The Operator Weekly: What Does TLAO Mean to You?

What Does Think(ing) Like An Owner Mean to You?

When you own a car or a home, you treat it vastly different than a rental.  You maintain it (hopefully!).  College housing would likely be cleaner if the students owned it for the long term.  Student Rental Pro on Twitter has enough stories to scare you away from owning and renting to students.

A significant part of growing your business is enabling others to think like an owner as well.  Fair Play by Eve Rodksey, while it is about domestic household responsibilities, applies to business as it explains how having a to do list in your head is a mental drain.  Delegating duties is how you free yourself from owning the minor details, the things you do not want to focus on.  That mental load is taken off your plate.  Delegating ownership to someone else does not mean you may not work on it or stay up to date, it just gives the overall responsibility to the other person.

Thinking like an owner tends to be in the more macro view, that 30,000 foot view analogy, where you are viewing things across the business and how they interact.  You can and often will get into the weeds of the business, but you are informed by other areas.  On the most recent episode with Mark Brooks, Mark talks about the idea of delegating. With growth CEO should be handing off things he was doing a few months ago.

Dave Waters, who came on to TLAO (listen here) to discuss how he invests into public small cap companies, shared how the metrics in the long term matter more than the short term mindset focus on each quarter.  To invest for the long term, like an owner of a business, you wouldn’t sell your business just because of a bad quarter.

When Alex came up with the name for Think Like an Owner, it originally was a tie to the hedge fund world. Buffett says to be a great investor you should think like the owner of the entire company. Would you buy this entire company? If yes, buy some stock. If no, move on. When you think of yourself as an owner, you pay attention to different things in the business than if you’re a short term trader. Alex wanted to meet people who thought like owners because they were owners of small companies.

So, what does thinking like an owner mean to you?  How has the perspective of ownership changed your life or business?

Thanks to Everest Brady for his help, writing, and research in assembling this week's newsletter.

Read

Contrary Research just launched and released 20+ private industry reports covering companies like Anduril Industries, Ramp, SpaceX, and more!

Listen

Chris Powers had Tim Ludwig on the Fort podcast to cover entrepreneurship through acquisition.  Tim is a founding Partner at Majority Search and has backed over 80 searchers.  This episode is a true masterclass on the search fund industry, how it matured over time, and how Majority Search structures deals.  

Tim is a great friend of Alex and valuable member of the SMB community.  He has come onto TLAO several times, including for a live episode recorded at SMBash in February 2022.

SMB Job Postings

Byron Assistants, owned and operated by Ujwal Velagapudi, is hiring for a Chief Operator role.  Byron pairs US based, college educated virtual assistants with customers and is already at high 6 digits ARR.  The role will have full autonomy and significant upside as you learn the business inside and out.  You can see the job description here and apply here.

Ujwal also came on TLAO covering how he acquired 9 companies (including a large vending business), real estate, close calls, use of debt, and more.

This Week on Think Like an Owner

Alex’s guest on this episode is Mark Brooks, Managing Director of Permanent Equity. Mark leads Permanent Equity’s post-close operations team, partnering with company leaders to overcome challenges and unlock growth.

Mark is a really reflective person, which you can tell from his writing on Twitter. He's thought very deeply about management and creating transformative teams, and this conversation is dense with value and insights. This episode is a fantastic dive into all things management, including brevity and effective communication, creating an environment that encourages debate and disagreement, and why great teams are crucial to combat process depreciation.

If you know of anyone Alex should talk to or topics to cover, please reach out to him via replying to this email.

This Week in SMB Twitter

Think Like an Owner is sponsored by:

Live Oak Bank – Live Oak Bank is a seasoned SMB lender providing SBA and conventional financing for search funds, independent sponsors, private equity firms, and individuals looking to acquire lower middle market companies. If you are in the process of acquiring a company or thinking about starting a search, contact Lisa Forrest or Heather Endresen directly to start a conversation or go to www.liveoakbank.com/think.

Hood & Strong, LLP – Hood & Strong is a CPA firm with a long history of working with search funds and private equity firms on diligence, assurance, tax services, and more. To learn more about how Hood & Strong can help your search, acquisition, and beyond, please email one of their partners Jerry Zhou at [email protected]. 

Oberle Risk Strategies– Oberle is the leading specialty insurance brokerage catering to search funds and the broader ETA community, providing complimentary due diligence assessments of the target company’s commercial insurance and Employee benefits programs. If you are under LOI, please reach out to learn more about how Oberle can help with insurance due diligence at oberle-risk.com. Or reach out to the CEO, August Felker, directly at [email protected].

Interested in sponsoring? Reply to this email and let’s chat.