someone who started his fund at 31 and today manages a $2b fund himself.)

Here are few ideas from his masterpiece:

1.  Life is too short to be paralyzed by the threat of a mixed reference – some of the most revered investors in the world today were at best damned with faint praise when they left their old firms.

2.  Your job is to accelerate the process of building trust with people who don’t know you.

3.  Having wealthy friends and colleagues? Speak to them, and get them to wire cash into your investment partnership.

4.  Wearing a suit to a meeting is one signal we send to people that we’re telling the same story about business and money.

5.  Good hiring is critical: the people around you will either protect or infringe on the climate within your skull.

6.  It’s very hard to own somatically (as opposed to cognitively) in advance of what it feels like to lose money for other people.

7.  GPs are often mismanaging their own anxieties. So your job is to protect your psychology in advance, so prepare yourself for innocent clumsiness by your LPs.

8.  It’s the manager’s decision to make the right calls for the portfolio … not the investors

9.  Before starting something new – spend time alone for several weeks with a blank sheet of paper

10.  Give yourself enough time to build a positive vision of a future fund instead of simply reacting against someone else’s vision or your own prior frustrations.

11.  Money is like gasoline while driving across the country on a road trip. You never want to run out, but the point of life is not to go on a tour of gas stations.

Here's a link to the original letter.

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My conversation with Sid Jashnani, who turned a $3.5m systems integration business into a 15-company portfolio generating over $77m in revenue.

A very special story for many entrepreneurs who’ve plateaued at one level. Sid shares exactly how he went from daily firefighting to running a group of companies.

He describes his model as “structure over hustle” - combining the discipline of EOS with vertical integration to own every layer of his industry, from manufacturing to delivery.

Despite already running a portfolio of 15 companies, we also discuss how he’s now preparing to explore acquisitions.

(Time and schedule wise, he now manages a platform with $77mm in sales and plays much more golf with his two kids than he did when the company was doing $3.5mm in sales.)

Another fascinating story in the traditional-business space.

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

That’s all for today.

Thanks a lot for reading and I’ll talk to you again next week.

Take care,

PrivateEquityGuy / Mikk Markus

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