Much has been written of selecting an investment manager. What about managers selecting investors? Some of my favorite authorship on this subject is from Warren Buffett in his 1960’s partnership letters. In these annual letters he repeats the concern about compounded costs incurred by employers of large institutions who overlay their own reputational risk upon Read more about Selection of Business Partners[…]
Today, I was referred to a potential small business buyer and manager. He has some cash but is looking for an equity partner… maybe. While I’m grateful for the referral, I also sniffed out a few problems. Being the nice guy that I am, I wanted to save the individual from some serious bruises from Read more about An Email to Executive Referral[…]
Have you ever heard someone say, “create your own luck”? I believe there is skill in selecting situations where the magnitude of a good outcome far outweighs the magnitude of the distasteful outcome. This is my interpretation of creating your own luck. Probabilistically: Look for coin flips where heads you win $100, tails you lose Read more about The Skill of Luck[…]
For a number of years I wondered why Warren Buffett used the phrase “Investment Ideas” in his early partner letters. While I still don’t know exactly, I think the Oracle was saying, “buy & build” or “acquire & innovate.” Buffett is known as a value investor from Graham-Doddsville. “Investing” is about buying with a margin Read more about Investment Ideas[…]
Today a friend came into our office to seek some free advice. His question: how do I start a business with no cash? After a long winded series of questions and answers, I should have just said, “you can’t.” Mikel said that pretty quickly. Perhaps I’m a slow study. Maybe I like a good challenge? Read more about The No-Risk Entrepreneur[…]
Last year I had a bit of an obsession with power law distributions (people naturally apply a normal distribution or classic bell curve to situations.) Recently I have come to appreciate the phase change to a greater degree. The most common phase change we are all familiar with is the conversion of water to ice, Read more about Tipping Points & Phase Changes[…]
Following a portfolio company board meeting yesterday I decided to linger and observe a sales staff huddle. Present were the CEO and two salesmen. (They each wear other hats but the focus of this agenda was on sales.) The CEO kicked off the meeting and began with a review of territories and key accounts. One Read more about A Small Business Sales Meeting[…]
Earlier today I was reflecting on the distinction between expectations and exposure. Most of us naturally assume normal distributions. We look at a few data points, plot the minimum, maximum and compute a rough average in our head. We then draw a virtual bell curve in our mind. This works for things like human life Read more about Expectations versus Exposure[…]
Some blog posts are silly. Have you seen our post about buying a stapler? Some blog posts are very serious. We post details about our Annual Meetings. This post is somewhere between silly and very serious. I’ll let you decide which way you want to read it. Today, I was updating my OKR’s and made Read more about Daryl’s “Rule of 30”[…]
We just purchased our first stapler. That’s right. We bought businesses before we bought a stapler. Today is a monumental day. As I loaded it with staples and put it on the shelf I happened to think, “this is weird… and somewhat revealing.” At our Annual Meeting I had a slide that compared Conventional with Read more about Buying Our First Stapler[…]