@WilsonCompanies released some of his operating playbook yesterday in this fantastic thread. Just so happens we're recording a podcast today, let me know if you want me to ask him anything specific!
I could put any one of a dozen threads by @StrongpointRich, but this was a great one that stood out to me recently about productive vs non-productive costs.
Thank you all for sharing your advice, stories, and thoughts so freely and openly on here. It's incredibly helpful!
Please let me know if I missed any! There was a huge flurry of great Tweets over the last 2 weeks from SMB Twitter and I don't want to skip over any of them.
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Have any searchers been funded via something like @earnestcapital's Shared Earnings Agreement (SEAL), rather than a traditional search investment?
The SEAL pays a % of owner earnings up to a cap multiple (2-5x investment) and converts to equity in a cap raise.
Could it be used?
The two (SEAL & Trad search) feel pretty similar, but the SEAL would continue paying the investor even if the search failed.
The failed searcher would pay a % of income up to a cap multiple, reducing the "go-to-0" risk to the investor of giving them capital in the first place.
If the search succeeded, the SEAL's % of owner earnings would repay quickly.
Perhaps there are two cap multiples, one for a failed search (say 1.25x) and one for a successful search (3x) to keep incentives aligned without burying a failed searcher in unmanageable debt.
In my searcher survey I asked searchers for their one piece of advice to prospective searchers. This thread is 29 pieces of advice current searchers and operators shared and I hope you find immense value in their perspectives.
Enjoy below 👇🏻
1. I don't have advice, just my opinion: I try to take alignment over convenience.
2. It’s hard but rewarding. Make sure your family understands the project.
1/ Not sure how many of you have heard of Edelweiss Holdings (permanent capital co) and Anthony Deden, I had but had not seen this interview with @realvision until @amellis_84 sent it to me.
He said it would "blow my mind" and he was right! Takeaways:
2/ @amellis_84 has a Deden quote on his site which I liked so much I added it to mine. Describes "Think Like an Owner" perfectly:
"I think that one of the things that is missing, and one of the things I have discovered is that there's a substantial distinction between people...
3/ ...who are investors and people who are owners in businesses. An owner in a business is far more interested in his survival, in the first instance, than its necessary monetary value. No owner of a business wakes up every morning asking himself what he's worth."