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Shaan Puri

13 Jan, 11 tweets, 3 min read

@RomeenSheth

Hmm... something interesting I learned from my buddy @RomeenSheth about McKinsey.

I thought they are just a stale boring consulting co

But he told me they've acquired a ton of software co's & now have a $100M ARR tech portfolio now (!)

I'll let him explain - guest thread!

If you don’t know, McKinsey is a gigantic consulting company:

- $10B+ in revenue
- 80%+ of the F500 as clients
- Hard to get a job there. (<1% of applicants get hired)

Their bread and butter (70% of revenue) used to be “pure strategy” work. That’s now down to just 10% - why?

Clients are demanding “value based” billing. Meaning less "guys in suits talking" and more "show me something tangible"

For example -lets say a client hires McKinsey because they think they are spending too much money on procurement.

So McKinsey acquired Orpheus - a software co that does analytics for procurement.

Instead of advice, they give them a tool (a real solution)

Now Orpheus has been around for 15 years. McKinsey can buy it at a fair price, knowing that it can inject steroids into the business.

Why?

McKinsey has what most software companies don’t:

DISTRIBUTION: 80% of the Fortune 500 already works with them, and their brand is known by every CEO in america.

PRICING POWER: they can bundle the software in with a much larger consulting contract.

Over the last 5 years, McK acquired 10+ companies and created McKinsey Solutions - the business unit that’s going to drive $100M+ ARR.

McKinsey has a really specific acquisition type, either VERTICAL or HORIZONTAL.

Vertical: Solves for a problem widely observed in an industry (eg. Pharmaceutical Co.)

Horizontal: Solves for a problem for a division that all companies have (eg. HR)

The unfair advantage they have is that McKinsey PRINTS money.

Billions in revenue, and consulting margins are 70%+

They can take that cash and re-invest it into tech, that makes them even more valuable.

@RomeenSheth

The software play is a gamechanger for McKinsey.

It wouldn’t surprise me if McKinsey builds a $25B+ software portfolio over the next 10 years. There’s a very quiet (but massive) business model transformation playing out

Shoutout to @RomeenSheth for the insights. Follow him!

@MBentivoglio

Some interesting names they’ve acquired:
Orpheus
Numetrics
Veryday
Lixto
QuantumBlack
4Tree
Lunar
VLT Labs

via @MBentivoglio

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More from @ShaanVP

Shaan Puri

@ShaanVP

14 Jan

10 years ago, Netflix spent $0 on original content.

This year:

Netflix: $11B
Apple: $6B
Disney: $1B
+ amazon, hulu HBO etc.
=
$20B+

Here's a crazy startup idea to take a swing at this $20B+ content piñata. 👇 Here's a quick business plan 🤔

@ycombinator

The idea ---> @ycombinator for Content

Let's give it a made up name : Zeta Studios

It is a new accelerator model for getting shows & movies made.

@ycombinator

@ycombinator = give engineer duos money ($120k), coaching, & give them 3 months to get ready for a Demo Day in front of a room of investors.

Zeta = give storytelling duos money ($120k), coaching, & 3 mo to get a sizzle reel ready for Demo Day w/ buyers from netflix, amazon etc.

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Shaan Puri

@ShaanVP

9 Jan

just sent out a newsletter to 16k subscribers about...CLOUT KITCHENS:

WHAT it is...HOW it works...and HOW MUCH $$$ they make👇

A lot of people have heard of Cloud Kitchens (a restaurant with no storefront. They ONLY do delivery via doordash, uber eats etc.)

That's a cloud kitchen. What's a 'clout kitchen'?

@MrBeastYT

It's a cloud kitchen - branded with an influencer who has clout.. hence, a clout kitchen.

The best example? 3 weeks ago when @MrBeastYT came out with MrBeast Burger and it became the #1 app on the app store, and got slammed with so many deliveries it was 2-3 hour delays

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Shaan Puri

@ShaanVP

7 Jan

🧠 3 years ago - I created a new framework for New Years Resolutions.

Year after year I would set New Years Resolutions (the same ones every year) and fail to reach them.

Am I doing this wrong? Am I just weak minded?

Then I found this, and switched up my new years routine

I wasn't alone in failing at my new years resolutions.

Not only do 90% of people give up on their new years resolutions… on average they fail by January 18th (known as “Quitters Day”)

It makes sense. If you were waiting for an arbitrary day to decide to change - you probably weren't that commited to begin with.

So instead of making plans for the future, use new years as a moment to reflect

They don't teach us this in school, so here's a framework for it👇

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Shaan Puri

@ShaanVP

30 Dec 20

If you wanna level up - the fastest hack is to hangout with people who are ALREADY at that level.

The beauty of twitter is that you can hang with anyone.

The problem is ppl follow the wrong accounts. It's noisy as f*ck.

Here's 27 people you should follow (and why)👇

If you hang with smart, interesting, successful people - you will start to think & talk that way too.

We are monkeys that copy what we see. You can fight it, or use that to your advantage by surrounding yourself with people who you want to become more like.

@chamath

Group 1: Smart, Rich, & Don't Give a F*ck (no filter)

@chamath - was early FB, has big balls, bet early on Bitcoin & SPACs

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Shaan Puri

@ShaanVP

28 Dec 20

@paulg

I think @paulg accidentally predicted Bitcoin exactly 1 year before it launched..

Paul was giving a talk at startup school about the two most common bits of advice YC gives its startups:

1) Make something people want
2) Don't worry too much about making money

If you put those two together...

= non-profit

It was a joke wrapped around a nugget of truth.

Some of the greatest startups look like non profits initially.

Eg. Google did not look like it was going to become a trillion dollar company. It was a free search engine built by 2 PHd students with no business model.

Read 17 tweets

Shaan Puri

@ShaanVP

23 Dec 20

I doubled down on angel investing over the past 6 months.

Invested $600k in the past 6 months into 8 startups... for anyone interested in startup investing - a few standout companies and spaces

@mydukaanapp

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@mydukaanapp is building shopify for india (3M+ stores created in 5 months)

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Remote Work -

I think there is both a huge opportunity AND a ton of garbage in this space right now.

Because 30M engineers all simultaneously experienced the pain points of remote work, and started building tools to solve it.

Lots of crap, but a few gems..

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