250 Buyers & Builders in one room

Buyers & Builders,

A (small) major announcement.

As going from online to offline to build great relationships is one core foundation of buying and investing in traditional niche businesses,

I got something for you:

Yes, one can always sit in the office and wait for the phone to ring.

Or…

One can do the exact opposite:

-Always be on the go
-Cold-call founders and brokers
-Meet owner/operators
-Build relationships with investors while driving around towns, countries, and continents

And... attending industry events and conferences.

With all that being said, there’s an event coming up in less than two months.

250 buyers and builders in one room. 50% of tickets are sold out.

(Important to mention: I will also attend, but I am not affiliated with this event. It’s hosted by Alex and his wife, Helen. I’ve known Alex for years. Genuinely great guy. They work super hard on this one, and not only that, Alex has spent years traveling around the world and attending events so he could learn, implement what he learned, and hopefully build the best one possible.)

- - - -

The team at Colossus published an excellent essay on invisible companies (link to the article). If you haven't read it yet, it's well worth your time — or listen to it by copying the article link on the Speechify app.

To make big money in business, you usually have to do something no one else can do, or have something no one else can have.

Steve Ross did neither. Nor did Wayne Huizenga, or the great bearded Mark Leonard.

Ross started out renting his father-in-law's funeral parlor limousines at night. He added a rental car company, a parking lot business, a cleaning company, a plumber, then he took the whole thing public, funeral parlor included.

In 1969 he bought Warner Bros. for $400 million. In 1990 he took home $78 million, the biggest pay package in America.

Huizenga became a billionaire buying garbage trucks. Leonard bought tiny software companies nobody wanted and built Constellation Software, which has compounded at 34% a year for 20 years.

What they did wasn't special. Any of us could start the way they did, tomorrow.

We won't. Who wants to tell people they're in garbage? And that's why the money is there. Nobody looks, so nobody competes. Nobody competes, so the profits persist.

These are invisible companies. Here's how to find them, if you're willing to get your hands dirty.

It got me thinking of all the conversations and interactions I’ve had over the years with people buying, building, and operating these invisible companies. These are exactly the people these guys describe in their article.

And here is my word-by-word take on this, with the main idea being that the person running these types of companies is THE moat.

As long as we have Christa, Reggie, Nick and Mark type individuals…

The mature, operationally mundane, “invisible” businesses will quietly keep minting those attractive profits.

And these firms earning zero economic profit will never happen.

I only say this because of the 200 episodes I’ve done with those exact folks behind those roll-ups, HoldCos, and long-duration compounders, I can confirm with conviction that they are built differently.

Just like Steve Ross was able to start and acquire a funeral parlor, a cleaning company, a flooring company, a carpentry company and a plumbing company - the businesses with no moat whatsoever. He bought and built those because he was THE moat. Same with the 200 podcast guests I've had. It’s them and their knowledge, experience, attitude, mental toughness and grit - this is the moat.

And these “moats” protect a company from profit-destroying competition.

Companies are mostly invisible primarily because no one is paying attention to them.

This is true, and I’d go a step further… All companies are built by people (Let’s not get into AI agents at the moment). Often started by one, two, sometimes more individuals who see something invisible first.

These companies are invisible only because no one is talking about them and for the same reason the majority of people don’t even know they exist…

I’d like to bring attention to the men and women who are building such companies. The people behind those roll-ups, holding companies and long-duration compounders, the buyers and builders.

Joining the podcast, they were open and transparent, sharing personal stories alongside many trade secrets with thousands of listeners. All without expecting anything more than more work (read: more deals, people, capital… but also more competition) in return. My take on why they’re willing to come and share their stories and knowledge - they’re not afraid of competition. Literally.

You want to see what I mean?

Take Christa Glassburn - built a search fund, acquired seven companies and scaled revenue from $15 million to $200 million. The companies that have no website, no salespeople, are often the ones overlooked by private equity. She shared details while calm and relaxed, knowing no one is willing to move to rural Virginia to do what she did. Christa is the moat.

Or take Mark Rossano, who’s building a holding company that owns hydroelectric power plants and sustainable fertilizer companies.

Building this wasn’t easy...

Early in the journey, his daughter required emergency heart surgery… "I ended up shutting down the fund because my two partners walked out on me. She survived the weekend... I ended up living with her in the hospital for about two and a half months. I needed a job, so I took a job as a commodity strategist at Bloomberg."

How many folks have overcome something like this? Tough story, even tougher individual. Mark is the moat.

Or take turnaround specialist Reggie Pryor Jr., founder of Pryor LLC, acquiring Moretex, a company founded in 1908 that manufactures the highest-quality Polyethylene Emulsions and Oxidized Polyethylene powders, how he stumbled onto the opportunity by walking into the building and asking if they were selling the company.

Not too many people are doing this, as provocative and confident, but this exact thing led to a favorable transaction acquiring both the real estate and operating company. Opening the door and walking into that business in Spartanburg, South Carolina is a moat activity.

Take Nick Hatchka, who first completed over 12 acquisitions across interior plants and landscaping, and then was willing to quickly pivot into rolling up regional generator dealers and service businesses. A different level of commitment, shift of focus, and work ethic is required for that.

Building one roll-up is unimaginably hard. Nick is building two. What does this say about Nick and his commitment? How often do you come across individuals like Nick?

The article said companies are invisible primarily because they are disdained, because the work is low-status, unpleasant, parochial, or socially stigmatized.

The price you must pay to build successful companies is incredibly high, and those sharing the stories know that – through lived experience. It’s all easier said than done (insert, buy my course on how to buy a business here). Hence, sharing all the details doesn't even bother them. Bring it on.

Going after invisible companies? I’ll paraphrase Kyle Tucker of Tucker’s Farm, (with my slight edit): “If you find a killer resume continuing the mimetic thing (‘The smartest people I know are doing these invisible companies, so I want to go do that’), expect a higher degree of failure risk.”

1. Thanks for reading this week’s newsletter.
2.  If you haven’t already, go look at the Serial Acquirers event.

That’s all for today.

Take care,
PrivateEquityGuy / Mikk Markus